The Community’s right of initiative has been a key feature of the EU’s legislative process since the 1950s. To break with classic intergovernmental decision-making, Monnet and his colleague founding fathers insisted on an institutional structure in which an autonomous and independent body, the High Authority/Commission, would take the lead in decision-making and come up with proposals for innovative regulation pursuing the common interest of the entire Community. The Community method for decision-making, as introduced in the 1950s, rested on a triangular balance of powers between the Commission, which was to submit and could possibly amend proposals, and the Council, which after having consulted the European Parliament, was entrusted with the task of transforming the Commission’s proposals into legislative measures.

The Treaty provisions on the Commission’s right to propose and to amend have remained largely unchanged in the course of the last six decades. However, the same does not hold true for the de facto balance of powers within the decision-making triangle. Thus, while the Commission still formally possesses a (quasi-)monopoly to initiate the legislative process, in practice its wings are curtailed by the Parliament, the Council and the European Council, which nowadays politically instruct the Commission when to come up with proposals and often even suggest the substance of these. Further, ever since the introduction, subsequent extension and the de facto development of the co-decision procedure (now ordinary legislative procedure – OLP), legislative decision-making is no longer first and foremost a process of negotiations between Commission and Council, but above all between Council and Parliament. Today, the Commission today often does not so much act as an independent, pro-active policy initiator but rather as an institution that is politically pressured to play the role of a mediator, or “honest broker”, seeking to reconcile the positions of the Council and Parliament.

In the above case Council v. Commission, the Council argued, in essence, that this mediating role is part of the institutional balance as now enshrined in the Treaties. The case concerns macro-financial assistance to third countries that are experiencing short-term balance of payments difficulties. For such assistance to produce the desired results, time is often of the essence and this, so the Commission argued, requires speedy decision-making. Therefore, in a proposal for a framework regulation for macro-financial assistance to third countries the Commission proposed that decisions for granting such aid should not be adopted through the time-consuming OLP but rather by implementing acts to be adopted by the Commission itself. Parliament and especially Council, however, did not agree and insisted on the OLP. Shortly before the two co-deciders could adopt the regulation, the Commission withdrew its proposal, thus barring legislation it had not planned and did not support.

The Council sued the Commission and asked the Court to annul the Commission’s decision to withdraw the proposal. The Council recognized that the Commission could withdraw proposals in ordinary situations in which these have been rendered obsolete or pointless by the emergence of new circumstances or of data. However, the Commission would not be entitled to do so just because or whenever it is unsatisfied with the final outcome of negotiations between Council and Parliament, as this would imply a right for the Commission to veto over legislative action on the basis of considerations of political expediency.

The Court agreed with the Council that the Commission does not possess such a veto power in the legislative process. However, it did recognize that the Commission’s role in the OLP entails more than submitting a proposal and, subsequently, promoting contact and seeking to reconcile the positions of the Parliament and the Council. Just as the Commission can decide whether or not to submit a legislative proposal and, as the case may be, to determine its subject-matter, objective and content, the Commission has the power, as long as the Council has not acted, to alter its proposal or even, if need be, withdraw it. The Commission can do so where an amendment planned by the Parliament and the Council distorts the proposal for a legislative act in a manner which prevents achievement of the objectives pursued by the proposal and which, therefore, deprives it of its raison d’être. That, so the Court concluded, was the situation in the case concerned.

Thus, the Commission cannot withdraw proposals whenever it pleases. It must have a reason for doing so. Yet, among these reasons is the possible non-achievement of aims as defined by the Commission itself. In other words, in the Court’s view, the Treaties confer upon the Commission an independent role in the OLP and, by withdrawing proposals, it possesses a tool to protect that role. Of course, it remains to be seen what the practical impact of Court’s holding will be, but the ruling does send out the important message that the Commission ought to be more than just an administrative body assisting the Parliament and the Council in their legislative activities. For such activities, the Treaties prescribe the supranational Community method and not the much more intergovernmental “Union method” that has evolved in practice and is advocated by Angela Merkel.