The Treaty establishing the European Economic Community, which had been signed on 25 March 1957, had entered into force on 1 January 1958 and had undergone several amendments, changed its name with effect from 1 November 1993 to ‘Treaty establishing the European Community’ (for which the abbreviations EC Treaty and TEC are customarily used) as a result of the Treaty on the European Union (EU Treaty). The Treaty of Amsterdam, which entered into force on 1 May 1999 (EU Treaty) refined the EC Treaty and renumbered its provisions. The TEC was amended again as a result of the Treaty of Nice and the accession treaties of 16 April 2003 and 25 April 2005 (EU Treaty). The EC Treaty has created a legal order sui generis (European Constitution). (For the objectives of this treaty and the institutional system based thereon European Community).
The Treaty of Lisbon, signed on 13 December 2007 and in force since 1 December 2009, profoundly reshaped the EC Treaty and the EU Treaty, taking into account significant elements of the failed Treaty establishing a Constitution for Europe (European Constitution). The EC Treaty changed its name to ‘Treaty on the Functioning of the European Union’ (TFEU) and the word ‘Community’ was replaced throughout by ‘Union’. Various provisions from the EC Treaty under ‘Principles’, ‘Institutions’ and ‘General and final provisions’ were replaced by provisions in the EU Treaty. However, as the EC Treaty is the legal basis of numerous legislative acts, its provisions are still of major interest.
2. Principles, procedures and forms of legislation by the EC
The EC shall act within the limits of the powers conferred upon it by the EC Treaty and of the objectives assigned to it therein (the principle of conferral). In areas that do not fall within its exclusive competence, it shall take action, in accordance with the principle of subsidiarity, only if and in so far as the objectives of the proposed action cannot sufficiently be achieved by the Member States and can therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community. Community measures must not go beyond what is necessary in order to achieve the objectives of the EC Treaty (the principle of proportionality). The Protocol on the application of the principles of subsidiarity and proportionality (principle of proportionality), which was annexed to the EC Treaty by the Treaty of Amsterdam, states that, for any proposed Community legislation, the reasons on which it is based are to be stated with a view to justifying its compliance with the principles of subsidiarity and proportionality.
Various procedures apply when the EC wishes to legislate (legislative competence of the EC/EU). In practice, the co-decision procedure, whereby the European Council (Council and the European Council) and the European Parliament have the same force, has achieved pre-eminence. Under that procedure, the Council decides by a qualified majority. Other types of procedure are the ‘assent procedure’, the significance of which is in practice confined to the economic and monetary union, and the ‘consultation procedure’, where the Parliament has only the right to be heard.
The European Commission holds the sole right of initiative for Community legislation. The Council and the Parliament have the right to require the Commission to draw up a proposal. The Council often confers on the Commission, in the acts which the Council adopts, powers for the implementation of the rules which the Council lays down. Legislative competence to enact implementing provisions has been assigned to the Commission in this way under numerous regulations. In some places the EC Treaty even grants legislative competence to the Commission. There is a special procedure for Community rule-making in the social policy sector: the social partners may request that agreements that they conclude at Community level be implemented by a Council decision on a proposal from the Commission.
The EC makes rules by way of regulations and directives. Regulations have general application. Directives are binding upon each Member State to whom they are addressed as to the result to be achieved, but leave to the national authorities the choice of form and methods. As for the manner in which directives work, the ECJ draws a distinction between whether the relationship is one between an individual and the state or one between private parties. A Member State which has not adopted the implementing measures required by a directive within the prescribed period may not plead, as against individuals, its own failure to perform the obligations which the directive entails (ECJ Case 8/81 – Becker  ECR 53).
Conversely, even a clear, precise and unconditional provision of a directive seeking to confer rights or impose obligations on individuals cannot of itself apply in proceedings exclusively between private parties. However, the principle that national law must be interpreted in conformity with Community law has to be observed. If the application of interpretive methods recognized by national law enables, in certain circumstances, a provision of domestic law to be construed in such a way as to avoid conflict with another rule of domestic law or the scope for that provision to be restricted to that end by applying it only in so far as it is compatible with the rule concerned, the national court is bound to use those methods in order to achieve the result sought by the directive (ECJ Joined Cases C-397/01 to C-403/01 – Pfeiffer and Others  ECR I‑8835).
EC recommendations are not binding. However, national courts are bound to take them into consideration in order to decide disputes submitted to them, in particular where they are capable of casting light on the interpretation of other provisions of national or Community law (ECJ Case C-322/88 – Grimaldi  ECR 4407).
For the amendments made by the Treaty of Lisbon with regard to these matters, Treaty on the Functioning of the European Union (TFEU).
3. Legal bases in the EC Treaty of relevance to private law
There are equivalents in the TFEU for all of the legal foundations of relevance to private law contained in the EC Treaty. For details, Treaty on the Functioning of the European Union (TFEU). Article 293 EC, however, contained a rule on the harmonization of national law through agreements between the Member States which has no equivalent in the TFEU.
Norbert Reich, Understanding EU Law (2nd edn, 2005); Fabrizio Cafaggi (ed), The Institutional Framework of European Private Law (2006); Carl Otto Lenz and Klaus Dieter Borchardt (eds), EU- und EG-Vertrag, Kommentar (4th edn, 2006); Anthony Arnull and others, Wyatt & Dashwood’s European Law (5th edn, 2006); Catherine Barnard, The Substantive Law of the EU: The Four Freedoms (2nd edn, 2007); Christian Callies and Matthias Ruffert (eds), EUV/EGV, Kommentar (3rd edn, 2007); Klemens H Fischer, Der Vertrag von Lissabon: Text und Kommentar zum Europäischen Reformvertrag (2008); House of Lords, European Union Committee, 10th Report of Session 2007–08, The Treaty of Lisbon: an impact assessment (2008); Joakim Nerglius, The EU Constitution in a Comparative and Historical Perspective: An Analysis of the Lisbon Treaty and its Importance (2009).