Page - 70 - in Austrian Law Journal, Volume 1/2015

ALJ 1/2015 Alexander Somek 70 of the Union;18 rather, the new institutions and strategies of crisis management in their operation threaten to unsettle the institutional balance between the Union and the Member States.19 Such an indirect subversion of the allocation of powers, which effectively absorbs powers on the part of the Member States, can be observed for both areas of reform,20 i.e., the revised Stability and Growth Pact, on the one hand, and the working of various “bailout” arrangements, on the other. First, a permanent and systematic interference with national competence can be observed for multilateral surveillance, in particular for the European Semester.21 Within its scope of applica- tion, this is particularly obvious for the alert mechanism concerning macroeconomic imbalances22 and the “enhanced surveillance” of Member States, in particular if these receive financial assis- tance from the IMF or European institutions.23 Within the context of the macroeconomic imbal- ance procedure, the Commission is empowered to use a “scoreboard” of macroeconomic indica- tors24 in order to assess a Member State’s situation and to initiate, possibly, an in-depth review.25 The use of these indicators feeds into recommendations that the Member States will receive about where they have to save or where they had better improve. In the event that the Commis- sion finds that the Member State might be confronted with an “excessive” economic imbalance the Member State is expected to come up with a corrective action plan. This plan is subject to censure and approval by the Council.26 The review by the Commission and the interaction with the Council cut across all areas of public policy. They concern particularly those fields for which the Union has no jurisdiction. Therefore, it is now finally fair to say that owing to the Union’s impact on budgetary planning, there is “nucleus of sovereignty” left to the Member States.27 What is more, national parliaments are not at all major players in this process.28 While parliaments need to be informed and discuss budgetary planning in one or the other committee, any real opposition is likely to be told by the government that, in order to avert the imposition of severe sanctions, the government has to comply with the demands made by the Commission.29 It also not the case that this loss of influence, which is fairly typical by standards of European integration, is matched with the growing influence of the Euro- 18 See Andreas Fischer-Lescano & Lukas Oberndorfer, Fiskalvertrag und Unionsrecht: Unionsrechtliche Grenzen völker- rechtlicher Fiskalregulierung und Organleihe, 66 NEUE JURISTISCHE WOCHENSCHRIFT, 2013, at 9; Lukas Oberndorfer, Der Fiskalpakt: Umgehung der “europäischen Verfassung“ und Durchbrechung demokratischer Verfahren?, JURIDIKUM 168, 168-179 (2012). 19 See Mark Dawson & Floris de Witte, Constitutional Balance in the EU after the Euro-Crisis, 76 MODERN LAW REVIEW, 2013, at 817. For an in-depth analysis of this development, see Philomila Tsoukala, Euro-Zone Management and the New Social Europe, 20 COLUMBIA JOURNAL OF EUROPEAN LAW, 2013, at 32. 20 This important point is made by Tsoukala, note 19. 21 See Mark Hallerberg & Benedicta Marzinotto & Guntram B. Wolff, On the Effectiveness and Legitimacy of EU Eco- nomic Policies, 4 BRUEGELPOLICYBRIEF 1,2 (2012). With regard to the European Semester Tsoukala, note 19 at 66, ob- serves “a carry-over of loan conditionality into the overall process of policy coordination with the euro zone”. Fis- cal coordination now implicates matters such as labour, social and tax policy. 22 See Article 3 of Regulation 1176/2011. 23 See Article 2(6) Regulation 472/2013. 24 See Article 4 of Regulation 1176/2011. 25 See Article 5 leg cit. 26 See, in particular, Article 8(3) leg cit. 27 See Koen Lenaerts, Constitutionalism and the Many Faces of Federalism, 38 AMERICAN JOURNAL OF COMPARATIVE LAW, 1990, at 205, who claimed that no “nucleus of sovereignty” had been left for the Member States; in a similar vein, George A. Berman, Taking Subsidiarity Seriously, 94 COLUMBIA LAW REVIEW, 1994, at 331. 28 There is a great variety of different forms of involvement, mostly through committees. See DG FOR INTERNAL POLI- CIES, AN ASSESSMENT OF THE EUROPEAN SEMESTER at 68–76 (IP/A/ECON/ST/2010-24, 2012). 29 Of course, some political gamesmanship may be involved here too. Sometimes the recommendations by the Council do not fall on fertile ground. See Hallerberg et al, note 21 at 5.