Module 1
The Union as a legal order: how it came about, the treaties, the sources of EU law and the limits of its powers
The European Union is not a state, and it is not an ordinary international organisation. It is a union of states that has created its own legal order, with its own institutions, its own lawmaking and a court whose rulings bind the states that founded it. That is why a lawyer anywhere in Europe, and many far outside it, meets Union law in daily work: in a contract with a supplier in another country, in a data request, in an employment dispute or in a challenge to a national statute. This module draws the map. It tells in outline how the Union came about, names the treaties and the other sources of its law and how they rank, explains the rule that the Union has only the powers its members gave it, and shows why the Court of Justice called the result a new legal order.
By the end of this module you can
- Tell how the Union came about and name its founding treaties.
- List the sources of EU law and say how they rank.
- Distinguish a regulation, a directive and a decision.
- Apply conferral, subsidiarity and proportionality to a proposed measure.
- Explain why the Union is called an autonomous legal order.
Part 1. The lecture
How the Union came about, in outline
After the Second World War, a small group of European states chose to tie the industries that make war, coal and steel, under a common authority, so that war between them would become, in the words of the founders, not merely unthinkable but materially impossible. The Union grew from that step, and its law cannot be understood without seeing that it was built in stages, each one adding powers and members.
| Step | What it did | Why it matters in law |
|---|---|---|
| Coal and Steel Community (Treaty of Paris, 1951) | Placed coal and steel production of six states under a common High Authority | The first body with powers over its members that members could not simply ignore |
| Economic Community and Atomic Energy Community (Treaties of Rome, 1957) | Created a common market, a customs union and common policies | The Treaty of Rome is the ancestor of today’s treaty on the functioning of the Union |
| Single European Act (1986) | Set the aim of completing the single market and widened majority voting | Turned the market into a project with a deadline and a method |
| Maastricht Treaty (1992) | Created the European Union, European citizenship and the path to the euro | Added areas beyond the market, such as foreign policy and justice, and gave the name |
| Amsterdam (1997) and Nice (2001) | Reformed the institutions and moved more areas to majority voting | Prepared the Union for enlargement |
| Lisbon Treaty (2009) | Produced the two treaties in force today, gave the Union a single legal personality and made the Charter of Fundamental Rights legally binding | The text every Union lawyer now works from |
The Union has grown by the accession of new member states, which must accept the whole body of Union law as it stands. A member state may also leave: the Treaty on European Union has a withdrawal procedure, which the United Kingdom used before it left in 2020. That shows that the Union rests on the consent of its members, and that membership is a legal status with rights and duties.
Keep in mind
The Union is not the Council of Europe. The Council of Europe is a different organisation with its own members, and it is the home of the European Convention on Human Rights and the European Court of Human Rights in Strasbourg. The Union’s own court is the Court of Justice of the European Union in Luxembourg. Mixing them up is the most common beginner’s error.
The sources of EU law, and how they rank
A lawyer’s first job in any problem is to find the rule and decide how much weight it has. In Union law the sources fall into layers. The higher layer controls the lower: a measure that conflicts with a treaty can be struck down.
| Layer | What it contains | Notes |
|---|---|---|
| Primary law | The Treaty on European Union (TEU), the Treaty on the Functioning of the European Union (TFEU), the Charter of Fundamental Rights, the protocols and the treaties of accession | The constitutional foundation. The treaties and the Charter have the same legal value |
| General principles of law | Unwritten principles the Court draws from the treaties and the traditions of the member states, such as proportionality, legal certainty and fundamental rights | Part of the law the Court applies and can measure acts against |
| International agreements | Agreements the Union has concluded with other states and organisations | Binding on the Union and on the member states, and below the treaties |
| Secondary law | Acts adopted by the institutions under the treaties: regulations, directives, decisions, recommendations and opinions (Article 288 TFEU) | Must stay within the treaties and can be annulled if it does not |
| Case law of the Court of Justice | The Court’s rulings on what the treaties and acts mean | Not formally binding like a statute outside the case, but followed, and it has shaped the whole system |
Secondary law deserves a closer look, because the three binding instruments behave very differently, and the difference is the most tested point in the whole subject.
| Instrument | Binding on | How it works | Example (invented) |
|---|---|---|---|
| Regulation | Everyone it covers, in every member state | General and binding in all its parts and directly applicable: it takes effect without any national law | A rule on how companies must label a product, the same everywhere |
| Directive | Each member state it is addressed to, as to the result | Binding as to the result to be achieved, but each state chooses the form and means: it must pass national law to carry it out (transposition) by a deadline | A rule that sets a minimum period of paid leave, which each state writes into its own law |
| Decision | Those to whom it is addressed, if it names them | Binding in its entirety. It may be addressed to a state or to a company, or may be general | A decision that approves a company merger on conditions |
| Recommendation and opinion | No one | Not binding. They state a view and may guide courts and national law | A recommendation on how to handle a type of dispute |
Why the rank matters
If a directive conflicts with a treaty article, the directive can be annulled. If a national law conflicts with a regulation, the regulation prevails. The first question in an EU problem is therefore always: what is the source, and where does it sit?
