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Seton Hall Law

European Union Business Law: Preparing the AWR Paper: Introduction to the EU


The EU is a unique political entity comprised of 28 independent nations that have established common institutions to which they have voluntarily delegated some of their sovereignty so that decisions on specific issues of common interest can be decided at a higher, supra-national level. The countries that comprise the European Union are known collectively as the Member States.  The Treaty on the European Union states that any European country may apply for membership if it respects the democratic values of the EU and is committed to promoting them.

Though the EU in its current incarnation was officially established in 1993 with the Treaty of Maastricht, its seeds were planted in 1953 when the European Steel and Coal Community, consisting of Belgium, France, Germany, Italy, Luxembourg, and the Netherlands, was created for the purpose of regulating certain industries.  ´The impetus for the EU’s creation was a desire after WWII to avoid future inter-Europe wars and to encourage cross-border cooperation in commercial matters 
Over time, as more countries joined and priorities shifted, the EU developed as the organizational structure for broader European integration. It is currently composed of two separate but intertwined communities: the European Atomic Energy Community (Euratom) and the European Community (EC). 

Headquartered in Brussels, Belgium, the EU currently has a population of close to half a billion and an economy approximately the size of that of the United States.  The EU is currently ya leading voice in international affairs. 

EU Flag

EU Government Organizations Relationship

EU Gov't Hierarchy

Major Institutions of the EU

Legislative Body  

The European Parliament originally had a mostly advisory role in the EU; however, with the Treaty of Maastricht in 1993, it became an important legislating partner to the Council. The Parliament is currently made up of 785 members, elected directly by the population of the member states once every five years. Its major functions are to pass laws in conjunction with the Council and adopt or reject the EU budget. Parliament does not initiate legislation, but it may ask the European Commission to do so. Parliament is also responsible for holding the Commission politically accountable, and members of Parliament may question Commissioners regarding various policies. Parliament also has the power to dismiss the Commission by adopting a motion of censure.

The Council of the European Union, also known as the Council of Ministers, is the main legislative body of the EU, along with the Parliament. It is made up of 28 “ministers,” one from each member state, who are assigned specific issue areas. Its chief responsibilities include passing laws (often, but not always, in conjunction with Parliament), coordinating economic, foreign, and criminal justice policy, and making treaties. Member states with larger populations receive more votes, but most decisions require assent by qualified majority voting, which requires not only assent by a majority of member states but also a minimum of 260 (out of a total 352) votes, though some require unanimity.

Administrative Body 

The European Commission acts as the executive of the European Union, and it is the only body that may propose new legislation. The Commission is made up of 28 commissioners, one from each member state. Each one is appointed in consultation with the member states and Parliament, although the Commission’s purpose is to represent the European perspective as a whole, rather than the perspectives of individual member states. A new Commission is appointed every five years. The Commission is divided into departments, each of which is responsible for proposing new legislation and policies in a given area. The Commission also plays a major role in implementing and enforcing EU directives and regulations and it represents the EU in international negotiations.

Judicial Body 

The European Court of Justice is the major judicial body of the EU. It is made up of 28 judges, each one appointed by a member state in consultation with the other member states for six-year terms. For convenience, cases are typically decided by smaller chambers of judges, and the Court is assisted by advocates-general who present the issues of law in the case. The ECJ decides cases arising from EU law including, but not limited to, disputes about interpretation and application of treaties and/or failure to implement EU legislation. It may decide cases arising between member states, EU institutions, businesses, and individuals, and its decisions are binding.

The European General Court is the lower court to the ECJ. (Prior to the Lisbon Treaty coming into force on Dec. 1, 2009, the court was called the Court of First Instance.) It was created with limited jurisdiction in 1989, but in 2001, its jurisdiction was expanded to cover most issues that can be decided by the ECJ. However, the Court of First Instance does not decide cases brought by the member states. The Court’s decisions are subject to appeal to the ECJ, and like the ECJ, it is made up of at least 28 judges (at least on per member state), each one selected by a member state.

Financial Institution 

  • European Central Bank

    The ECB is an official EU institution at the heart of the Eurosystem and the Single Supervisory Mechanism. Over 2,500 staff from all over Europe work for the ECB in Frankfurt am Main, Germany. They perform a range of tasks in close cooperation with the national central banks within the Eurosystem and, for banking supervision, with the national supervisors within the Single Supervisory Mechanism 

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