Harvard Law School

Jean Monnet Chair

Seminar and Workshop on Advanced Issues in Law and Policy
of the European Union, NAFTA and the WTO

Professor J.H.H. Weiler

Harvard Jean Monnet Working Paper 7/99

Gráinne de Búrca

Reappraising Subsidiarity's Significance 
after Amsterdam

Harvard Law School    Cambridge, MA 02138

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Without permission of the author.

ISSN 1087-2221
© Gráinne de Búrca
Printed in the United States of America in 2000
Harvard Law School
Cambridge, MA 02138
USA

Reappraising Subsidiarity’s Significance after Amsterdam

Gráinne de Búrca, European University Institute, Florence*
Email: deburca@datacomm.iue.it 

Table of Contents:

I. Introduction

1.	Setting the context
2.	‘Appropriate’ levels of  decision-making
3.	Exclusive compartments or overlapping spheres?
4.	Internal and external dimensions

II. The adoption of subsidiarity into EC and EU law

1.	Seeking definition:  legal and political dimensions
2.	Popular alienation and democratic concerns
3.	The dual legal expression of subsidiarity at Maastricht
(a)	Discovering the objectives of the Community
(b)	The formal scope of subsidiarity:  identifying ‘non-exclusive’ competence
(c)	Integrating proportionality
	
III.  Fleshing out the subsidiarity concept:  The Amsterdam Protocol

1.	When is Community action appropriate?
2.	Linking subsidiarity and proportionality
(a)	softer forms of law and shared policy-making
(b)	The proceduralisation of subsidiarity:  reasoning, consultation and reporting
(c)	Subsidiarity and the inter-institutional dimension

