SOMMARIO:

I. Introduction - II. The legal relationship between the EU and Ukraine before the signature of the Association Agreement - III. The structure and content of the Association Agreement with Ukraine: the Deep and Comprehensive Free Trade Area - IV. The approximation of Ukraine's law to EU law - V. The political dialogue and cooperation in the area of Justice, Freedom and Security - VI. The Association Agreement with Ukraine in the light of the association agreements concluded by the EU - VII. The Association Agreement in the context of the European Neighbourhood Policy - VIII. Similarities between the acts and procedures of the European Neighbourhood Policy, the Common Foreign and Security Policy and admission to the EU - IX. The role of Member States in the admission procedure - X. Some concluding remarks - NOTE

I. Introduction

 The legal debate on the events that have been taking place in Ukraine in the last few months has focused on issues related to international law, but the signature of the Association Agreement (hereafter AA or Agreement) [1] between the EU, its Member States and Ukraine, which took place on 27 June 2014, opens up new analysis perspectives focusing on the relationship between the EU and Ukraine and on the possible admission of the latter to the former. It is necessary to immediately clarify that the paper does not aim at developing a political analysis of the relationship between Ukraine and the EU and predicting whether or not Ukraine will join the club. The following assessment of admission to the EU will show that it depends on the political willingness of the Member States. Furthermore, in the case of Ukraine any future decision on admission is strictly connected to several factors which are related to each other: 1) the way in which the crisis will be solved, something which is almost impossible to foresee since the political scenario has been changing very fast since its beginning; 2) the EU political decisions on the relationship with Russia; 3) the EU’s ability to find alternatives to the Russian supply of gas and other resources; 4) the general equilibrium of the international political exchequer. It is the intention of this author to develop a legal assessment of the content of the AA to demonstrate that, whatever the outcome of the crisis, the Agreement is the unavoidable step for Ukraine’s possible membership of the EU because its provisions lay down the material conditions which are necessary for being admitted to the EU. The signatories have conceived the AA as a preliminary and necessary passage in the road towards the EU so that its enforcement is part of the admission procedure. Therefore, any decision of the Member States on Ukraine admission presupposes that the Agreement is enforced and implemented and Ukraine meets the conditions the AA imposes on it. In the briefly-outlined legal perspective of analysis the paper will focus first on the content of the Agreement, whose main features can be identified in its wide extent, in the minuteness of the regulation of the Deep and Comprehensive Free Trade Area (hereafter DCFTA), in the aim of integrating Ukraine in the internal market, in the crucial role of economy in the association, and in the relevance of the approximation of Ukraine’s national law to the [continua ..]

II. The legal relationship between the EU and Ukraine before the signature of the Association Agreement

The Agreement is the last instrument of a series of legal acts and agree­ments which have been shaping the economic and political relations between the EU and Ukraine since the collapse of the USSR. Thus, a better understanding of its content requires a brief appraisal of the most important of these instruments (at least, the key ones among them). The first agreement the EU and Ukraine signed is the Partnership and Cooperation Agreement (hereafter PCA) [5] which entered into force in 1998 and lays down the legal framework of these relations. Art 1 of the PCA sets these objectives of the partnership: 1) the development of a close political relationship; 2) the promotion of trade and investment and harmonious economic relations; 3) providing the basis for social, financial, civil, scientific, technological and cultural cooperation; 4) support for consolidating Ukrainian democracy and transition to a market economy. The PCA is not a free trade agreement, but offers most favoured nation treatment or national treatment, as well as technical assistance to the partner [6]. The agreement envisages the abolition of quantitative restrictions and establishes safeguards and anti-dumping clauses. It also envisages future economic cooperation in several sectors. Despite the limited economic aims that the PCA pursues, its rules on approximation of laws are quite well developed [7]. The second important act is the Common Strategy on Ukraine, which the European Council adopted on 11 December 1999 [8]. While the PCA laid down the legal basis of the relationship, the Common Strategy defined the principles inspiring cooperation and the strategy towards the partner to put into place to enhance this relationship. The Common Strategy identified three main objectives in the development of the relationship: 1) support for the democratic and economic transition process in Ukraine; 2) ensuring stability and security and meeting common challenges on the European continent; 3) support for strengt­hened cooperation between the parties in the context of EU enlargement [9]. Each of the aims expressed is further articulated through the setting up of the guidelines the EU and Ukraine had to follow and the widening of future fields of cooperation. In the perspective of this paper it is worth remembering that the Common Strategy is the first legal act of the EU referring to Ukraine’s aspirations to membership in the following terms: “the [continua ..]