The limits of the Union’s powers
The Union may act only where the treaties give it power. This is the principle of conferral in Article 5 of the TEU. Powers not conferred remain with the member states. Where the Union does have power, two further principles limit how it may use it.
| Principle | What it requires | Where it applies |
|---|---|---|
| Conferral | The Union acts only within the limits of the powers its states gave it, and only to attain the objectives set in the treaties | Always: a measure with no legal basis in the treaties is invalid |
| Subsidiarity | In areas that are not exclusively the Union’s, it acts only if the aims cannot be achieved well enough by the member states, and can be better achieved at Union level | Shared areas; national parliaments are given a role in checking it |
| Proportionality | What the Union does must not go beyond what is needed to achieve the objectives of the treaties | Every Union action |
The treaties sort competences into three kinds. In exclusive areas only the Union may legislate, such as the customs union and the common commercial policy, and the member states may act only if the Union empowers them. In shared areas, such as the internal market, consumer protection, the environment, transport and the area of freedom, security and justice, both may act, but the states act only so far as the Union has not. In supporting areas, such as health, culture, education and tourism, the Union may only support or coordinate what the states do, and may not harmonise their laws.
Worked example (invented)
A proposal would set one national school curriculum for all member states.
Conferral: is there a treaty basis? Education is a supporting competence, where the Union may support but not harmonise national laws, so the proposal very likely has no basis.
The question never reaches subsidiarity. A lawyer who starts with the policy and not the legal basis misses the point.
A new legal order, and a system of its own
In 1963, in *Van Gend en Loos*, the Court of Justice said that the Community constituted ‘a new legal order of international law’ for whose benefit the states had limited their sovereign rights, and whose subjects were not only the states but also their nationals. In 1964, in *Costa v ENEL*, it said that the treaty had created ‘its own legal system’ which became part of the laws of the member states and which their courts are bound to apply. These two statements are the foundation of everything that follows: Union law is not just a treaty between governments, but law that individuals can invoke in their own courts.
- It has its own institutions and its own court, which has the last word on what Union law means.
- It has many languages. Each official language version of an act is equally authentic, and the Court compares versions when they differ.
- It reasons from purpose. The Court reads provisions in light of their aims and the whole system, so the effectiveness of the law matters as much as its words.
- It draws on several traditions. Its structure and style owe much to the civil-law systems of its founding members, but it also takes ideas, such as proportionality and fundamental rights, from both civil-law and common-law traditions.
A student from a common-law country should expect an unfamiliar style: short treaties, long preambles, and an interpretative method that looks more to the aim of a rule than to the exact words. A student from a civil-law country should expect the opposite surprise: a court whose case law, though not formally binding, is followed in practice and builds the system.
Part 2. Lab: Which Source of Law?
Sort each item by the source of law it belongs to.
Situation 1 of 6
Article 5 of the Treaty on European Union on conferral and subsidiarity.
Where does this belong?
Part 3. Lab: First Question
Choose the best first question in each situation.
Situation 1 of 3
A client says, ‘The Union has just passed a rule that cuts into our national school system. Can it do that?’
What is the best first question?
Part 4. Lab: Spot the Mistake
Click the statements that misstate how the Union’s legal order works.
A trainee’s notes
Click every sentence that causes a problem, then press Check. There may be 2 problems, and some sentences are fine.
Part 5. Check your understanding
Ten questions drawn from a larger pool. Sign in to have your score saved towards your certificate.
You have finished the free module
Here is what you can do now, and where the course goes next
Module 1 gave you
- Tell how the Union came about and name its founding treaties.
- List the sources of EU law and say how they rank.
- Distinguish a regulation, a directive and a decision.
- Apply conferral, subsidiarity and proportionality to a proposed measure.
- Explain why the Union is called an autonomous legal order.
Next, 6 more modules and a capstone
- Module 2: The institutions and how Union law is made: Parliament, Council, Commission, the Court, the legislative procedure and the legal basisYou will learn to say what each institution does and tell similar names apart.
- Module 3: EU law and national law: direct effect, consistent interpretation, state liability and the primacy of Union lawYou will learn to apply the conditions for direct effect.
- Module 4: The Court of Justice and the remedies: preliminary references, infringement, annulment, failure to act and damagesYou will learn to describe the Court of Justice and the General Court.
- Module 5: The internal market: free movement of goods, persons, services and capital, and the rules on competition and state aidYou will learn to name the four freedoms and the customs union.
- Module 6: Fundamental rights, values and citizenship: the Charter, the general principles, the limits on rights, the rule of law and the rights of citizens
- Module 7: Private law, procedure and data in the Union: consumers, cross-border disputes, judicial cooperation and data protection
- Capstone: Capstone: Anna Lindqvist sells across the Union
Each module has its own practice labs and a graded quiz, and a Certificate of Completion follows when you pass them all. The whole course is $15 once, or included in a Courses & AI Lab Pass.
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General education on European Union law, using invented people and businesses and abstract member states. It states the Treaty framework and landmark decisions in simplified form, and it is not legal advice. Rules change and national implementation differs. Consult a qualified lawyer in the place that matters.
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