3.  Subsidiarity and the Court of Justice

IV.  Conclusion

I. Introduction

1. Setting the context

Over the past decades, two separate and apparently opposite trends in government and governance have been the subject of considerable analysis. The first reflects the internationalisation or globalisation of government in certain spheres, with an increasing number of issues being allocated to or addressed by international and supranational levels of authority. This pattern has generally been explained on the basis that the capacity of individual nation states to address the issues in question is no longer adequate or accepted, (in economic language, for example, that there are negative externalities which cannot satisfactorily be internalised within the nation state) or because there are perceived to be advantages of scale, influence and increased effectiveness in action beyond the level of the state.  A second trend at least within western political systems is that of localisation, in the sense of the emergence of stronger local and regional politics, with a renewed interest in more direct democratic participation under the influence of republican and communitarian political theories.  
	One of the factors which these two apparently divergent developments have in common is that they illustrate the erosion of the assumption that the nation state is the primary and most appropriate locus of authority for political decision-making.  The increasing interdependence and interconnectedness of nations, both as a result of voluntarily undertaken international obligations and the establishment of international institutions of varying degrees of power on the one hand, and as a result of the transnational activities of economic actors and the unplanned transboundary effects of many social, political and market activities on the other,  pose a powerful challenge to the claim that national governments are best placed to decide upon and to regulate most matters of political importance. Secondly, factors such as a growing popular alienation from and disenchantment with traditional national democratic processes in the west, and a degree of fragmentation of political authority within nation states, seem linked to an increasing demand for more participatory political systems and in particular a more active role for local and regional levels of government. This decreasing centrality of the nation-state level of government must also be considered in the light of a third emergent trend which involves a more general fragmentation of political power, and the dissolution of boundaries between private and public spheres of regulation and control.  It concerns the evolution, in other words, of a concept of governance which transcends the more traditionally conceived private/public divide and which challenges previous (even if misplaced) assumptions about the locus of political and economic authority.
It is within the broader context of these developments that the debate on subsidiarity within the European Union should be situated, although that debate is sometimes conducted as though its political origins, significance and impact were confined within the geographical boundaries of the fifteen Member States, and within the textual boundaries established by various EC and EU Treaty provisions. The notion of subsidiarity is clearly a political and legal principle which was adopted and developed within the EU to address issues of competence and the exercise of power as between the Member States and the European institutions. But it can also be more broadly understood as part of a language which attempts to articulate and to mediate, albeit within this particular geographical and political context, some of the fundamental questions of political authority, government and governance which arise in an increasingly interlocking and interdependent world.  As Held has aptly commented, “the very process of governance seems to be ‘escaping the categories’ of the nation state”. 
2. ‘Appropriateness’ and levels of decision-making:
	Rather than pointing to extreme conclusions such as that the nation state is being rendered redundant as a centre of government, however, the varying patterns and trends in economic and political activity and organisation in recent decades may instead be seen to pose challenging questions about what the “appropriate” level of decision-making for any given type of policy may be, and how this notion of appropriateness should be conceived.  It is evident that there are different, although not necessarily mutually exclusive, ways of approaching the question. One would be to focus on issues of process, in other words to examine the type of decision-making procedure which is likely to take place at a particular level or within a particular forum, and at who the parties involved in such decision-making are likely to be. Democratic concerns such as the desire to ensure adequate participation by, or representation of, those who are affected by the decisions in question are central to this approach, and the notion of appropriateness is considered by reference to these. A second perspective would focus not on method or process, but primarily on outcome, by asking whether a decision taken or a policy formulated at a given level is likely to be effective in dealing with the issue it was designed to address.  This approach concerns the capacity of particular levels of government or political organisation to address certain types of  issue. The notion of effectiveness itself suggests various other criteria, such as whether a given level of government is in the best position, geographically, or in terms of access to information or otherwise, to assess, to understand and to act on the matter in question. A further and somewhat more contingent aspect of the question of appropriateness relates to the willingness of particular political fora to take action in certain matters. 
Any analysis of the question of appropriateness, however, will be dependent on how a given issue or policy is specified.  The more broadly and generally a particular policy area is defined, the more difficult it is to say, whether by reference to process, outcome, or willingness to act, which level of government would be the most suitable, or whether the matter would best be regulated “privately”.  Further, the discussion so far seems to presuppose that it may be possible to point to one particular level of government, be it local, regional, national, transnational, international or supranational, which is best placed to decide on a particular matter. Yet one of the features of today’s complex international political and economic environment, and more particularly a feature of the multiple-level and multiple-layered polity which the European Union has become, is that it is increasingly difficult to specify any one level of authority which should be exclusively or solely empowered to decide on a given matter.  The phenomenon of competence and power being spread across a number of different levels of government, and shared between a number of different actors, within the same general policy area or even in the context of a specifically defined policy issue, is increasingly evident. 
3.  Exclusive compartments or overlapping spheres?
It might be asserted, for instance, that matters concerning what we conceive of as human rights are best debated and resolved at the level of the nation state, which has the information, the capacity and the political legitimacy to intervene. Yet it can equally well be argued that given the political pressures and tensions which frequently arise within a given nation state, an international institution which is less mired in the immediacy of a local political situation is the more appropriate actor in certain human rights matters, since it is more likely to have the will, the independence, the wider experience and the normative authority to act.  Ultimately, the conclusion may be that the nation state is the appropriate locus of authority for addressing certain human rights questions - e.g. for articulating and defining the constitutional values and institutions for protection within that particular political and geographic community, and that an international institution may be the appropriate level for acting in other matters, such as in monitoring the way the nation state purports to give protection to certain minimum-level rights, or by censuring certain types of action in that field.  Or the conclusion may be that while an international level of authority is best placed to evolve and articulate shared international values and standards of protection for human rights more broadly conceived, it is for the nation state, or even for more regional or local political actors to determine how those standards will be observed and implemented in concrete situations. Thus the authority may be spread across different levels of government, with an inevitable interaction between those different levels and actors in adopting and carrying through a particular policy in a given sphere.  Another example could be taken from the field of environmental policy, where the development of policies to combat global warming might be best undertaken at the international or supranational level, whereas planning decisions as to the preservation of “greenbelt” areas or on the zoning of land are more appropriately adopted at national or local levels.  Further, there will be single issues which ought to be decided co-operatively between different levels of government, the central or international level setting out general standards to be attained at national and local level, and those “lower” levels of government then deciding on how to implement the general objectives in the particular context.
	One of the puzzling and frustrating features of the subsidiarity debate however, in particular in the European Community context, is that it has largely been conducted in terms of identifying spheres of “exclusive” competence on the one hand - those which are said to be exclusive either to the Community or to the Member State - and on the other hand identifying spheres of shared or concurrent competence. The identification of these different spheres or categories is supposed to resolve many of the questions concerning the appropriate level of government for the various policy fields mentioned. However, as can be seen both from examining some of the strongly opposing views and the confusion within the debate about spheres of exclusive Community competence, and by referring to the experience of other federal systems, such classifications tend to be artificial and crudely drawn, and do not themselves resolve the question of appropriateness when it arises in particular concrete policy situations. It will be argued below that the notion of exclusive competence on which the legal articulation of the subsidiarity principle in EC law appears to rest is inherently problematic and uncertain, and does not address the real questions which are raised about the appropriate arena for action in the context of multiple levels of government and multiplying dimensions of governance.
4. Internal and external dimensions
	Questions concerning the division of policy competence and the exercise of power at different levels have always arisen within federal political systems, either in the nation-state context or in the context of more recently constructed supranational systems such as the European Community and Union.  These questions, however, are increasingly outgrowing such categorisation, as the relevant centres and dimensions of political and legal decision-making grow in number and complexity.  Thus it is not only local and regional entities, along with nation states and supranational players such as the EU which play a role in governance, but also international and transnational  public and private fora of different kinds which exercise power in various contexts. While it is clear that the existence of private spheres of governance which are either tolerated and legitimated by the state or which are otherwise resistant to state control is far from new, it is the combination of this phenomenon with the undoubtedly more recent increase in transnational linkages, and in particular with transnational economic organisation and activity, which calls for renewed analysis and reflection.  The increasing trend towards the dispersal of power and the fragmentation of decision-making authority both within and beyond the nation state calls for an understanding of subsidiarity - both subsidiarity upwards as well as downwards - in the EU context which is both wider and more nuanced than has sometimes been the case in the past.  It is not only a question of recognising when the Community/Union should yield to or share decision-making power with national, regional or more local levels of government which are ‘nearer’ the citizen, but also when the EU itself ought to act within the constraints of international decision-making, and when it is appropriate to concede that decision-making must take place in a wider context and within the framework set by entities such as international environmental summits, the World Health Organisation, the World Trade Organisation and some of the increasingly influential standardisation bodies such as Codex. To focus mainly on the internal constitutional division of power and responsibility within the EU, without taking adequate account of the increasingly important external dimension of EU action is to gain a limited and partial picture only. This kind of ‘reverse subsidiarity’ or ‘subsidiarity upwards’, as it has been termed, is also an important aspect of the debate about appropriate levels of governance in the context of the European Union.
II.  The adoption of the subsidiarity concept into EC and EU law
1.Seeking definition:  legal and political dimensions
This paper has as its central subject the notion of subsidiarity within the European Union, and seeks to explore the set of issues embodied in that concept.  The legal debate on subsidiarity has concentrated, unsurprisingly, on an analysis of the relevant textual provisions, although there has also been a broader if less focused political debate on the meaning and significance of this concept.  A widely shared view amongst lawyers has been that the impact of the subsidiarity principle on EU legislative policy and on the conduct of the decision-making institutions is likely to be slight, given the malleability of the provisions outlined in the Treaty, the difficulty of ensuring compliance even if agreement on the meaning of these provisions were to be reached, and the improbability of judicial review playing any significant role in this respect.  Others, however, have considered whether the more general symbolic and political significance of the principle reflects a potentially important change in political and legal culture and suggests a move away from the centralising tendencies of the EU in the past.  In this paper, both the legal and the broader political dimensions of the subsidiarity debate will be addressed, in an attempt to appraise the overall significance of the ideas expressed by this concept within the EU process. The question whether the introduction of subsidiarity as a formal norm of EU law has made any concrete difference is not an easy one to address, given the difficulty of identifying or imputing such causal impact. Examining the role of subsidiarity as a procedural norm, however, it will be suggested that one of its significant legal functions is the imposition of a certain onus of justification - a kind of public reason requirement - on the various EU institutions when they act. It is important however that this quite specific and legalistic conception of subsidiarity is understood and situated within the more general framework of the changing EU polity and within the wider international context also.  
Further, although the legal articulation of subsidiarity within the EC Treaty and its protocols focuses on the respective roles and competences of the Community and the Member States only, and on the Community legislative institutions rather than on its judicial branches, the significance of the principle and the ideas it represents are, arguably, not so limited in practice.  There are two aspects to this argument. The first is that although the legal expression of subsidiarity is rather narrow, in that it purports to apply only to the sphere of so-called non-exclusive competence, and only in relation to the division of powers between the Community and Member State levels, its potential relevance and influence in practice is not confined by these legal limits. The ambiguity inherent in the notion of exclusive competence, the wider reality of institutional practice, and the conflation of the notions of subsidiarity and proportionality in the protocol attached by the Treaty of Amsterdam, all suggest a role for and usage of the subsidiarity concept which is more widespread in practice and which transcends the formal boundaries established by the primary legal formulation in Article 5 (formerly 3b) EC.  If the use made of the subsidiarity concept in political debate, in inter-institutional dialogue, in litigation by a range of parties, and in various Community policy documents and legal instruments is examined, it is possible to claim a more general significance for the concept. The second aspect, as I have argued elsewhere, is that the reasons for the introduction of subsidiarity as a formal norm of EU law, reasons which include the fear of excessive centralisation and of inexorable increase in Community action and influence at the expense of other and “lesser” political units, are not necessarily limited in their application to the European legislative institutions.  They may be equally relevant to any of the policy actors -including the European Court - which are capable of extending and enhancing the reach and influence of Community law.
