INTRODUCTION

The European Union (EU) (English pronunciation: is an

economic and political union of 27 member states which are
located primarily in Europe. The EU traces its origins from
the European Coal and Steel Community(ECSC) and
the European Economic Community (EEC), formed by six
countries in 1951 and 1958 respectively. In the intervening
years the EU has grown in size by the accession of new
member states and in power by the addition of policy areas to
its remit. The Maastricht Treaty established the European Union
under its current name in 1993.The latest amendment to the
constitutional basis of the EU, the Treaty of Lisbon, came into
force in 2009.
The EU has developed a single market through a standardized
system of laws which apply in all member states. Within
the Scheme Area (which includes 22 EU and 4 non-EU states)
passport controls have been abolished. EU policies aim to
ensure the free movement of people, goods, services, and
capital, enact legislation in justice and home affairs, and
maintain
common
policies
on
trade,
agriculture,
fisheries and regional development. A monetary union,
the eurozone, was established in 1999 and is composed of 17
member states. Through the Common Foreign and Security
Policy the EU has developed a role in external
relations anddefence. Permanent diplomatic missions have been
established around the world. The EU is represented at
the United Nations, the WTO, the G8 and the G-20.
With a combined population of over 500 million inhabitants, or
7.3% of the world population, the EU, in 2011, generated the
largest nominal world gross domestic product (GDP) of 17.6
trillion US dollars, representing approximately 20% of the
global GDP when measured in terms of purchasing power
parity

HISTORY
After World War II, moves towards European integration were
seen by many as an escape from the extreme forms of
nationalism that had devastated the continent. One such attempt
to unite Europeans was the European Coal and Steel
Community, which was declared to be "a first step in the
federation of Europe", starting with the aim of eliminating the
possibility of further wars between its member states by means
of pooling the national heavy industries. The founding members
of the Community were Belgium, France, Italy, Luxembourg,
theNetherlands, and West Germany. The originators and
supporters of the Community includeJean Monnet, Robert
Schuman, Paul-Henri Spaak, and Alcide De Gasperi.
In 1957, the six countries signed the Treaty of Rome, which
extended the earlier cooperation within the European Coal and
Steel Community (ECSC) and created the European Economic
Community, (EEC) establishing a customs union. They also
signed another treaty on the same day creating the European
Atomic Energy Community (Euratom) for cooperation in
developing nuclear energy. Both treaties came into force in
1958.
Throughout the 1960s tensions began to show with France
seeking to limit supranational power. However, in 1965 an
agreement was reached and hence in 1967 the Merger
Treaty was signed in Brussels. It came into force on 1 July 1967
and created a single set of institutions for the three
communities, which were collectively referred to as
the European Communities (EC), although commonly just as
the European Community. Jean Rey presided over the first
merged Commission
In 1973 the Communities enlarged to include Denmark
(including Greenland, which later left the Community in 1985),
Ireland, and the United Kingdom. Norway had negotiated to
join at the same time but Norwegian voters rejected
membership in a referendum and so Norway remained outside.

In 1979, the first direct, democratic elections to the European

Parliament were held.
Greece joined in 1981, Portugal and Spain in 1986. In 1985,
the Schengen Agreement led the way toward the creation of
open borders without passport controls between most member
states and some non-member states. In 1986, the European
flag began to be used by the Community and the Single
European Act was signed.
In 1990, after the fall of the Iron Curtain, the former East
Germany became part of the Community as part of a newly
united Germany. With enlargement towards European formerly
communist countries as well as Cyprus and Malta on the
agenda, the Copenhagen criteria for candidate members to join
the European Union were agreed.
On 9 December 2011, Croatia signed the EU accession treaty.
The EU accession referendum was held in Croatia on 22
January 2012, with the majority voting for Croatia's accession
to the European Union making it the 28th member state as of
July 2013.

