In today’s Exponential Investor

  • Nick Hubble dives into politics
  • The EU’s constitutional rule
  • Stoush between Poland and the EU

Today I’d like to share a piece from my old mate (and long-time colleague) Nick Hubble.

We don’t usually dive into politics here in Exponential Investor – but when I read Nick’s piece, I thought it was a cracker. He asks a question I’ve never heard asked before: Is the EU actually illegal?

Read on below as Nick explores the answer – and you’ll also be able to watch Nick’s video interview with an ex-MEP, with a unique perspective on the story.

Until next time,

Sam Volkering
Editor, Exponential Investor


The threat of Polexit exposes the “legal illegitimacy” of the EU itself

The world stands aghast that a nation state like Poland would declare its own laws as having primacy over those of the EU. Does this signal a coming Polexit, we all wonder…

But the real story is not a political or eurosceptic one. And the focus on Poland is misguided too.

The standoff between Brussels and Warsaw reawakens the dormant issue of the legal illegitimacy of the EU itself. It isn’t Polexit that europhiles should fear, but the EU itself getting legally poleaxed.

You might think that support for democracy, adherence to constitutional law and the legitimacy of judicial decisions would be ideals worth upholding in Europe. But this is not the case within the EU, where the international treaties which established the EU supposedly supersede all three.

After all, the EU’s political institutions must rule the EU. And if democracy, constitutional law or the judiciary get in the way, they must therefore be illegitimate.

Unfortunately, that argument doesn’t work well in courts across Europe, which rule on legalities, not political dreams… On several occasions, they have ruled that the national constitutions continue to have primacy over the treaties that establish the EU’s powers.

So, what if the existence of the EU itself is not compliant with the national constitutions of its member states? More specifically, what happens if the treaties which establish the EU are unconstitutional and therefore invalid? Then, the EU itself is “legally illegitimate”.

The recent stoush between the EU and Poland merely highlights how this longstanding issue has never been resolved. Although the media pretends not to see it, the courts cannot ignore it. It is not an issue of political policy or euroscepticism, as the media and the EU are portraying it to be. It is a matter of rule of law and therefore far more decisive.

The underlying problem with the EU has manifested itself in Poland specifically, but far from solely, in a particular way. The question considered by the Polish court was: which law holds primacy in Poland – the national constitution or the international treaty which binds Poland to adhere to the EU courts’ supremacy?

The answer is of course obvious. The whole point of a constitution is to bind politicians’ powers. If they want to change the constitution that governs them, they cannot simply make a law to change it. They must seek popular consent in the form of a referendum.

Each nation’s constitution establishes the primacy of its political system. And so, nations cannot simply delegate away such functions to foreign bodies like the EU. Or, more precisely, the functions cannot be delegated without a referendum to change the constitution of the country in question.

Thus, if the treaty establishing the EU isn’t constitutional, it isn’t legitimate, because the national politicians who signed the treaty were bound by the constitution in what they could agree to. And so, when the Polish court ruled its own constitution to have primacy over the treaty that established EU primacy, it called into question the treaties which establish the EU itself.

This argument is confirmed by the very way the EU operates. Because the EU’s supremacy was never established in a way that is constitutionally compliant, the EU cannot make law in nation states even now. Instead, every EU “directive” we have today, must then be imposed into national law by parliaments and governments. This leads to a certain… divergence, shall we call it, in how each nation actually imposes those directives. But that’s another story.

The fact that the EU only governs Poland to the extent that Poland transcribes EU law and obeys EU decisions highlights the legally weak position of the EU and the primacy of Poland’s constitution and politics. If the EU had primacy in Poland, it wouldn’t require Polish consent on policy. EU policy would simply apply in Poland instead, and the Polish courts would rule with this in mind.

But the EU has no legal primacy inside Poland beyond what the Polish government agrees to and tries to pass on. The EU is not supreme, legally speaking. The Polish constitution still is, with the Polish government’s laws coming next in authority, and the EU a politically favoured last place.