	One of the difficulties in discussing the meaning and significance of subsidiarity within the EU is that, while it has generated much contention, debate and a great many pages of legal and political analysis,  there is a general consensus on the fact that it is characterised as a concept by a high degree of fluidity and vagueness.  This is not, however, a reason for dismissing or underestimating the significance of the concept.  European law has, as every EC lawyer knows, a rich tradition of evolving through the aid of such “weaselwords”, in the sense of terms which are ambiguous and open, and which are even chosen for these very characteristics. Many other examples can be given of terms which are highly significant within the EU legal and political context, but which remain nonetheless or even deliberately uncertain in scope and meaning: ever closer union, exclusive competence, the internal market, and the acquis communautaire, to name but a few.  Political bargains which may be arduously negotiated between parties with very different priorities and aims are frequently encapsulated in language which is not only open to differing interpretations, as all language is, but which is specifically chosen to mediate between very different understandings and conceptions of the issue under discussion.  Such compromises have been a key feature of EU law and policy-making over the years, appearing not only in secondary legislation and in softer forms of law, but also in key constitutional texts and treaty amendments.  That language, of course, in no sense remains the ‘property’ of, or within the control of the negotiators or the drafters, but is interpreted, used and extended by the various actors who purport to be governed by such texts: including the EU institutions, the Commission, Council and Court, the national courts and national political and private actors.  The meanings which emerge from this process of interpretation and usage may alter the nature of the bargain which was broadly thought to have been agreed when that language was chosen, and may crystallise into something less fluid and more concrete than that which first appeared to be the case. The Commission, for example, has given various definitions of exclusive competence, the acquis communautaire and the internal market sphere in its communications. And although these are not themselves legally binding, and it is formally speaking the Court of Justice which has ultimate interpretative authority to determine the legal scope of these terms, it is unquestionable that the meanings used, attributed and acted upon by other actors, including the Commission, have influence in practice.
This process of compromise over a contested term has been clearly evident in the context of the subsidiarity principle, which, it has often been pointed out, signified different things to the different actors involved in negotiating the Treaty on European Union in which it first appeared in a general legal form. Yet despite predictions as to its meaninglessness and vacuity, the term has thrived and spread within EC and EU law discourse, and subsidiarity has arguably developed into a more defined, albeit still vigorously contested notion. Much of EU constitutional law has been taken up with the search for ways of resolving the tensions and balancing the interests of integration and differentiation, of harmonisation and diversity, of centralisation and localisation or devolution. The notion of subsidiarity can be seen as yet another conceptual space in which this balance can be negotiated, as a language through which the ongoing debate is channelled.
It is undeniable that the legal articulation of subsidiarity within the EC Treaty, and to some extent its elaboration and linkage with the proportionality principle in the Protocol added by the Treaty of Amsterdam, is focused principally on the relationship between the Member State level of government and the EC level and suggests a degree of closure in this respect. However, it is also clear that the invocation of subsidiarity both as a rhetorical device to legitimate certain institutional practices and more instrumentally in explaining certain legislative and policy choices, or in the use of softer more ‘flexible’ forms of law, or the practice of involving actors at different subnational and transnational levels, or the invocation of the principle in litigation (eg the argument of the applicants in the CFI social partners case) give it a broader significance in practice. Further, the more diffuse notion of decision-making which takes place “as closely as possible to the citizen”, which appears elsewhere, albeit in the introductory general provisions of the Treaty on European Union rather than in the more clearly justiciable and ‘harder’ EC Treaty provisions, implies that EU law is concerned not only with ensuring appropriate action at the level of the Member States, but also at any level which brings decision-making in some way closer to those who are affected.  Thus even if the primary legal discourse of subsidiarity is focused on the issue of resolving questions of Community-Member State action, it is also clear that within the EU, law-making power is exercised and decisions are taken by an array of actors and institutions, both public and private, across the range of policy areas covered by EC and EU law.  Bodies such as the standardization committees,  the social partners, the national central banks, association councils, to name but a few, all play a relatively institutionalised role in the process of EU law- and policy-making. The discussion below will attempt to identify not only the scope, use and possible impact of the narrower legal-textual formulation of the subsidiarity principle, but also some of the effects of the wider usage of this concept to explain, legitimate and further other practices and the involvement of other actors and bodies within EU law and policy.
2. Popular alienation and democratic concerns
One consequence of the increase in the number of international and transnational organisations and institutions (such as the EU, the World Trade Organisation, the United Nations, and NATO) which effectively govern many aspects of economic and political life along with the low profile or opacity of some of the other policy-making entities outside of the realm of high politics (such as the various transnational standard-setting and regulatory bodies) is an increase in the distance and the degree of alienation of individuals from the processes of governance affecting their lives.  The traditional structures and processes of the democratic nation state, and the broadly shared cultural and social context within which they have operated have, in the past, enabled domestic problems of alienation and disaffection to be relatively contained and mediated within those internal structures and processes. The internationalisation of economic and political activity, however, has not been accompanied by the development or emergence of a transnational political and social community in any real sense, even if a number of relatively successful sectoral transnational alliances and networks have been established in particular areas.  It has been pointed out that “people are less mobile than money, goods or ideas; in a sense they remain ‘nationalized’, dependent on passports, visas, and residence and labour qualifications” and that the EU nation states remain the crucial locus of political legitimacy and democratic accountability: “national-level politics and citizen identification remain compelling”.  In more familiar language, not only the establishment and growth of the EU with its dominant single-market core, but also the process of economic globalisation more generally has resulted in the emergence of an expanding and strengthened “market without state”, with all of the resulting problems of democracy and legitimacy which that development suggests.  Political communities remain largely located at the national and subnational level, even while an increasing number of the relevant decisions and policies which concern them directly are made outside the structures and processes of that political community.   It was partly a combination of such national concerns over the loss of political authority at Member State level, over the negative impact on domestic political life of the perceived degree of popular alienation from and opposition to the EU, and the lack of an adequate political community at EU level, which influenced the decision to introduce subsidiarity as a formal norm into the EC Treaty in 1992.  Some of the reasons why these concerns led, at the particular time they did, to the concrete step of incorporating it as a legal principle have been suggested by those who have analysed the processes of Treaty-making and bargaining represented by the Intergovernmental Conferences within the EU context.  The aim of the current discussion instead is to question and consider now, six years after its introduction, what the implications and outcome of that decision have been for the EU.
3. The dual legal expression of subsidiarity at Maastricht: Article 5 (3b) EC  and Article 1 (A) TEU
Following what was described at the time as an ultimately unstable compromise influenced by at least three different ideological sources - conservative British concerns about national sovereignty and the loss of state control, Christian Democratic/Catholic social philosophy concerning the importance of allowing lower units of authority to achieve their own ends, and German regional politics based on the constitutionally protected competences of the Länder - Article 5 (formerly 3b) was inserted into the EC Treaty.  The argument of Van Kersbergen and Verbeek was that these different and actually conflicting influences doomed the subsidiarity principle to a short existence. They took the view that the principle may have been a tool to facilitate compromise at a difficult moment in the IGC process, but that it failed to provide any real criterion for specifying which competences should be exercised at which level and simply postponed political confrontation. One of the arguments of this paper is that the subsidiarity principle in fact can not only be seen to have survived these conflicts of interest, but also that the language and ‘culture’ of subsidiarity can increasingly be seen reflected in different ways throughout the EC law and policy process.  This does not amount to a claim that the formal incorporation of a legal principle into the Treaty has had demonstrable causal effects, but rather that in a reflexive way, the changing political and legal culture within the Community and Union was both embodied in and contributed to by this formal constitutional step. If it fails to provide “a real substantive criterion” for delimiting competences and the exercise of power, this is not necessarily because the language of subsidiarity or of Article 5 (3b) is inherently flawed, but rather because the set of questions underlying the decision as to which forum or level of authority is appropriate to decide on particular policy issues is many-faceted, complex and not readily reducible to an operative legal formula. Equally, the failure to provide a clear or objective legal criterion does not necessarily mean that the range of concerns underlying the introduction of the principle of subsidiarity have been without legal and political impact within EU policy-making. 
Much has been said about the different versions or expressions of subsidiarity to be found in Article 1 (previously A) of the Treaty on European Union and in Article 5 (previously 3b) of the EC Treaty.  While the latter, which is the formally justiciable expression of the principle, refers only to the exercise of power on the part of the Community institutions or the Member States (reflecting the UK’s national sovereignty-inspired view), the former, which is in a part of the Treaty on European Union over which the Court of Justice was not given interpretative authority, speaks of decisions which are to be taken “as closely as possible” to the citizen (reflecting aspects of the Christian Democrat philosophy including respect for smaller units of government and the position of the individual).  This broader conception of subsidiarity - which has variously been termed democratic or full-blown subsidiarity - is also reflected in the recent declarations made by the German, Austrian and Belgian governments at the Intergovernmental Conference on the Treaty of Amsterdam. Further, the formal non-justiciability of parts of the Treaty on European Union does not necessarily mean they will be without practical significance nor that they cannot be attributed legal effects by the Court.  The ECJ has not refrained in the past from drawing on non-justiciable provisions of the TEU (and particularly not where there is a potential overlap with important justiciable parts of the ‘first pillar’ as in the Airport Visas case) and with the increasing mixity and linkage between the Union and Community pillars, the distinctions in legal influence and effectiveness of the respective provisions are likely to become increasingly blurred.
It has been argued also that there is a necessary relationship between the narrower legal formulation of subsidiarity in Article 5 (3b) and the democratic expression of subsidiarity in Article 1 (A), given that the general principle in Article 1 on closeness to the citizen purports to govern the Union as a whole, including the Community, so that the more precise criterion in the EC Treaty must be interpreted within the context of that general principle in the TEU, with its preference for lower-level decision-making.  This touches on what has been referred to in the US as the distinction between democratic subsidiarity and executive subsidiarity, each conception reflecting a different view about the aims and purposes of federalism.  From the point of view of democratic federalism (or what we might in the EU context call democratic subsidiarity) it could be said that the aim of an appropriate distribution  of and regulation of the exercise of power between levels of government is the protection of citizens’ rights, rather than the protection of executive prerogatives.  And certainly in the EU context, the rhetoric of citizens’ rights and closeness to the citizen is regularly invoked, although what appears in the primary legal text is the executive version, with subsidiarity as a principle appearing to protect Member State powers against encroachment by the Community organs rather than to protect individual rights and interests in the making of policy.
It is Article 5 (formerly 3b) EC which contains what might be called the hard legal core of subsidiarity - the binding, enforceable and justiciable expression of the principle within primary EC law. This article is a three-part provision containing first, an express articulation of the limited competence of the Community, secondly a statement of the subsidiarity idea proper, and finally an expression of the principle of proportionality which was already familiar within the EC legal system as a constitutional and administrative principle.  However, despite this provision - by comparison with the “softer” formulation in Article 1 (formerly A) TEU - being the clear legal core of subsidiarity, it is evident that each part of Article 5 (ex 3b) is characterised by a substantial degree of ambiguity and openendedness.  
(a)  Discovering the objectives of the Community
The first part of the Article sets out the familiar principle of limited Community competence, declaring that 
The Community shall act within the limits of the powers conferred upon it by this Treaty and of the objectives assigned to it therein.”
It is of course apparent to any EC lawyer that not only are the limits of the Community’s conferred powers very difficult to specify with any degree of certainty, but also that there is no agreement even as to the objectives which can be said to be assigned to the Community. Article 5 does not attempt to clarify these issues, nor to articulate any more precisely what the scope of the Community’s conferred competence is, whether there are areas over which the Community has sole competence to the exclusion of Member State action, what the areas are in which it shares competence with the Member States, nor whether there are areas in which it simply lacks competence.  It was evidently decided - in particular leading up to the signing of the Amsterdam Treaty in 1997, since this was one of the possibilities mooted during the preceding Intergovernmental Conference - not to attempt to include an express list of competences in the EC Treaty.  Although this solution has been adopted within other federal constitutions, such as Germany’s, the exact division of powers and competences at EU level has, to date, been left to be determined rather more fluidly, by a mixture of action and initiative on the part of the relevant Community organs which can then be challenged during the political process or ultimately before the Court of Justice if there is opposition.
It needs no reminder that the terms of the EC and EU Treaties remain very general and open-ended, that the nature of the powers conferred are often broad and imprecise, and that there are few - if indeed any - absolute exclusions of Community competence from a general policy sphere. All that can be said is that there are some areas of policy which are more clearly and more expressly within the remit of the EC, and others which are at best only marginally or tangentially so.  This can be seen in some of the inter-institutional debates over the scope of Community competence in the more recently added and so-called flanking or supplementary policies, such as those of education, culture, public health, and energy.  The European Parliament for example, in its resolution on a number of the Commission’s reports on subsidiarity,  expressed its concern over the fact that over a two-year period, 1994-1996 “questions relating to subsidiarity were systematically raised in relation to initiatives taken under new policies, in particular in the fields of culture, the audiovisual sector, energy, research, the protection of health, consumers and the environment”, and felt that this showed a danger of weakening Community law and the acquis communautaire. Yet these are clearly areas in which others - and particularly various national ministers represented in the sectoral Council meetings - feel that the principle of subsidiarity should have a strong role in restraining any Community zeal for centralised action.