MEMBER STATES
The European Union is composed of 27 sovereign member
states: Austria, Belgium, Bulgaria, Cyprus, the Czech Republic,
Denmark,
Estonia,
Finland,
France, Germany,Greece, Hungary, Ireland, Italy, Latvia, Lithu
ania, Luxembourg,Malta,
the Netherlands, Poland, Portugal, Romania, Slovakia,Slovenia,
Spain, Sweden, and the United Kingdom.[46] The Union's
membership has grown from the original six founding states
Belgium, France, (then-West) Germany, Italy, Luxembourg and
the Netherlandsto the present-day 27 by successive
enlargements as countries acceded to the treatiesand by doing

so, pooled their sovereignty in exchange for representation in

the institutions.[47]
To join the EU a country must meet the Copenhagen criteria,
defined at the 1993 Copenhagen European Council. These
require a stable democracy that respects human rights and
therule of law; a functioning market economy capable of
competition within the EU; and the acceptance of the
obligations of membership, including EU law. Evaluation of a
country's fulfillment of the criteria is the responsibility of the
European Council.
Croatia is expected to become the 28th member state of the EU
on 1 July 2013 after a referendum on EU membership was
approved by Croatian voters on 22 January 2012. The Croatian
accession treaty still has to be ratified by all current EU
member states.[51]
There
are
five
candidate
countries: Iceland, Macedonia, Montenegro, Serbia and Turkey.
Albania and Bosnia and Herzegovina are officially recognized
as potential candidates. Kosovo is also listed as a potential
candidate but the European Commission does not list it as an
independent country because not all member states recognize it
as an independent country separate from Serbia.[53]
Four countries forming the EFTA (that are not EU members)
have partly committed to the EU's economy and regulations:
Iceland
(a
candidate
country
for
EU
membership), Liechtenstein and Norway, which are a part of
the single market through the European Economic Area,
and Switzerland, which has similar ties through bilateral
treaties.[54][55] The
relationships
of
the microstates,
Andorra, Monaco, San Marino and the Vatican include the use
of the euro and other areas of cooperation.[

FUNDAMENTAL RIGHTS
The last amendment to the constitutional basis of the EU came into force in
2009 and was the Lisbon Treaty.
The treaties declare that the EU itself is "founded on the values of respect for
human dignity, freedom, democracy, equality, the rule of law and respect for
human rights, including the rights of persons belonging to minorities... in a society
in which pluralism, non-discrimination, tolerance, justice, solidarity and equality
between women and men prevail."[84]
In 2009 the Lisbon Treaty gave legal effect to the Charter of Fundamental Rights
of the European Union. The charter is a codified catalogue of fundamental
rights against which the EU's legal acts can be judged. The Court of Justice has
long recognised fundamental rights and has, on occasion, invalidated EU
legislation based on its failure to adhere to those fundamental rights. [86] The Charter
of Fundamental Rights was drawn up in 2000. Although originally not legally
binding the Charter was frequently cited by the EU's courts as encapsulating rights
which the courts had long recognised as the fundamental principles of EU law.
Although signing the European Convention on Human Rights (ECHR) is a
condition for EU membership,[h] previously, the EU itself could not accede to the
Convention as it is neither a state [i] nor had the competence to accede.[j] The Lisbon
Treaty and Protocol 14 to the ECHR have changed this: the former binds the EU to
accede to the Convention while the latter formally permits it.
The Modern-Day EU
Throughout the 1990s, the "single market" idea allowed easier
trade, more citizen interaction on issues such as the
environment and security, and easier travel through the different
countries.
Even though the countries of Europe had various treaties in
place prior to the early 1990s, this time is generally recognized
as the period when the modern day European Union arose due
to the Treaty of Maastricht on European Union which was

signed on February 7, 1992 and put into action on November 1,

1993.
The Treaty of Maastricht identified five goals designed to unify
Europe in more ways than just economically. The goals are:
1) To strengthen the democratic governing of participating
nations.
2) To improve the efficiency of the nations.
3) To establish an economic and financial unification.
4) To develop the "Community social dimension."
5) To establish a security policy for involved nations.
In order to reach these goals, the Treaty of Maastricht has
various policies dealing with issues such as industry, education,
and youth. In addition, the Treaty put a single European
currency, the euro, in the works to establish fiscal unification in
1999. In 2004 and 2007, the EU expanded, bringing the total
number of member states as of 2008 to 27.
In December 2007, all of the member nations signed the Treaty
of Lisbon in hopes of making the EU more democratic and
efficient to deal with climate change, national security, and
sustainable development.
The EU Mission
As in 1949 when it was founded with the creation of the Council of Europe, the
European Union's mission for today is to continue prosperity, freedom,