III. The structure and content of the Association Agreement with Ukraine: the Deep and Comprehensive Free Trade Area

 This paper will not scrutinize all of the provisions of the agreement, but sketch out its main features in order to highlight the way in which it contributes to enhancement of the relationship and the political perspective it outlines. The signature of a new agreement in order to set up a free trade area was already envisaged in art. 4 of the PCA, which connected it with Ukraine’s advancement in market-oriented economic reforms. In the development of the policy towards Ukraine through conditionality, the negotiations were subject to the achievement of the goals contemplated in the 2005 Action Plan on Ukraine which the Cooperation Council adopted, while the future agreement was intended to pursue the objective of upgrading the relationship between the parties [18]. The AA between the EU and Ukraine presents the same structure and almost the same content as the Association Agreements that were signed on the same day with Georgia and Moldova [19], apart from some differences which are related to the peculiar situation of each country. The AA is articulated in seven Titles covering different fields of cooperation between the signatories and based on a set of common values enshrined in Title I, which is devoted to general principles and provides the essential element clause in art. 2. As a consequence of the wide range of aims of art. 1, the AA intends to develop the political dialogue between the parties in all areas of mutual interest in order to promote gradual convergence on foreign and security policy (Title II), to improve cooperation in the area of Justice, Freedom and Security (Title III) and to enhance economic integration through the DCFTA (Titles IV and V). Moreover, the AA pursues the aim of developing a new climate conducive to economic relations between the parties and enhancing energy cooperation (Title VI). The institutional framework is envisaged in the last Title, which also contains general and final provisions. The AA is complemented by three Protocols and forty-three Annexes which set out the EU legislation that Ukraine has to take over within established deadlines. The relationship is based on principles common to the signatories: democracy, respect for human rights and fundamental freedoms and the rule of law, respect for the principle of sovereignty and territorial integrity, inviolability of borders and independence and countering the proliferation of weapons of mass destruction (art. 2). All of these [continua ..]

IV. The approximation of Ukraine's law to EU law

Ukraine’s approximation to EU law is the keystone of the system of economic integration the AA intends to set up and represents one of its main features. In fact, Ukraine takes over the obligation to approximate its internal law to the existing EU acquis and to future reforms which could be introduced in EU laws and regulations [23]. The approximation is gradual as the AA sets different deadlines within which Ukraine has to reform its internal law. The approximation is also progressive in order to take into account the changes which will be introduced in the EU legal system. The AA therefore widens the obligation to reform national law to make it consistent with EU law that was provided in the PCA to ensure that the establishment of the DCFTA will be based on the EU acquis. In line with the already established system of periodical review entrusted to the European Commission, the AA provides for the assessment of approximation to EU law in the context of a broader monitoring system that is introduced to verify respect for the commitments and the progress in implementing the agreement and achieving the targets. In this perspective it is to be underlined that the AA devotes specific rules on approximation and monitoring in the General and Final Provisions contained in Chapter 2 of Title VII. Art. 474 envisages that Ukraine will carry out gradual approximation of its legislation to EU law on the basis of the commitments taken, while art. 475 provides for continuous appraisal of the progress Ukraine has achieved in the implementation and enforcement of the Agreement. Approximation to EU legislation also marks the economic and sector cooperation which is regulated in Title V of the AA and is part of the wider process of Ukraine’s integration in the EU economy. In the fields covered by Title V the Agreement establishes Ukraine’s commitment to align with EU law [24]. The envisaged cooperation is quite extensive as it covers several fields: energy cooperation, including nuclear issues (Chapter 1); macro-economic cooperation (Chapter 2); management of public finances (Chapter 3); taxation (Chapter 4); statistics (Chapter 5); the environment (Chapter 6); transport (Chapter 7); space (Chapter 8); cooperation in science and technology (Chapter 9); industrial and enterprise policy (Chapter 10); mining and metals (Chapter 11); financial services (Chapter 12); company law, corporate governance, accounting and auditing (Chapter 13); [continua ..]