On the second point raised by this first sentence of Article 5 (ex 3b), namely what the objectives assigned by the Treaty to the Community are, there is considerable disagreement, despite the articulation of a list of objectives in Article 2 EC and a list of activities in Article 3, over what exactly these objectives comprise. A recent example of this confusion is to be found in the area of human rights, more specifically over the question whether the Community has competence to take action under Article 308 (formerly 235) of the EC Treaty to promote or protect human rights.  What Article 308 requires, in order to serve as a legal basis for action, is that there be an objective of the Community which is necessary to attain in the course of operation of the common market, and a lack of adequate power granted under the Treaty to attain this objective. However, the Court of Justice’s failure to state one way or another, in Opinion 2/94 on Accession of the EC to the ECHR, whether or not protection of human rights was a Community objective, has led to lively academic debate on this point.  It could be argued - by analogy with Directive 76/207 on equal treatment for men and women, which was adopted under Article 308 (ex 235) EC by asserting that equality between men and women was an objective of the Community even where that broad objective was not expressed in the Treaty itself at the time, but only the more limited equal pay principle in Article 141 (Article 119 at the time of adoption of the Directive) - that protection for human rights is, as reflected more specifically in the development policy provisions of Article 177 (previously Article 130u) EC and more generally in the umbrella provision of Article 6 (formerly Article F) TEU,  an objective of the Community. But it would also be possible to make an argument that this is not so, and that while it is a condition for the lawfulness of other Community action, protection for human rights has not in itself acquired the status of an independent, positive Community objective, but remains primarily within the sphere of competence of the Member States.  This lengthy example is given only to illustrate the point that the first part of Article 5 (ex 3b) on the limited, attributed competence of the Community to achieve its “objectives” raises as many questions as it answers, and provides little guide to the boundaries of the Community’s powers of action.
(b) The formal scope of subsidiarity:  identifying ‘non-exclusive’ competence
The second part of the Article is a more complex section which focuses specifically on the subsidiarity concept, and contains a number of different requirements:
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
One feature of this provision which is immediately apparent is that the sense of subsidiarity elaborated here is not the broader idea of “closeness to the citizen”, nor one which takes in the ‘upwards’ perspective of levels and sites of authority outside and beyond the EC/EU. It does not reflect the philosophy of allowing smaller units to define and achieve their own ends, and refers only to two levels of authority: that of the nation state and that of the Community. The provision first expresses a minimum notion of effectiveness or adequacy, in the sense of whether an objective can be sufficiently achieved by Member States acting alone. If the objective cannot sufficiently be achieved by the Member States acting individually, then the action would presumably not be effective. Secondly the provision expresses a less minimal and more relative notion of effectiveness (which is to be read cumulatively with the first), in the sense of how much better the objectives of that action can be achieved at the Community level.  The criteria for measuring how much better they can be achieved are described in terms of outcome only - by reference to the “scale or effects” of an action - rather than by reference to the nature of the decision-making process or to any other criteria of appropriateness.  In other words, the only levels or fora of decision-making contemplated by this paragraph are the Member State and the Community level, and the only criterion given for determining which level is appropriate is one of outcome or effect, rather than process.
	A second key feature of this paragraph, which lays down the legal field of application of the subsidiarity principle, is that the question whether action cannot be effectively adopted by the Member States and can be better achieved by the Community, is made relevant only when the area is not one over which the Community has exclusive competence.  Combining this with the first paragraph of Article 5 (ex 3b), it seems clear then that subsidiarity has no formal legal relevance either when an area is altogether outside the Community’s competence and within the competence of the Member States, or when the area is outside the Member States’ competence altogether and falls within the exclusive competence of the Community. This appears to confine the compulsory scope of application of the subsidiarity principle in Article 5 (3b) to those policy areas in which the Community and the Member States share competence, in which each potentially has the power to take action.  This is why it is said that subsidiarity is not about determining or defining the competences of the Community, but instead that it purports only to provide some kind of guide to the exercise of the Community’s existing powers (whatever they may be), and that as a principle it regulates only the exercise of those powers in the policy areas which the Community shares with the Member States. 
	However, it was seen above in examining the first paragraph of the Article which concerns the supposed sphere of exclusive Member State competence in which the Community has no power to act, that this is a very difficult, if not impossible sphere to define in practice.  Not only is it extremely difficult to delimit the actual objectives of the Community by reference to the Treaties, but even when it seems unlikely that the Community could have legislative competence to intervene in a particular policy sphere - e.g. such as to regulate the provision of abortion, or to provide for the conditions in domestic jails - it is rarely impossible to envisage a situation in which such policy areas could fall to some degree within the Community’s regulatory remit.  The Grogan case demonstrated how a slight variation in factual circumstances could bring the cross-border provision of information on abortion within the scope of the Treaty provisions on the free movement of services, and it requires only a small step further to imagine how a case for minimum-level Community legislation on such information provision could be made out.  And even in relation to the more unlikely issue of prison conditions, the treatment in the jails of another Member State of EU nationals whose Community rights of free movement within that state have been restricted could conceivably fall within the scope of EC law, and looking to possible future developments, the provisions in the new post-Amsterdam EC Treaty title allow for more systematic Community action in the field of police and judicial co-operation in criminal matters.  In other words, it is no longer possible to say with any certainty that an area of policy falls entirely outside the sphere of Community competence, and therefore that the principle of subsidiarity has no necessary relevance to action in that policy field. This is not by any means an argument for unlimited Community competence. Rather it is an acknowledgement of something that is increasingly hard to deny:  that there are in fact no clear boundaries to the Community’s potential competence and that any formal legalistic boundaries we may try to erect will be constantly changing and shifting; and that it would be more realistic and more sensible to consider openly the cluster of ‘appropriateness’ issues which underlie the subsidiarity question whenever action is needed in an area in which either the Member States or the Community may have the capacity or the desire to act.
It is equally arguable that the second legal limit on the formal scope of application of the subsidiarity principle, in other words its apparent non-application to those areas which are said to be exclusively within the competence of the Community, is a notional limit only. The debate over the meaning of “exclusive” Community competence has been lively but entirely inconclusive. While the Commission, in its 1992 report and communication on subsidiarity expressed fairly clear views about what was within the scope of exclusive Community competence - declaring that the implementation of the four freedoms of movement “lie at the very core of the Community’s exclusive powers”, this can readily be understood as an inevitable attempt by the Commission to protect a large swathe of Community policy-making from subsidiarity-inspired challenges. The Commission has argued that when the Community is under a duty to act and has been given the responsibility to take action in a particular field, it has exclusive competence in that sphere, which includes not only the free movement core of the internal market, but also the common commercial policy, agriculture, competition, transport and fisheries conservation.  No sooner is this list considered, however, than it is apparent that these policy areas cannot be entirely outside the scope of Member State competence. The regulation of banking, for example, is undoubtedly of central relevance to ensuring the free movement of services and freedom of establishment within the Community, but this is equally undoubtedly an area in which both the Member States and the Community share competence.  The same can be said of countless other apparently core “internal market” issues.   What is clear is that once Community action has been taken on a given matter, the Member States are prohibited from acting on that very same issue, and that if they do, the principle of supremacy should ensure that the Community measure takes priority. Further, if the Member States do adopt action on that issue or on a related issue, they must make sure (as they are required to by the principle of loyal co-operation in Article 10 -formerly Article 5 - EC) that their measures are in conformity with Treaty obligations more generally and do not jeopardise any other Community policies. The notion of pre-emption - that once the Community has acted within a sphere of supposedly exclusive competence, the Member States can no longer act unilaterally within that field – is increasingly difficult to apply and is problematic as a conceptual tool for understanding the respective spheres of action of Community and Member States. However, it is not at all clear what, if anything, this notion of exclusive competence adds to the principles of supremacy and the principle of loyal co-operation.  Further, we find that in practice there are numerous instances of ‘subsidiarity clauses’ or subsidiarity-type reasoning (even the express term is not used) in legislative measures which fall within core areas of Community competence - and which the Commission certainly considers to be spheres of exclusive Community policy, which indicates that, whatever the formal legal position may be, the legislative bodies do not necessarily treat the subsidiarity question as being irrelevant to decision-making within these spheres.
Indeed, the argument of this paper is that, just as in the case of the notion of an area of exclusive Member State competence, the idea of an area of exclusive Community competence is a confused and uncertain one which ultimately adds little to any attempt to understand or operationalise the subsidiarity principle. It can of course be argued that the closer a particular issue is to an area of policy which is traditionally at the core of national sovereignty and far removed from the original express aims of the Community, or the closer it is to the core common market goals of the Community, the less room there is likely to be for serious or prolonged consideration of the subsidiarity question - i.e. the question which level of decision-making would be more appropriate for action.  There are other issues, too, such as many of those within the scope of the External Commercial Policy, which are closer to the core of the Community’s objectives and which allow little room for Member State action. But to isolate broad issues, groups of issues, or general policy areas, and to categorise them as belonging exclusively to the sphere of Member State action or exclusively to the sphere of Community action, is ultimately unrealistic and simply avoids the set of questions (those which underlie the subsidiarity inquiry) which may need to be asked about the appropriate level and forum for action.   The relevance of the subsidiarity inquiry cannot be excluded by defining general policy areas like “agriculture”, “free movement of goods” and “competition” on the one hand, or areas like “crime”, “family law” and “welfare policy” on the other hand, and deeming them to be either for the Community alone or for the Member States alone to decide on.  Rather the answer will depend on the precise kind of policy issue in question, and it may well be that certain issues which may affect the free movement of goods (such as the regulation or banning of soft drugs) are most appropriately decided by Member States acting alone, whereas certain issues relating to the family (such as the treatment of non-national spouses or children) need to be regulated at Community level.
In other words, despite their detailed legal provisions, the first two paragraphs of Article 5 (formerly 3b) EC do not provide an objective criterion or a useful standard for deciding on the appropriate levels of decision-making. It is extremely difficult, and, it is argued here, ultimately not helpful in addressing the issues and questions which underlie the subsidiarity concept, to declare certain areas to be areas within exclusive Community competence and others to be areas within exclusive Member State competence.  Particular policy issues need to be dealt with as they arise, and the question whether a particular issue should be decided at national level or at Community level - or indeed at any other level of political authority, regional, transnational, local or international - will best be addressed individually on their own merits rather than by categorisation in advance within broad policy spheres. 
(c) Integrating proportionality
It is not only the first and second paragraphs of the Article which are interconnected in this way, however.  The third part of Article 5 (ex 3b) sets out what is known as the proportionality principle, which has generally been perceived as something quite distinct from the principle of limited competence in paragraph one or the principle of subsidiarity ‘proper’ in paragraph two.  The traditional understanding has been that paragraph one concerns the existence or non-existence of Community competence in the first instance, that paragraph two concerns whether or not power should be exercised at Community or Member State level once it is established that they do fact share competence in a particular area, and that paragraph three concerns the way in which that power should be exercised once the decision is taken by the Community to act. This third part, the proportionality principle, seems applicable to all Community action and does not appear to be restricted by the notion of non-exclusive competence in part two. Part three of the article reads as follows:
Any action by the Community shall not go beyond what is necessary to achieve the objectives of this Treaty.
Taking this together with the rest of the article, however, it seems difficult to separate the question in the second paragraph - i.e. whether a matter is better dealt with by the Community than the Member States- from the proportionality question here. In other words, although the proportionality question purports to deal with the means by which an objective is pursued, and the second part (“subsidiarity proper”) with whether the objective is best pursued by Community action or by Member State action in the first place, it would often be difficult to answer the second question without knowing what kind of action is envisaged. That is to say, the objective of an action and the means to achieve that action cannot so readily be separated.  This goes, once again, to the degree of specificity with which we articulate a particular policy issue.  We could speak generally of an internal market action, or we could speak more precisely of action in the field of promoting the free movement of services and freedom of establishment, or more precisely again of action regulating the conduct of credit institutions in the various Member States, or even more precisely still of action to ensure the protection of deposit-holders in credit institutions across Europe, or finally we could speak of requiring the compulsory participation by all credit institutions in guarantee schemes providing a minimum level of cover for deposit-holders.  Which of these is to be seen as an objective, and which as an action taken in order to achieve an objective?  The more precisely we define an objective, the more it can also be described as the action taken to achieve a broader objective.  And the more broadly a Treaty objective is defined, the more the action necessary to achieve that objective will itself be broadly defined. It is evident that each of the three parts of Article 5 (ex 3), the principle of limited competence, the principle of subsidiarity and the principle of proportionality are all centred around the notion of the Community’s, or the Treaty’s, objectives. The fundamental open-endedness of this notion both connects the three ideas - the boundaries of the Community’s power to act, the circumstances in which it should exercise its power to act, and the way in which it should exercise that power - and at the same time exposes the fluidity of the legal criteria for determining when and to what extent Community level action is appropriate in a given situation.

