Efficient taxation of multi-national enterprises in the European Union. Bruges European Economic Policy (BEEP) Briefing 5/2003

Current arrangements for multi-national company taxation in EU are plagued by severe conceptual and administrative problems, leading to high compliance costs, considerable uncertainty and ample room for abuse. Integration is amplifying these difficulties. There are two possible approaches in designing an efficient trans-border corporate tax system for the European Union. The first is to consolidate the EU-wide operations of MNEs, using an agreed common base as the reference variable, and then to apportion this total tax base using some presumptive indicators of activity in each tax jurisdiction – hence, implicitly, of the likely benefits stemming from each location. The apportionment formula should respect requisites of neutrality between productive factors and forms of corporate financing. A radically different approach is also available that offers considerable advantages in terms of efficiency, simplicity and decentralisation, including full administrative autonomy of national tax authorities. It entails abandoning corporate income as the relevant tax base and taxing at a moderate rate some agreed measure of business activity such as company value added, sales or employment. These are the variables usually considered in formula apportionment, but they would apply directly without having first to go through the complications of EU-wide consolidation based on a common-base definition. Reference to a broad base, with no exemptions or deductions, would allow to set low statutory rates.

Is Withdrawal from the European Union a Manageable Option? A Review of Economic and Legal Complexities. Bruges European Economic Policy (BEEP) Briefing 28/2013

Withdrawal from the EU is no more a taboo subject. However, the process by which it can happen is unclear and potentially complex. The purpose of this paper is to show that a withdrawing Member State will not only rid itself from the constraints and obligations of EU rules, but it will also have to re-invent many policies and institutions to fill the gap left by the non-application of EU rules. The paper examines closely the case of the UK and Scotland and concludes that outright exit is not the best option for a withdrawing Member State. The best, but possibly the least feasible, option is an intermediate arrangement falling between full membership and complete separation from the EU. The exact position between the two extremes can only be determined by the exit negotiations and will be influenced by the political climate that will prevail at that time. While the final destination of an acceding country is well known [full adoption of the obligations of EU membership], the exiting country will be embarking on a trip with unknown destination and full of surprises.

Income Distributional Effects of Decoupled Payments Single Payment Scheme in the European Union. Factor Markets Working Paper No. 29, July 2012

This paper analyses the effects of the Single Payment Scheme (SPS) with and without farm structural change, and focuses on how income distributional effects and farm restructuring are impacted by the SPS under: alternative entitlement tradability, cross-compliance and CAP 'greening' requirements, different SPS implementation models, the entitlement stock, market imperfections and institutional regulations. The authors find that the SPS implication details are highly significant, since farmers’ benefits can range from 100% of the SPS value to a negative policy incidence, and farm structural change may also be hindered by the SPS.

Riding or Reaping the Whirlwind? An Account of the EU’s Engagement with Insecurity in Northern Nigeria. EU Diplomacy Paper No. 9, November 2014

The relations of the European Union (EU) with Africa are increasingly spreading beyond the domain of humanitarian and development cooperation. The continent’s growing potential is producing vast webs of interlinkages in the realms of energy and commerce, among others. At the same time, such interdependencies bring with them increased vulnerabilities to insecurity on the continent. Nigeria exemplifies such a dilemma. The country has just taken the top spot as Africa’s largest economy. Of late, however, violent Islamic extremism ravages the north of the country, threatening the stability of one of Europe’s foremost energy suppliers and a growing trade partner. Thus, this paper sets out to uncover the EU’s response to such a crisis, as well as examining the factors lying behind this response. While the study argues that the issue is potentially ‘Europeaniz-able’ from a member state perspective, deep engagement is seen to be held back by the absence of an effective entry point for securitization with this important ally, as well as the intractability of the EU’s purported multi-functional approach to the idiosyncrasies of the conflict in question, in which not only transnational terrorist groups, but also the central government are centrally implicated in deepening insecurity.

Making the most of Energy Union. CEPS Commentary, 16 December 2014

By elevating “Energy Union” to the status of a Commission mission statement, Commission President Jean-Claude Juncker succeeded in forging a new EU consensus on energy and climate change at the October European Council meeting. In a move that was made possible by linking the internal energy market and climate change agendas to security of supply, solidarity and infrastructure, the initiative notably meets the interests of Central and Eastern Europe as well as the peripheral member states. This commentary by a team of energy specialists at CEPS applauds this new development, but cautions that the European Commission will soon need to give it real meaning and substance before Energy Union can become reality. With this objective in mind, the authors outline six priorities to which Commission Vice President Maroš Šefčovič should give immediate attention.