But that political cooperation is fading. Where does this leave the pretence of the EU’s primacy, which national leaders have been keeping up? And what about the international treaties which claim to establish that primacy?

Because nation states’ constitutions were never changed to permit the international treaties which political leaders signed up to in order to establish the EU, those constitutions continue to constrain what international treaties politicians can agree to. And so, any treaty that is in violation of the national constitution is legally illegitimate.

Initially, the EU’s leaders understood this legal barrier very well. They tried to establish the EU’s legal supremacy in the legitimate way. They sought political and legal legitimacy by asking citizens to approve the powers the EU was to assume in referendums.

But this attempt to create a “Constitution for Europe”, which would have established legitimate primacy of EU law, was rebuffed in several nations across Europe. Movement towards further referendums on the “Constitution for Europe” was abandoned.

Undeterred by this rejection, the EU sought to usurp power by less legitimate means. National politicians, keen to pursue extended careers at the non-democratic EU level, signed a series of treaties which handed national powers to Brussels.

But, as explained earlier, this is incompatible with the national constitutions which those politicians are bound by. We are talking about constitutions that cannot be ignored by the judicial system – nor can they be changed without a referendum.

Exactly as intended by the separation of powers, the judiciary has repeatedly exposed the fact that the EU treaties are not compatible with national constitutions. And because the politicians who agreed to those treaties are bound by the constitution, the constitution supersedes the treaty.

Each time they do this, the judiciary is holding the executive (the government) to account by ruling on the laws that bind it. The only laws that politicians cannot change without consent from the people – the constitution.

Th same issue raised its head when the German constitutional court ruled that the German constitution held primacy over EU law on issues relating to the European Central Bank (ECB). And now the same applies in Poland in relation to judicial matters.

But the topic at hand in those court cases is not the point. The unchanged primacy of national constitutions is the real issue. This is because it implies that the EU itself is illegitimate. When courts reassert the primacy of the national constitution, they are also undermining the treaties which established the EU itself.

Of course, if national constitutions were changed, or if an EU constitution were approved in referendums, this would solve the problem. But that was attempted and it failed, further highlighting the illegitimacy of the EU.

The whole point of constitutions is that politicians cannot simply ignore them and make law which is contrary to them. The national leaders of Europe did so when they signed the Lisbon Treaty. They were legally and democratically offside. And the courts are now making them pay.

The system, until now, relied on no national government being willing to call out the EU on this issue. This pretence turned a legal issue into a political one, and the EU relied on political will remaining in its favour. If no court case challenges an unconstitutional law, it can continue to operate. But Poland has finally exposed the issue by combining a valid legal ruling with political will to challenge the system.

Thus, if Poland were to press the point, it could poleaxe the legal legitimacy of the EU itself by undermining the treaties that create it. Polexit would be a sideshow.

The EU’s various national governments are now in a pickle. Political leaders do not have the legal authority to subvert national constitutions and pretences will only last so long.

Judiciaries are calling out what political leaders have agreed to as unconstitutional. The politicians cannot both uphold international treaties which delegated supremacy to the EU and obey their own constitutions, which forbid this.

They also cannot hold referendums to change their constitutions, for a failure to win would expose the issue once again and call into question the EU as it stands, and the treaties which grant it powers.

Just as in the UK, the people of Europe must be allowed to vote on the matter. Not just for political and democratic reasons, but for legal ones.

In the EU, this would mean voting on whether their constitutions should be changed to make the EU and its legal system the highest authority in the nation. This would turn national constitutions into a legal no-man’s land.

Of course, for now, pretences are enough to hold the EU together. But for how long?

If the EU falls apart, its “legal illegitimacy” will hasten the collapse to be much faster than almost anyone expects. And what is happening in Poland now highlights this vulnerability.

Nick Hubble
Editor, Fortune & Freedom