V. The political dialogue and cooperation in the area of Justice, Freedom and Security

 Although centred upon the economy, the AA pursues the objective of strengthening the Eastern Partnership of the ENP in which Ukraine takes part in all the fields in which cooperation has been put in place in the framework of the PCA, including political dialogue and cooperation in the area of Justice, Freedom and Security. The part of the AA containing the political provisions was signed on 21st March 2014 in the aftermath of the Maidan Square upheaval and the internal crisis stemming from President Yanukovich leaving the country in February 2004. In signing the political provisions of the Agreement the Parties postponed the signature of the whole text to June 2004 [25]. The decision to sign only this part of the AA also posed a legal question involving the nature of the agreement resulting from those provisions. In the opinion of this author the provisions on political cooperation did not embody in themselves an association agreement because they do not have the features marking the kind of agreement the Court of Justice identified in the Demirel case stating that association agreements create “special, privileged links with a non-member country which must, at least to a certain extent, take part in the Community system” [26]. In fact the provisions on political cooperation refer to just one of the wide range of objectives the AA is intended to achieve while Ukraine’s participation in the EU system is ensured through cooperation in all of the fields covered by the association and the obligation of approximation to EU law. As regards political dialogue, the AA is conceived to foster the already established cooperation between the signatories and to deepen it in two different but connected ways: expanding the areas of common action and improving the quality of cooperation between the parties. In the last Report on Ukraine’s Progress the European Commission noted that Ukraine continued to cooperate with the EU on some regional and international issues and its alignment with CFSP declarations rose from 32% in 2012 to 47% in 2013, but considered that this rise did not entail a qualitative change in building more coherence in foreign policy between Ukraine and the EU [27]. This is the background on which the rules set in Title II of the AA, dealing with political dialogue and reform, political association, cooperation and convergence in the field of foreign and security policy, are to operate in [continua ..]

VI. The Association Agreement with Ukraine in the light of the association agreements concluded by the EU

Association agreements are one of the most important international agreements the EU has been availing itself of in the development of its external relations [31]. The content of these agreements has been broadened over time as a consequence of the expansion of EU competences, so that alongside economic cooperation, which was the original rationale of such agreements, there has been political cooperation and cooperation in matters such as migration, justice, freedom, security, regional cooperation, reinforcement of democratic institutions, protection of human rights and fundamental freedoms. The AA concluded with Ukraine does not only belong to this new generation of association agreements, but, apart from the association agreement with Turkey, represents the most advanced association agreement because of the size and intensity of the cooperation which is envisaged in the treaty and the close ties it is to set up between the signatories, thus creating a special and privileged relationship. The features marking the AA – gradual rapprochement, Ukraine’s association with EU policies and participation in programmes and agencies, convergence of the policies of the signatories on foreign and security matters, integration of Ukraine in the EU internal market, cooperation in broad areas of economic activities, and the commitment to approximating domestic legislation – make it different from the existing association agreements, which pursue the objectives of political cooperation and the establishment of a free trade area. In fact, neither the association agreements concluded with some of the countries taking part in the ENP [32], nor those signed outside the ENP [33] aim at integration of partners in the EU internal market, participation in EU programmes and agencies or convergence of foreign policies. The association agreements the EU has signed with the Mediterranean partners of the ENP – the so-called Euro-Mediterranean Agreements [34] – consider political dialogue as an instrument to use to develop mutual understanding, solidarity, stability and regional security. In the economic field the association agreements in question pursue the objective of establishing a free trade area by 2010 through partial and progressive liberalisation of trade in goods or of trade in services, but the content of the provisions consists of the reaffirmation of the obligations stemming from the WTO agreements. In [continua ..]