One money with several cycles? Evaluation of European business cycles using cluster analysis. ACES Cases No. 2009.3

Optimal currency area theory suggests that business cycle comovement is a sufficient condition for monetary union, particularly if there are low levels of labour mobility between potential members of the monetary union. Previous studies of co-movement of business cycle variables (mainly authored by Artis and Zhang in the late 1990s) found that there was a core of member states in the EU that could be grouped together as having similar business cycle comovements, but these studies always used Germany as the country against which to compare. In this study, the analysis of Artis and Zhang is extended and updated but correlating against both German and euro area macroeconomic aggregates and using more recent techniques in cluster analysis, namely model-based clustering techniques.

Ideas and Policy: The European Union considers social policy futures. ACES Cases No. 2010.2

The European Union’s social policy perspectives have changed quite dramatically over the last several decades. Now EU’s social policy discourse often promises to “invest in people,” sometimes “to invest in children,” and always to pay particular attention to youth. This paper argues that the tools of historical institutionalism can lead to understanding the ideational roots of this social investment perspective so distant from the “European social model.” Coming out of social movements, and with collective identities shaped both by those movement roots and national experiences, activists have effectively focused their practices on altering the social representations of European social solidarity through their interest group interventions, their participation in policy forums, and their mobilization within civil society at the European and sub-European levels. They have been able to make common cause with several epistemic communities that themselves revamped their ideas in the face of new institutional constraints, in order to advance their interests in promoting particular directions for social policy. The paper documents that “ideas” are not a variable and discourse “sometimes important” but that the ideas carried by movements and in epistemic communities are integral to the very definition of their interests that they promote within and with institutions.

Hegemony Without Stability: The fiscal and political vulnerabilities of monetary union. ACES Cases No. 2011.2

The crisis has forced the Euro area to establish an emergency fund that supports member states experiencing a sovereign debt crisis. The difficulties of coming up with such a fund for Greece and other Euro area members stands in marked contrast to the balance of payments support that non-Euro members like Hungary received, swiftly and quietly. In order to solve this puzzle, we first establish the difference between EU interventions and IMF programs and, second, trace the evolution of crisis management with France and Germany in the lead. The lens of hegemonic stability theory suggests that the Franco-German leadership is too weak to provide stability and the extensive use of conditionality is one symptom of this weakness. Providing incentives for cooperation "after hegemony" (Keohane) is the unresolved issues troubling the monetary union. Its dominant powers must acknowledge that markets perceive monetary union to be already politically more integrated than its lack of fiscal integration suggests.

Dealing with the Fallout: West Germany's Response to the Solange Decision (1974). ACES Working Papers, 2011

The European Union's powerful legal system has proven to be the vanguard moment in the process of European integration. As early as the 1960s, the European Court of Justice established an effective and powerful supranational legal order, beyond the original wording of the Treaties of Rome through the doctrines of direct effect and supremacy. Whereas scholars have analyzed the evolution of EU case law and its implications, only very recent historical scholarship has examined how the Member States received this process in the context of a number of difficult political and economic crises for the integration process. This paper investigates how the national level dealt with these fundamental transformations in the European legal system. Specifically, it examines one of the Union's most important member states, the Federal Republic of Germany. Faced with a huge number of cases dealing with European law, German judges dealt with the supremacy of European law very cautiously, negotiating between increasingly polarized academic, public and ministerial debates on the question throughout the 1960s. By the mid 1970s, the German Constitutional Court famously limited the power of the ECJ in its Solange decision (1974). This was an expression of a broader discourse in Germany from 1968 onwards about the qualitative nature of democracy and participation in public life and was in some aspects a marker, at which the German elites felt comfortable expressing the value of their national constitutional system on the European stage. This paper examines the political, media and academic build up and response to the Constitutional Court's decision in the 1970s, arguing that the national "reception" is central to understanding the dynamics and evolution of European Union legal history.

A Strong Europe in a Globalized World: From the Hungarian to the Polish presidency of the Council of the European Union. ACES Working Papers, 2011

On June 17, 2011, the Center for Transatlantic Relations – together with the Center for European Policy Analysis, the Polish Institute of International Affairs in Warsaw, and the Embassies of Hungary and Poland – hosted authors writing on the theme “A Strong Europe in a Globalized World,” and who offered in-depth, substantive reflections about how the United States and Europe can work together more closely in meeting global challenges. Drawing on the agendas of the outgoing and incoming EU Presidencies of the Council of the European Union – Hungary and Poland respectively – authors focused on the importance of a strong US-EU partnership in the face of mounting global challenges, from the current financial and economic crisis through the insecurities of energy markets and the promise of the Arab Spring. Authors explored in depth four key areas of shared interests: A Global Perspective (Transatlantic Partnership in a Globalized World); Achievements and Deliverables of Eastern Partnership; Euro-Atlantic Perspectives for the Balkans; and Common Challenges of Energy Security. Senior Hungarian and Polish government officials, subject matter experts, private sector actors, and think tank scholars participated.