III. Fleshing out the subsidiarity concept: The Amsterdam Protocol and guidelines 
Following the inclusion of Article 5 (formerly 3b) in the EC Treaty by the Maastricht Treaty on European Union, and in particular following the initial refusal by the Danish electorate to ratify the TEU (an event which was generally understood to demonstrate the extent of popular hostility in Denmark to the degree of policy activity at Community level and to the further centralisation proposed in the TEU), more detailed guidelines on the meaning and implementation of the subsidiarity principle were agreed by the European Council in Edinburgh in 1992, and these were later incorporated into the Interinstitutional Agreement on implementing subsidiarity in 1993. The momentum towards making the subsidiarity principle a more pervasive part of the Community’s legal and political culture through the inclusion of such guidelines in forms and instruments of increasing legal significance has since continued, culminating in their constitutionalisation in the protocol added to the EC Treaty by the Treaty of Amsterdam (signed in 1997, ratified in 1999) on the application of the principles of subsidiarity and proportionality.
One of the notable features of the guidelines contained in the Protocol is the way in which they proceduralise the subsidiarity principle, as well as further blurring the subsidiarity and proportionality principles. The protocol links the concepts by articulating a series of concrete steps which the institutions - and principally the Commission - should take to ensure that Community action conforms to the principles set out in Article 5 (3b). Paragraphs 6-8 in particular indicate a shift away from seeking clear lines of policy demarcation between different levels of government, with a move instead towards an articulation of procedural guidelines and norms for sharing authority and for shaping the kind of action which may be appropriate at each level.  Thus the way in which the Community should act and the manner in which a given tasks could be shared between the Community and the Member States - rather than only whether the Community should act in the first place - are conceived of here as part of the subsidiarity question. This will be returned to below.
1. When is Community action appropriate?
The ‘prior’ question of whether it is appropriate at all for the Community to act in the first place is, however, also touched upon in paragraph 5, where the idea of the insufficiency of Member State action and its ‘better’ attainment by the Community is elaborated somewhat.  Again there is no mention, in this context, of levels of government other than those of the Community or the Member State - neither levels above the EC/EU nor below the Member State.  The paragraph sets out three guidelines to be examined in determining whether action should be taken by the Community in the areas of so-called shared competence:  first whether an issue has transnational aspects which cannot satisfactorily be regulated by Member State action; secondly whether Member State action or lack of Community action would conflict with Treaty requirements and thirdly whether action at Community level would produce clear benefits of scale or effect.  However, although these guidelines seem to offer slightly more than the terms of Article 5 (3b) of the EC Treaty, it becomes apparent when they are examined that they largely restate the broad political questions in open-ended terms, and do not provide strong legal criteria to answer them. The first of the three is possibly the most concrete guideline, in the sense that the existence of transnational aspects within certain issues can more easily be identified: the example of cross-border environmental pollution was given earlier. Indeed, any issue with relevant significant cross-border effects or implications is likely to be included in this category - e.g. not only the more obvious factors and matters affecting the flow of trade between states and market conditions across Europe, but also issues such as international organised crime have come to be recognised as appropriate subjects for Union or Community action.  However, there is always the possibility that relatively insubstantial or speculative cross-border effects could be used as a reason for acting at Community level. This point has been made in the context of European proposals to harmonize areas of private law:  “cross-border elements should, however, not be misused as a pretext to harmonize fields of private law  which have little impact on the achievement of market integration”.  In other words, determining that there are cross-border effects in a particular area should not in itself be an argument in favour of taking Community action, since the question of whether Community-level action would be appropriate should also depend not only on the nature and extent of these effects, but also on other countervailing issues such as the potentially negative effects of harmonization on local standards and cultures, in addition, to questions of process and democracy.
The second guideline suggested in paragraph 5 of the Protocol for determining whether Community-level action should be taken is whether action by the Member States or the absence of Community action might conflict with Treaty requirements “such as the need to correct distortion of competition or avoid disguised restrictions on trade or strengthen economic and social cohesion”.  However, as a guide to whether or not the Community should take action in a particular field, this is quite a circular provision, which also takes us back once more to the question of how precise the Treaty’s requirements in this respect actually are.  The reference to the need to correct distortions of competition or to avoid disguised restrictions on trade calls to mind Articles 94 and 95 (formerly 100 and 100a) EC, which are the Treaty measures providing for action to approximate the laws of the Member States where this is necessary to ensure the establishment or functioning of the internal market. Yet these provisions - rather like Article 308 (formerly 235) - are a paradigm example of an EC Treaty legislative basis which has been controversial because of its capacity to be used in adopting measures which seem to widen the reach of Community law, or at least to permit an apparently indefinite expansion. The problem is that the terms of the article present few if any constraints on action, and they are premised on concepts which are extremely open-ended and in themselves the subject of political contestation. The “internal market” is a very general notion, and its “proper functioning” could mean many things, depending on how strong a vision of the internal market is being adopted.  Rather like the question whether any given national rule or policy may constitute an obstacle or disincentive to the mobility of workers so as to breach Article 39 (formerly 48) (and see e.g. how the non-availability of childbirth loans to non-nationals was held in Reina to be such, and even the lack of an adequate national guarantee of protection for fundamental rights was argued by Advocate General Jacobs in Konstantinidis to be such)  the question whether certain disparities in economic or social conditions within different Member States give rise to competitive inequalities such as to disturb the proper functioning of the internal market within the meaning of Articles 94 and 95 (100 and 100a) is a highly  open-ended one.  Harmonisation of rules on product liability, on tobacco advertising, and on equal pay between men and women have all been effected by use of these Treaty Articles, although the centrality of such matters to the functioning of the single market could certainly be debated.  The point is that almost any difference in the laws of the different Member States is capable of being construed as a potential distortion in the conditions of competition between states, or as a barrier to the effective functioning of the single market, as indeed the recent political debate over the desirability of harmonising direct taxation in Europe has shown. Guidelines of the kind in paragraph 5 of the Protocol merely show that the desirability or otherwise of expansion of Community activity into certain policy issues, or into certain areas of action, cannot be reduced to “objective” legal criteria or formulae, since these criteria will always be premised on concepts which go to the heart of the political debate about the existence and purpose of the European entity itself: Does the EU remain at heart an essentially economic enterprise? And how far should the logic of a single market be taken?  
It is clear that the internal market provisions of the Treaty have in the past been invoked to propose legislation in areas which are sensitive and which have traditionally been seen as an area primarily within State competence, such as culture.  A good example of this type of legislative initiative would be the Commission’s proposal for a Directive on media concentration, to be based on Articles (52 and 59? 54 and 57?) EC. The free movement of services is undoubtedly an aspect of the Community’s internal market, but the area of culture is one which has only reluctantly and with stringent limits thereon been conceded by the Member States to the Community as an area of potential competence under Article 151 (formerly 128). Clearly, a measure which seeks to harmonise rules on or otherwise to regulate media concentration is designed at least in part to facilitate the internal market in media services, yet at the same time it would clearly be a measure of cultural import in the sense of attempting to ensure media pluralism, the quality of programming and the provision of information.  Whether or not it could be labelled as an “internal market” measure is, in a sense, an irrelevant question, since it is quite clear that it is both a measure which affects the internal market but which also has a substantial cultural dimension, and culture is an area in which the Member States have deliberately stipulated under the Treaty that they shall retain considerable autonomy and that the Community shall have a secondary, supportive role only.  The same can be said of the recently adopted Directive on tobacco advertising, which, although ultimately framed as an internal market measure and adopted under Article 100a (now Article 95) EC, is evidently also concerned with public health and the reduction of smoking. The possible reasons for seeking to label these measures as internal market measures include the fact that Community competence in the alternative fields of culture or public health is considerably more limited, but also the fact that if they are internal market measures they might be said to be part of the Community’s exclusive competence in which the subsidiarity principle is inapplicable.  But to argue that they are within the Community’s exclusive competence is, of course, an untenable proposition, since the areas of culture and indeed also public health are so clearly areas in which respect for the Member State’s role is demanded. Further, the proposed media concentration Directive is quite clearly as much about the media and about culture as it is about the internal market in services, and the tobacco advertising Directive is as much about public health as it is about the internal market, however the recitals to the Directive may be phrased. And even if these are accepted as areas falling within the shared competence of the Community and the Member States, it is clear that the second guideline in paragraph 5 of the Protocol - whether there is a need to correct distortions of competition or avoid disguised restrictions on trade - in fact merely restates part of the political choice which is to be made, rather than providing a guide to the answer.  The question is whether the competitive distortions and trade restrictions which a directive on media concentration or on tobacco advertising would address are such as to justify overriding the interests of “lower units” - such as the Member States and their regions - in retaining substantial regulatory autonomy in the fields of culture and public health.  What the ‘prior’ subsidiarity question should really do is to draw the attention of the Community institutions and others to these choices, to focus their attention on the different values at stake, and to force them to reason their choices openly. They should be required to show, for example, that the interests of national or regional cultural autonomy were taken into account alongside a weighing up of the importance to the Community’s internal market of the kinds of competitive distortions created by disparities in national media concentration laws, and to explain why the degree of distortion in trade caused by different kinds of tobacco advertising regulations in different Member States overrides in their view the specific decision of the States to retain substantial regulatory autonomy in the field of public health under Article 152 (formerly 129) of the EC Treaty.
	Other examples of this kind of weighing of choices and values - and of the importance of making the weighing process explicit - can be seen in the debates over the desirability of harmonising private law rules in the Member States, and over the extent of the need for centralisation of environmental regulation in the Community. Once again it becomes obvious that the subsidiarity question cannot be addressed simply by identifying whether there are competitive distortions or hidden trade barriers which need to be eliminated to ensure the proper working of the single market, since a distortion on competition through the existence of different national standards can almost always be discovered in any policy field. It is almost always possible to point to the danger of a so-called regulatory “race to the bottom” between states which are trying to gain a competitive advantage over one another by gradually reducing the perceived regulatory burden imposed by their laws, if a centralised standard is not adopted. Van den Bergh, in his analysis of whether there is a need for harmonised rules of private law, questions whether there is any real danger of  a ‘race to the bottom’ in this context, and points out that “the ‘unequal conditions of competition’ argument is advanced to justify European legislation in almost any field, ranging from public law…to private law”. What is important, however, is that the extent of the distortions of competition or the danger of a race to the bottom are investigated and some attempt made to clarify them, and then that these dangers are weighed against the desirability (either in terms of the decision-making process, the nature and effectiveness of the outcome or both) of removing decision-making from those other levels of government and acting instead at a central, Community level.
	The third guideline in paragraph 5 simply restates the comparative effectiveness test of Article 5 (ex 3b) EC in essentially the same words, with the minor additional emphasis that action at Community level should produce “clear” benefits by reason of its scale or effects by comparison with Member State action. Essentially, then, the legal expression of subsidiarity in terms of sufficiency and relative effectiveness in Article 5, and the development of these in terms of the three guidelines in paragraph 5 of the Protocol, do not provide clear objective criteria for addressing the issues of ‘appropriateness’ which underlie the subsidiarity issue.  They restate the question in various ways, and provide essentially open-ended and circular guidelines for answering what is unavoidably a multi-faceted political question.  A more revealing, although undoubtedly more politically controversial, set of questions could be articulated instead along lines such as the following:  How strong and how compelling are the internal-market requirements/competitive distortions/trade restrictions/cross-border effects in question?  What precisely are the aims by reference to which the effectiveness of action at a particular level is being assessed? What are the countervailing arguments in favour of Member State action, e.g. such as the decision of the states to specify expressly in the Treaty that they retain national competence over a closely related or overlapping policy area?  What kind of parties would be involved and what kind of decision-making process would take place if action were adopted (i) at Community level (ii) at national (or subnational) level?  Are there alternatives to allocating the decision to be taken at one level or the other only - e.g. could the decision-making be shared between Community and other levels through the adoption of particular kinds of legal instrument or action?
2. 	Linking subsidiarity and proportionality
	(a) Softer forms of law and shared policy-making
This consideration of alternative and more probing ways to pose the set of subsidiarity questions leads us on to the second and more interesting feature of the Amsterdam Protocol which was mentioned above, which is the linkage - in particular in paragraphs 6-8 of the concepts of subsidiarity and proportionality, and the search for ways of sharing policy action and decision-making between different levels of government.  Paragraph 6 concerns the form of Community action and stipulates that it shall be as simple as possible. As regards the types of instrument to be adopted, it is suggested that “directives should be preferred to regulations and framework directives to detailed measures”.  Since directives are instruments which leave more room for – and indeed which positively require - national intervention and action in implementing their aims than most other types of binding Community legal instrument, it is clear from this paragraph that the intention is to encourage the Community, where possible, to set the general outline for action and to leave the Member States to choose their different ways of carrying this through in detail.  The Protocol here is imposing certain constraints on the types of Community action which are appropriate, and although those constraints relate to the form rather than the substance of action, it is of course apparent that the type of instrument chosen is very likely to affect the nature, substance and degree of detail of any given measure. The terms of paragraph 7 make this even more explicit, providing that Community action is to leave as much scope for national decision as possible, respecting well-established national arrangements and the organisation of the national legal systems, and permitting alternative ways for Member States to achieve the objectives of the action in question. In this way, the Protocol’s procedural guidelines as to the form of Community action, which are partly phrased in the language of proportionality – in that “the Community shall legislate only to the extent necessary” – offer an alternative way of conceptualising the subsidiarity question.  Rather than pursuing the doomed attempt to divide general areas of policy into blocks of ‘exclusive Community competence’ and ‘exclusive Member State competence’, or seeking to provide hard legal guidelines for determining whether the Community should act at all, or seeking to confine action on a given issue to one level of government only, this approach focuses instead on the kind of action the Community could take which leaves room for other levels of government to develop and articulate that policy further. This emphasis on mutual co-operation in the sharing of a common sphere of potential authority is evident also in paragraph 8 of the Protocol, in which reference is made to the duty of solidarity in Article 10 (formerly 5) EC, to encourage the Member States, in the absence of Community action, to refrain from acting in any way which would jeopardise Treaty objectives.