VII. The Association Agreement in the context of the European Neighbourhood Policy

 From the foregoing it is clear that the privileged links the AA envisages grants Ukraine a special position among the other countries taking part in the ENP. But, apart from the comparison with the legal status of the ENP partners, to better evaluate the content of the AA and its added value, as well as the prospects it might open up in the relationship between the EU and Ukraine, it is necessary to consider the Agreement in the context of the ENP and with reference to the aims of this policy. The EU’s difficulties in defining the final aim of its policy towards Ukraine have become more and more evident as a consequence of the decision to launch the ENP in 2003 [39] and to insert Ukraine in this policy. The ENP was conceived as a policy alternative to admission and its main aim is to ensure the security of the EU [40]. The features of the policy were summarized by the then President of the Commission, Prodi, in a speech delivered in December 2002: “we are projecting stability beyond the borders of the current candidate countries (…) I am going to talk about the need for a new political perspective on relations with our southern and western neighbours. (…) We have to be prepared to offer more than partnership and less than membership” [41]. The security objective entails that the ENP is part of EU foreign policy, representing in the words of the Council “a core foreign policy” [42] and “one of the core priorities of the Union’s external action” [43]. Moreover, the ENP is the regional implementation of the European Security Strategy that the European Council adopted at the meeting held on 12 December 2003 [44]. The root origins of the ENP can be traced back to the collapse of the Soviet Union and the related need for political solutions facing the challenges stemming from the new political scenario. But what drove the EU to set up a comprehensive policy embracing the neighbouring countries was the prospect of admission of the Countries of Central and Eastern Europe. The connection between the development of a new policy and enlargement was clarified in the Conclusions the European Council adopted at the Copenhagen meeting in December 2002: “enlargement (…) presents an opportunity to take forward relations with neighbouring countries based on shared political and economic values. The Union remains determined to avoid new dividing [continua ..]

VIII. Similarities between the acts and procedures of the European Neighbourhood Policy, the Common Foreign and Security Policy and admission to the EU

 Not only the AA, the ENP and the procedure of admission are connected to each other, but there are several similarities among them [60]. The identity of the instruments the EU uses in the development of the ENP, the CFSP and admission is the first similarity between them. This identity entails that the acts in question are fungible as they are suitable for being used within contexts that are different in nature and aims. As a consequence the objectives the EU pursues do not depend on the nature of the tools it makes use of or the policy in which it resorts to them, but rather on the political willingness of Member States and the decisions they take on the political perspective to offer to EU partners. In this line of reasoning it is not surprising that the EU has converted relationships that started within the CFSP into admission. Croatia’s admission to the EU, which took place in July 2013 [61], is the last of such a conversion [62]. The second similarity concerns the way in which conditionality has been conceived and put in place. In the Ukraine ENP conditionality has been developed through the Action Plan adopted in 2005 [63], as well as the Association Agendas which replaced the Action Plan in 2009 [64]. These acts set up principles, objectives and key priorities which tend to bias Ukrainian efforts to meet the conditions for improving the relationship and are subject to review within an established time on the basis of assessment by the European Commission [65]. Although no obligations arose from the acts in question, they gave the EU the opportunity to exercise its normative power [66] so that Ukraine has been spurred to adopt the political and economic reforms contemplated in the non-binding acts and to adapt national law to the EU acquis [67]. The 2005 Action Plan and the Association Agendas adopted have been functioning within the context of the Ukraine ENP in the same way as Accession Partnerships operated in the admission of Central and Eastern European Countries [68], and European Partnerships have been working in the policy of enlargement towards the Western Balkans. Furthermore, the EU has been using conditionality in the context of the Ukraine ENP in the same way as it had recourse to it within the enlargement policy. The policy towards Ukraine has been construed as a work in progress in which the strengthening of the relationship between the EU and the third country is [continua ..]