Ukraine and the European Union: Time for a Re-Think. ACES Working Papers, 2011

There are two reasons for the virtual nature of the West’s dialogue with Ukraine. The first is institutional as the EU has until now only been willing to use ‘carrots’ and ‘sticks’ in ‘enlargement-heavy’ (i.e. full membership) whereas it has only used ‘carrots,’ but never ‘sticks’, in ‘enlargement-light’ (i.e. the DCFTA). European Council Foreign Relations Senior Fellows Nicu Popescu and Andrew Wilson argue that the EU should be more willing to use both carrots and sticks; that is integrating its soft and hard power. The second is a disconnection between the West and Kyiv over definitions of democracy. The Ukrainian authorities have until now wanted to have their cake and eat it, too; rolling back democracy in Kyiv while claiming to sign up to ‘European values’ in Brussels.

Explaining and Comparing - Improving United States and European Union-Africa Economic Relations: Policy Memo. ACES Working Papers, 2012

As evidenced by the disparities seen in the world, development does not occur uniformly around the world. Global superpowers like the United States and the European Union collectively dominate other parts of the world simply because of their ability to develop at a faster rate. With the rise of globalization and the increasing connectivity of the world economy, the world has reached a time where it is imperative that those nations and unions holding power to commit to elevating their fellow nations through supportive policy ties. The United States and the European Union, as leading global nations, have an important role in developing the economies of other countries; by taking various policy measures, the US and EU can create stronger economic ties to Africa and create a advantageous relationship for all the regions involved.

A Comparative Analysis of Regulations on Involuntary Loss of Nationality in the European Union. CEPS Liberty and Security in Europe, 75/December 2014

This study examines the workings of the Common European Asylum System (CEAS), in order to assess the need and potential for new approaches to ensure access to protection for people seeking it in the EU, including joint processing and distribution of asylum seekers. Rather than advocating the addition of further complexity and coercion to the CEAS, the study proposes a focus on front-line reception and streamlined refugee status determination, in order to mitigate the asylum challenges facing Member States, and vindicate the rights of asylum seekers and refugees according to the EU acquis and international legal standards. Joint processing could contribute to front-line reception and processing capacity, but is no substitute for proper investment in national systems. The Dublin system as currently configured leads inexorably to increasing coercion and detention, and must thus be reconfigured to remove coercion as a principle and ensure consistency with human rights and other fundamental values of the EU.

The European Union Multiannual Financial Framework 2014-2020: How to do more for less? IES Policy Brief Issue 2013/05 • May 2013

The European Council meeting on 7 and 8 February 2013 attracted an unusual level of attention from media and citizens. For a couple of days, Europe played a more important role in national politics and news. Sensation-frenzied media and excited politicians spouted notions of ‘a battle’, ‘winners’, ‘losers’ or ‘striking deals’, as if Europe had gone back to the time when its military powers still conflicted. After more than 24 hours of intense negotiations, the respective Member States leaders left Brussels with ‘good news’ for their citizens. However, those with more Euro-federalist feelings were left with a sense of non-accomplishment and missed opportunities, not only because the EU budget for the first time in history was set for a net decrease, but also because the European Council’s conclusions did not contain any ground-breaking changes to this system. Nevertheless, the European Parliament (EP) immediately reminded Europe about its role and outlined its conditions for further negotiations. Thus, the supporters of a modern and stronger EU budget still see a chance in the consent procedure and hope to shift the focus of the debate from the juste retour spirit to the consideration of the European common good. Is there still a chance for such a shift? What issues are at stake?

The ICC and its Deteriorating Relationship with Africa in Light of the Kenya Cases: What Should the EU Position be? IES Policy Brief Issue 2013/09 • November 2013

Summary. The African Union (AU), a union consisting of 54 African States, held an Extraordinary Summit on 11-12 October 2013, to discuss its relationship with the International Criminal Court (ICC or the Court). The meeting took place just weeks before the trial of Kenya’s President Uhuru Kenyatta is scheduled to begin, and was clearly intended to voice discontent and put on hold the ongoing ICC proceedings against Kenyatta as well as his deputy, Vice-President William Ruto. Before the Summit, there were even widespread rumors that the Assembly of the AU would call for a mass withdrawal of African States Parties from the ICC Statute. Eventually, the Assembly did not go that far and took two important, but less controversial decisions. It called for the granting of immunities to Heads of States from prosecutions by international criminal tribunals and requested a deferral of the ICC cases against Kenyatta and Ruto through a resolution adopted by the UN Security Council (UNSC). After providing a background to the Kenya cases, this policy brief aims to evaluate what the position of the EU and its Member States as outspoken supporters of the ICC and the fight against impunity should be, especially given the fact that France and the UK, as permanent UNSC members, could block a UNSC deferral at any time.