(b) The proceduralisation of subsidiarity: reasoning, consulting and reporting
The remainder of the Amsterdam Treaty Protocol deals largely with what might be called the ‘public reason’ requirements of subsidiarity, imposing further procedural obligations on various Community institutions (not including the Court) which are involved in policy-making. A limited attempt is made to address issues of process and participation in decision-making – albeit at Community level rather than national level, since the Protocol avoids prescribing any procedures for the national level of implementation - by requiring the Commission to consult widely before proposing legislation and to publish consultation documents. In this sense, the subsidiarity and proportionality requirements as conceived in Article 5 (ex 3b) EC and in the Protocol are primarily directed towards shaping the behaviour of the Community and its institutions, rather than that of the Member States or any other levels of government. This is so even though the proportionality principle has always been treated by the Court of Justice as an administrative principle which is relevant both to national authorities within the scope of Community law as well as to Community authorities. Certainly if the subsidiarity principle were to be applied to the Member States in the same way as the Protocol suggests it is to the Community, the Member States would also have to consider sharing authority over policy with lower levels of authority, and to examine and reconsider their consultative mechanisms and decision-making processes.
It is notable, in this respect, that the European Parliament in the past has expressed its opposition to the conflation or linkage of the subsidiarity and proportionality principles presented in some of the Commission’s annual reports on subsidiarity, in particular in the way the Commission refers to its use of framework directives and softer forms of law allowing room for Member State input, and to its practice of advance consultation on policy initiatives through the use of green and white papers. Rather than seeing these as alternative ways of respecting the notion of subsidiarity, by developing complementary roles for different levels of  governmental authority and encouraging the input of different actors into the policy-making process through consultation, the Parliament instead perceives such moves as creating uncertain forms of softer law which are insufficiently binding and which might not be adequately transposed at national level, and considers the notification and consultation exercises to be deflecting the Commission’s time and resources away from its more important and exclusive powers of legislative initiative. The Parliament’s conception of subsidiarity, to judge from its 1997 Report and Resolution, is focused on the need for the Community to demonstrate the legitimacy of its actions and to indicate clearly what the Community dimension to a given policy is. In other words, the Parliament considers that the Commission and other Community actors need to show why Community action is necessary and would be more effective than national action in the first place, but that having done this that it should then act strongly and autonomously, rather than using softer forms of framework law or seeking to share decision-making with the Member States, or diluting its energy and commitment to introducing concrete legislation by engaging instead in widespread consultative processes.  The Parliament demonstrates its concern that the subsidiarity concept will be used as an argument for reducing the Community’s policy activity, and also for engaging in softer forms of lawmaking which, unlike most of the legislative processes provided for in the Treaty, might not necessarily involve a role for the Parliament, by arguing in its Resolution that the Commission should not apply the subsidiarity principle in a way which would upset the Community’s institutional balance nor detrimentally affect the acquis communautaire.
Paragraph 9 of the Protocol, which outlines the Commission’s obligations, specifically requires it to justify all of its proposals with regard to the principle of subsidiarity, and to explain any financing of action from the Community budget. The Commission is also required to ensure that any financial or administrative burden, whether on the Community, national governments, local authorities or on economic operators or individuals, is not excessive. Even though it has been criticised as formalistic, the requirement of subsidiarity-specific reasoning (like the general reasoning requirement in Article 253 - formerly 190 - of the EC Treaty) is actually an important one, in that it is designed at least to encourage the institutions - particularly the Commission - to reflect self-consciously about whether a given kind of Community action on a given issue is appropriate, and to force them to articulate more openly how and why they have reached that conclusion. It is a significant transparency-type requirement even though the practice of the Commission and other institutions in this respect could certainly be criticised for being cosmetic and superficial. Even if a “subsidiarity justification” is tacked on ex post facto in a largely self-serving and cosmetic way to the preamble or explanatory memorandum to a measure, that very fact and the unconvincing nature of the reasoning may provide evidence of the failure to take the subsidiarity questions seriously and could also be helpful if a subsequent challenge to the measure were to be mounted. 
The final requirement – a form of accountability requirement - imposed upon the Commission is that it should submit an annual report to the European Council, the European Parliament and the Council of Ministers, which is also to be forwarded to the Committee of the Regions and the Economic and Social Committee, on the application of Article 5 (ex 3b) EC.  It was already the practice of the Commission, following the Edinburgh Council conclusions, to present an annual report on subsidiarity, and it is interesting to note that what the Commission first presented in 1994 was a straightforward report on the application of the subsidiarity principle, whereas in subsequent years it has presented a composite report on “Better Lawmaking”, including not only the subsidiarity and proportionality principles but also reports on the ‘simplification and consolidation’ of EC and EU law.  This development has been criticised by the European Parliament, which has argued that this approach confuses two significantly different sets of principles.  Simplification and consolidation are, in the Parliament’s view, simply “criteria of good legislative practice” whereas subsidiarity and proportionality are substantive legal principles and, in the case of subsidiarity, constitutional principles. This reflects again Parliament’s concern that the subsidiarity principle is being diluted and transformed into something other than a supposedly objective criterion for determining when clear and strong Community action on a particular issue can be justified and adopted by the traditional legislative process involving all of the institutions. 
(c)  Subsidiarity and the inter-institutional dimension of the EC and EU
The final paragraphs 10-12 of the Protocol, which are fairly minimal, govern the responsibility of  three of the other major institutions – the European Council, Council and Parliament – in relation to the subsidiarity principle. The European Council (as a ‘Union’ rather than a Community institution) is required to take the Commission’s annual report into account within its own report to the European Parliament on the progress of the Union. Both the Council of Ministers and the European Parliament are required to consider the consistency of the Commission’s legislative proposals, as well as the consistency of their own respective amendments and the Council of its common position, with the subsidiarity principle. The Commission evidently resents fact that the detailed requirements of the subsidiarity principle seem to be targeted mainly towards itself rather than towards the other institutions or the Member States, as though the Commission were the main culprit responsible for profligate, unnecessary or excessively burdensome decision-making in areas which are better suited to Member State action. In its most recent report on subsidiarity, the 1998 report entitled “Better Lawmaking:  A Shared Responsibility”, the Commission makes much of the fact that responsibility for compliance with the aims of subsidiarity is not borne by itself alone, but is shared between the Council, the Parliament and indeed the Member States.  In its own defence, the Commission asserts that about 20% of its legislative proposals are not entirely of its own initiative, but are made in response to specific requests from the institutions or the Member States. Its argument - which indeed it has made in various earlier reports on subsidiarity - is that these others cannot evade their share of responsibility for having requested controversial legislative proposals such as those concerning zoos, foodstuffs for athletes, animal welfare and health. The Commission asserts also that the legislative texts adopted by the Council and Parliament are more complex than its original proposals, thus defending itself again against the familiar charge that its legislative initiatives are unnecessarily interventionist and detailed.  In this sense the report continues the tendency to which the Parliament has objected, in that the Commission appears to blend  together a number of issues - those of clarity, simplicity, legislative transparency, and the overall quality of legislation, with its practices of advance consultation, ‘impact assessment’ of proposals and more fundamentally its “judicious exercise” of the right of legislative initiative - into a broader conception of subsidiarity as a lighter, more participative, and more careful approach to Community policy-making.
One final point worth noting, in the context of the Protocol’s reference to the European Council as an institution with responsibility in relation to the subsidiarity principle, is that there has been little discussion of the application of the subsidiarity principle to purely ‘Union’ (i.e. pillars two and three) rather than Community activities.  Even in the Protocol - which unlike other protocols is attached only to the EC Treaty and not to the TEU - the involvement of the European Council is in its capacity as the body which gives overall political leadership for the Community as part of the Union,  rather in relation also to action taken under the second and third pillars of the TEU.  There are several possible reasons, however, for the lack of attention which has so far been paid to the subsidiarity principle in relation to second and third pillar, even though Articles 1 and 2 (ex A and B) of the TEU make clear that the principle of subsidiarity should be respected in all of the Union’s activities and that all decision-making, not only Community decision-making, should take place ‘as closely as possible to the citizen’.  A first reason could be that the problems of the second and third pillars thus far have been seen as problems of inadequate and insufficient action rather than excessive or over-zealous action, and that the dictate of restraint implicit in the subsidiarity principle would, as a result, have been unnecessary and inappropriate in this regard.  Secondly, the forms of law adopted under these pillars - joint actions, common positions and the many more traditional resolutions and declarations which have been used - have tended to be very different from the detailed, regulatory, harder legal instruments of the Community pillar, so that the idea of subsidiarity requiring a “lighter touch” or softer, non-binding forms of law, seems superfluous. Thirdly, the primary actors under the second and third pillar, at least before the Amsterdam Treaty amendments to the third pillar, have been the Member States within the Council, and the process of decision-making has been by consensus rather than by majority voting, although the possibility for qualified majority voting in limited areas exists. It seems therefore unlikely, since the Member States effectively retain control over the nature and extent of decision-making, unless a practice of majority voting develops in those areas where it is contemplated by the Treaty, that any of them will seek to invoke the subsidiarity principle.  Of course the fact that the Member State levels of government remain in control does not mean that it is unnecessary to consider whether other levels of government - both above and beyond the Community/Union level as well as levels which are ‘closer to the citizen’ - should be involved in a given policy decision. This seems particularly evident in the context of the Common Foreign and Security Policy in the second pillar, given circumstances in which EU may need to work within and alongside other international fora such as the WEU, NATO or the UN. 
3.  Subsidiarity and the Court of Justice
 It is generally accepted that concerns over excessive centralisation of decision-making and over the expanding competence of the Community at the expense of Member States and sub-national levels of government, resulting in the desire to impose some kind of formal discipline or legal restraint on its policy-making functions, formed a significant part of the motivation for introducing the subsidiarity principle into European law.  The legal formulation of subsidiarity in Article 5 (ex 3b) EC and in the Amsterdam Treaty protocol, however, is essentially directed at the legislative institutions of the Community.  The notable omission is the Court of Justice, which is treated as being beyond the scope of application of the subsidiarity principle insofar as its interpretative function is concerned. Although Article 5 (3b) EC seems inclusive, in that it does not specify which of the Community institutions is or is not subject to the subsidiarity principle, and although the Amsterdam Protocol also initially requires that "each institution" shall, in the exercise of its powers, ensure compliance with the principles of subsidiarity and proportionality, the subsequent provisions of the Protocol seem to exempt the Court of Justice, at least in its role of interpreting the scope of the Treaty, from the application of subsidiarity. The protocol goes on to state that "the principle of subsidiarity does not call into question the powers conferred on the European Community by the Treaty, as interpreted by the Court of Justice" but provides a guide as to how those powers are to be exercised at Community level.  This statement distinguishes the Court’s interpretation of the scope of Community powers under the Treaty, from their actual exercise by the institutions and states that the principle of subsidiarity does not apply to the Court's interpretation of those powers which are conferred on the Community by the Treaty.  This suggests that subsidiarity should operate as a general principle to guide the legislative institutions in their exercise of power, and not - although notably the protocol does not state this in the case of the proportionality principle - as a principle which would influence the Court in deciding whether or not a particular provision of the Treaty should be read as conferring legislative power on the institutions. Thus it is clearly supportive of the Court's ultimate interpretative authority to determine what powers the Community has been given under the Treaty.  
What the protocol and the other Agreements and guidelines before it do not seem to contemplate, however, is that the Court plays a role not only in determining the existence of the legislative powers which have been conferred by the Treaty on the political institutions, but also in interpreting the scope of Treaty provisions which, although they may be negatively worded rather than expressly power-conferring, are open to a number of interpretations capable of expanding the scope of Community law and correspondingly restricting the scope of action of Member States.  The act of interpretation itself amounts to the exercise of a certain kind of power by the Court, yet it is unclear from any of the various Treaty provisions dealing with subsidiarity whether or how the principle might affect this particular exercise of power.
Indeed, it is not only the role of the ECJ as an institutional actor which is in issue here, but the entire ‘negative integration’ potential of the Treaty provisions as they have been construed by the various institutions and actors, even if most importantly by the Court.  The aspect of expansion and centralisation of Community action which is not apparently taken into account by the legal formulation of the subsidiarity principle is that there is a bias towards integration inherent in some of the economic provisions of the Treaty, and this, often in the hands of the Court of Justice, this has been affirmed and supported.  The “economic constitutional” provisions of the EC Treaty not only have the potential effect of prioritising and privileging market liberalisation norms, but have been judicially construed in such a way as to make it virtually impossible to assert with confidence that there is any area of national law which falls clearly outside the competence of the Community. This - i.e. the assertion that an area of policy falls outside Community competence - is an answer often given by Commissioners responding to Parliamentary questions about what action the Community will take in spheres in which the Commission does not wish to take action, but insofar as the impact of Community economic rules, as construed by the ECJ, on domestic law is concerned, it is difficult to claim that any area of domestic policy is excluded, be it family law, abortion, sport, culture or criminal law.  Taking the following three cases as examples of this phenomenon, we can see the Court’s refusal to engage with the argument that it too, as a Community institution, may have responsibility for observing and ensuring that there are boundaries to the reach of Community law into national law.  They are cases decided at very different times - 1974, 1982 and 1996 respectively - by a differently constituted European Court, and yet the reasoning and the inexorability of the expansionist logic is remarkably similar in each.  The fact that areas of domestic policy which were thought to be (deliberately) kept free from Community influence are being undermined or altered by the strength of the economic rules as interpreted by the Court, is treated as a matter of legal logic and textual inevitability.  Instead of assessing or questioning, for example, what the proper extent of incursion by the Treaty’s economic rules into other areas of national policy might be, the ECJ has answered arguments of this kind simply by asserting that even if matters remain ostensibly within the sole competence of the Member State, it does not necessarily mean that they will be unaffected by any other Community rules.
The first of the cases in question is Casagrande, in which the Staatsanwaltschaft of the Verwaltungsgericht, the third party in the main action, argued for a more limited interpretation of Article 12 of Regulation 1612/68 on the basis that educational policy and educational grants were within the competence of member states .  The Court responded in the following terms:

11. In the Federal Republic of Germany such policy is largely within the competence of the Länder, and therefore it must be asked whether article 12 applies not only to the conditions laid down by laws emanating from the central power but also to those arising from measures taken by the authorities of a country which forms part of a federal state, or of other territorial entities . 
12  Although educational and training policy is not as such included in the spheres which the Treaty has entrusted to the community institutions, it does not follow that the exercise of powers transferred to the Community is in some way limited if it is of such a nature as to affect the measures taken in the execution of a policy such as that of education and training .

The Court in this way rejected the argument that the provision in Article 12 of the Regulation that children of migrant Member State workers should be “admitted to courses” should be limited to the actual admission of children to educational courses so as not to encroach unnecessarily on the competences of the Länder.  Instead, without actually addressing the question of the possible limits of Community competence in a sphere which potentially touches upon reserved areas of sub-national powers, the Court interpreted it expansively to include any ‘general measures intended to facilitate educational attendance’, including educational grants for secondary school in Germany, thus construing the EC provisions as extending into the realm of Member State financing of education.
	Some years later, in the case of Reina, it was argued to the Court that the legislative measures fleshing out the Treaty provisions on the free movement of workers should not be interpreted in such a way as to extend to non-national Community workers the national policy of offering interest-free loans to encourage childbirth amongst German nationals. This, it was argued, was an aspect of German demographic policy not linked in any way to employment status, but instead to political aspects of nationality, and that it did not in any way hinder the mobility of migrant workers.  The Court again responded in the following way:

14. The Landeskreditbank disputes that conclusion by maintaining that childbirth loans, such as those at issue, fall outside the scope of the concept of “social advantage” within the meaning of  Article 7(2) of Regulation 1612/68 since they are granted principally for reasons of demographic policy in order to counteract the decline in the birth rate of the German population. It is therefore a measure adopted in the area of political rights, necessarily linked to nationality, and which as a result falls outside the ambit of Article 48 et seq of the Treaty and of the rules adopted to implement those provisions.
15. It should be stated that, since the Community has no powers in the field of demographic policy as such, the Member States are permitted, in principle, to pursue the achievement of the objectives of such a policy, even by means of social measures.  This does not mean, however, that the Community exceeds the limits of its jurisdiction solely because the exercise of its jurisdiction affects measures adopted in pursuance of that policy.

Once again, the Court’s judgment treats it as sufficient, in answer to the Landeskreditsbank’s argument, to assert that an area of national decision-making does not necessarily remain untouched by Community law even if it falls primarily within the limits of Member State competence.  There was no more nuanced consideration of the relative importance or autonomy of this area of national demographic policy in relation to its possible impact on the Community’s policy of promoting the free movement of workers, nor any analysis of the claim that the loan policy was an issue of political rights linked to nationality, rather than social rights linked to mobility and residence as a Community worker.  The implication of the Court’s approach seems to be that no area of national or regional policy, however circumscribed or reserved for that level of government within national constitutional structures, can be definitively said to be beyond the reach of the Community’s economic norms. But it goes no further than this in considering whether there may be any limits, stemming in part from respect for those other levels of government and the nature of their powers, to the extent of the potential reach of these Treaty norms. 
More recently in the Bosman case, we see another example of this kind of judicial reasoning, where the Court, despite express reference being made by the German Government to the subsidiarity principle, again refused to engage with the question of the possible impact of its interpretative strategies on the competences and policy-making functions of lower levels of government: 

72. The German Government stressed, first, that in most cases a sport such as football is not an economic activity. It further submitted that sport in general has points of similarity with culture and pointed out that, under Article 128(1) of the EC Treaty, the Community must respect the national and regional diversity of the cultures of the Member States…
….
78. The argument based on points of alleged similarity between sport and culture cannot be accepted, since the question submitted by the national court does not relate to the conditions under which Community powers of limited extent, such as those based on Article 128(1), may be exercised but on the scope of the freedom of movement of workers guaranteed by Article 48, which is a fundamental freedom in the Community system.

In other words, none of the limits expressly imposed in the Treaty on the legislative competence of the Community are treated by the Court as being relevant to its interpretative choices over the breadth of application of the Treaty’s economic norms. Even if the powers of the Commission and the Council to enact policy measures in the field of culture and sport have been circumscribed by reference to the subsidiarity principle, in order to protect the decision-making powers and processes of lower levels of government, this, in the Court’s view, has nothing to do with the possible impact on policy-making by those levels of government of its own rulings on the scope of the Treaty’s economic norms. The free movement norm in Article 48 is a “fundamental freedom” to be interpreted by the Court and this is not comparable, on the Court’s reasoning, to the exercise of “Community powers of limited extent”.  There is apparently no contemplation of the possibility that the Community norms in provisions such as Article 48, and their interpretation by the Court, may themselves be subject to certain ‘subsidiarity-inspired’ limits of the kind which are openly expressed in Article  (previously 128).

IV.  Conclusion

One of the arguments of this paper is that it is important, within an increasingly interdependent global economic and political environment in which the fora and sites of authority continue to multiply and grow in complexity, to identify criteria for managing the relations between these different sites, and for assessing the appropriateness of decision-making at a given level or levels of government.  Within the EU system, these questions find expression largely through the language of subsidiarity and associated concepts such as competence and legal basis.  However, although a set of conceptual tools for addressing these issues is clearly necessary, the way in which subsidiarity has been conceived as a legal principle within the EU context is very narrow and limited in its focus. The primary legal formulation in Article 5 (formerly 3b) relies on a series of concepts such as exclusive competence which are unhelpful and circular, it addresses only the two main levels of authority within the European Community (the EC and the Member State), and it privileges efficiency over all other criteria for assessing the appropriateness of particular levels of decision-making.
The Protocol on subsidiarity and proportionality, added by the Treaty of Amsterdam to the EC Treaty, incorporates a somewhat more fluid and potentially more useful approach by ‘constitutionalising’ the guidelines which were to some extent already being followed by the Community, blurring the lines between the principles of subsidiarity and proportionality, focusing less on the idea of exclusivity and more on the possibilities for sharing competence across different levels of authority through the use of specific types of legal instrument, and emphasising the importance of reasoning and justification of decision-making at least at EC level. However, the range of questions arising in relation to the role of different levels of government and of the various institutions, actors and tiers of political authority go well beyond what is expressed in the various legal formulations of subsidiarity in the EU treaties. Some significant and relatively concrete issues, such as the role of the Court of Justice in managing and altering the relationship between different levels of authority, and many other important questions concerning the relationship with lower and higher levels of government - the subnational, transnational and international levels - are not addressed at all.  Nevertheless, it is undoubtedly the case that the relevance and salience of the issues expressed through the language of subsidiarity in the EU context (as indeed is evident from the fact that the political scope of that concept in European law and policy-making is more extensive than its legal parameters would suggest) is increasing rather than declining in recent years.  Far from being a transitory notion whose usefulness to seal a political compromise was exhausted once the Maastricht bargain had gelled, the concept of subsidiarity continues to express, and to raise, fundamental questions about the appropriate locus of political and legal authority within a complex and multiple-layered polity, which is itself situated within an increasingly interconnected international ‘order’.