communication and ease of travel and commerce for its citizens. The EU is able to
maintain this
mission through the various treaties making it function, cooperation from member
states, and its unique governmental structure.
The United Kingdom of Great Britain and Northern Ireland, commonly known
as the United Kingdom (UK) or Britain,[nb 5] is a sovereign state in Europe. Lying
off the north-western coast of the European mainland, the country includes the
island of Great Britaina term also applied loosely to refer to the whole country
the north-eastern part of the island of Ireland and many smaller islands.[8] Northern
Ireland is the only part of the UK that shares a land border with another state (the
Republic of Ireland).[nb 6] Apart from this land border, the UK is surrounded by the
Atlantic Ocean, with the North Sea to its east, the English Channel to its south and
the Celtic Sea to its south-southwest. The Irish Sea lies between Great Britain and
Ireland. The UK has an area of 93,800 square miles (243,000 km2), making it the
80th-largest sovereign state in the world and the 11th-largest in Europe.
The United Kingdom is the 22nd-most populous country, with
an estimated 64.5 million inhabitants.[4] It is a constitutional
monarchy with a parliamentary system of governance.[9][10] Its
capital city is London, an important global city and financial
centre with an urban population of 10,310,000, the fourthlargest in Europe and second-largest in the European Union.[11]
The current monarchsince 6 February 1952is Queen
Elizabeth II. The UK consists of four countries: England,
Scotland, Wales, and Northern Ireland.[12] The latter three have
devolved administrations,[13] each with varying powers,[14][15]
based in their capitals, Edinburgh, Cardiff, and Belfast,

respectively. The nearby Isle of Man, Bailiwick of Guernsey

and Bailiwick of Jersey are not part of the United Kingdom,
being Crown dependencies with the British Government
responsible for defence and international representation.[16]
The relationships among the countries of the United Kingdom
have changed over time. Wales was annexed by the Kingdom of
England under the Acts of Union of 1536 and 1543. A treaty
between England and Scotland resulted in 1707 in a unified
Kingdom of Great Britain, which merged in 1801 with the
Kingdom of Ireland to form the United Kingdom of Great
Britain and Ireland. In 1922, five-sixths of Ireland seceded from
the country, leaving the present formulation of the United
Kingdom of Great Britain and Northern Ireland.[nb 7] The UK has
fourteen Overseas Territories.[17] These are the remnants of the
British Empire which, at its height in the 1920s, encompassed
almost a quarter of the world's land mass and was the largest
empire in history. British influence can be observed in the
language, culture, and legal systems of many of its former
colonies.
The United Kingdom is a developed country and has the
world's fifth-largest economy by nominal GDP and tenthlargest economy by purchasing power parity. The UK is
considered to have a high-income economy and is categorised
as very high in the Human Development Index, currently
ranking 14th in the world. It was the world's first industrialised
country and the world's foremost power during the 19th and

early 20th centuries.[18][19] The UK remains a great power with

considerable economic, cultural, military, scientific, and
political influence internationally.[20][21] It is a recognised nuclear
weapons state and its military expenditure ranks fifth or sixth in
the world.[22][23] The UK has been a permanent member of the
United Nations Security Council since its first session in 1946.
It has been a member state of the European Union (EU) and its
predecessor, the European Economic Community (EEC), since
1973; it is also a member of the Commonwealth of Nations, the
Council of Europe, the G7 finance ministers, the G7 forum, the
G20, NATO, the Organisation for Economic Co-operation and
Development (OECD), and the World Trade Organization
(WTO).

Etymology and terminology

The 1707 Acts of Union declared that the kingdoms of England and Scotland were
"United into One Kingdom by the Name of Great Britain", though the new state is
also referred to in the Acts as the "Kingdom of Great Britain", "United Kingdom of
Great Britain" and "United Kingdom".[24][25][nb 8] However, the term "United
Kingdom" is only found in informal use during the 18th century and the country
was only occasionally referred to as the "United Kingdom of Great Britain"its
full official name, from 1707 to 1800, being merely Great Britain, without a "long
form".[26][27][28][29][30] The Acts of Union 1800 united the Kingdom of Great Britain
and the Kingdom of Ireland in 1801, forming the United Kingdom of Great Britain
and Ireland. The name "United Kingdom of Great Britain and Northern Ireland"

was adopted following the independence of the Irish Free State, and the partition of
Ireland, in 1922, which left Northern Ireland as the only part of the island of
Ireland within the UK.[31]
Although the United Kingdom, as a sovereign state, is a country, England,
Scotland, Wales, and to a lesser degree, Northern Ireland, are also regarded as
countries, though they are not sovereign states.[32][33] Scotland, Wales and Northern
Ireland have devolved self-government.[34][35] The British Prime Minister's website
has used the phrase "countries within a country" to describe the United Kingdom.
[12]