IX. The role of Member States in the admission procedure

The law on admission to the ECC and later the EU has been amended several times through treaty revision [81], but despite these reforms the centre of gravity of the system the Treaty shapes is still the discretionary power of Member States, for they enjoy the right of veto within the Council on the decision on applications for membership and are called on to ratify the Treaty establishing the conditions of admission and the adjustments to the Treaties on which the Union is founded in accordance with their national law. General De Gaulle’s veto on the admission of Great Britain [82] is the first case showing such a role of Member States. The decision on admission as well as the decision on the opening of negotiations is left to Member States’ discretionary power, so that the TEU does not provide the right to admission for non-member States though they satisfy the conditions established by the Treaty or the EU within the procedure. This political discretion also concerns the appreciation of candidates’ fulfilment of the conditions required for membership. The inconsistent evaluation of the performances of the Eastern and Central European candidates [83] is an example of the political discretion ruling admission and its procedure. Although the Treaty confers upon Member States such a discretionary power, the development of the practice has shown interesting trends which can be appreciated in the light of the relationship between the development of the supranational nature of the process of integration and the safeguard of national competences. The TEU does not discipline the process of admission as a whole which, in turn, has become more and more complicated [84]. In fact, Member States and the EU institutions have developed a practice filling the lacunae of the Treaty law [85]. Today admission to the EU is a procedure articulated in phases which in fact does not start after the application for membership, but begins before application, with the so called pre-accession that is developed through several and different legal instruments, such as acts, activities and agreements, ranging therefore from soft law to binding rules [86]. The pre-accession phase is intended to create in perspective the political conditions for admission (democracy, rule of law, respect for human rights and minority rights) and to start up market economy reform and approximation to the EU acquis. The decision to begin the [continua ..]

X. Some concluding remarks

Appraisal of the AA gives us the opportunity to reach some more general conclusions. The first of these conclusions is that association agreements are multipurpose agreements. Association agreements set up advanced cooperation and can either limit their function to the establishment of privileged relationship or pursue the further objective of preparing the EU partners for admission. In this second case association agreements are also one of the phases of admission procedure. As regards Ukraine, the AA expands the relationship between the parties to the maximum level of association within the ENP, providing the country with a privileged status among the states that are involved in this policy, and was conceived by the parties as a necessary step towards admission because its enforcement and implementation lead the associated country to meet the conditions which are imposed on applicant states to become members of the EU. The second conclusion is that the economy and the rules on the structure of the market play a central role in the process of integration within the EU. The goal of integrating Ukraine in the EU internal market and the obligation the AA imposes on Ukraine to shape its domestic market on the basis of the EU rules concerning the structure of the internal market make it clear that the economy is the engine of EU external relations, and, in the perspective of possible admission, the cornerstone of the process of integration, which sticks to its original matrix. Such an approach has also been enshrined in the principles of the revised negotiating framework aiming at preventing future admissions from endangering the level of economic development already achieved in the Common Market. The third conclusion concerns the role of Member States in the process of European integration. Although Ukraine’s membership cannot disregard the enforcement and implementation of the AA, its admission to the EU depends on Member States’ political willingness to proceed accordingly. In this line of reasoning it is interesting to observe that the Heads of State or Government in a statement on Ukraine following the extraordinary meeting of the European Council on 6 march 2014 [92] and the 20-21 March 2014 meeting of the European Council in its conclusions on the Ukrainian crisis [93] carefully avoided any reference to Ukraine’s future admission. In more general terms, the recent practice of admission, as well as the recent [continua ..]

NOTE