Some statistical summaries, such as those for the twelve NUTS 1 regions of the

UK, also refer to Scotland, Wales and Northern Ireland as "regions".[36][37] Northern
Ireland is also referred to as a "province".[38][39] With regard to Northern Ireland, the
descriptive name used "can be controversial, with the choice often revealing one's
political preferences."[40]
The term Britain is often used as synonym for the United Kingdom. The term
Great Britain, by contrast, refers conventionally to the island of Great Britain, or
politically to England, Scotland and Wales in combination.[41][42][43] However, it is
sometimes used as a loose synonym for the United Kingdom as a whole.[44][45] GB
and GBR are the standard country codes for the United Kingdom (see ISO 3166-2
and ISO 3166-1 alpha-3) and are consequently used by international organisations
to refer to the United Kingdom. Additionally, the United Kingdom's Olympic team
competes under the name "Great Britain" or "Team GB".[46][47]
The adjective British is commonly used to refer to matters relating to the United
Kingdom. The term has no definite legal connotation, but is used in law to refer to
UK citizenship and matters to do with nationality.[48] People of the United
Kingdom use a number of different terms to describe their national identity and

may identify themselves as being British; or as being English, Scottish, Welsh,

Northern Irish, or Irish;[49] or as being both.[50]

A History of the European Union and Great Britain

1957

The Treaty of Rome was signed by 6 European

states

1967

The European Community was established

1973

Britain joined the European Community. Tory

Prime Minister Edward Heath took Britain in.

1975

Labour Prime Minister Harold Wilson had a

referendum on Britains membership the last
national referendum this country has had. 66%
voted yes to stay in the European Community

1987

The Single European Act was signed. This was

to create an internal market; an area without

frontiers in which the free movement of goods

and persons, services and capital is ensured.

1991

The Maastrict Treaty was signed. The heart of

this was to create a single European currency
so that Europe as an entity had a currency to
challenge the international supremacy of the
dollar. Britain, lead by Tory Prime Minister
John Major, pushed for and got an opt out
clause for Britain. This meant that we were
part of the European Community and wanted
to be a part of it, but not to participate in a
single currency, therefore, maintaining the
pound should we decide to do so.

1993

The European Union was formed

Proposed referendum on United Kingdom membership of

the European Union

A referendum on whether the United Kingdom should remain a

member or leave the European Union (EU) is planned to take
place before the end of 2017.[2]
Following the general election in May 2015, in which his
Conservative Party won a majority in the House of Commons,
Prime Minister David Cameron reiterated the party's manifesto
commitment to hold an "in-out" referendum on Britain's
membership of the European Union by the end of 2017,
following negotiations with EU leaders.[3] The planned

referendum was included in the Queen's Speech on 27 May

2015.[4] It has been suggested that Cameron is planning to have
the referendum held in October 2016.[5] Government-sponsored
legislation to authorise the referendum was introduced in the
House of Commons in May 2015.[6]
Since 2010, polls have indicated that the British public are
divided on the question, with opposition to EU membership
peaking in November 2012 at 56% compared to 30% who
wanted to remain,[7] while in June 2015 those in favour of
Britain remaining in the EU reached 43% and those opposed
36%.[8] The largest ever poll (of 20,000 people, in March 2014)
showed the public evenly split on the issue, with 41% in favour
of withdrawal, 41% in favour of membership, and 18%
undecided.[9] However, when asked how they would vote if
Britain renegotiated the terms of its membership of the EU, and
the government said that British interests had been protected,
more than 50% said that they would vote for Britain to stay in.[10]
Membership of the European Union has long been a
controversial issue in the United Kingdom. Eurosceptics, who
believe that the UK would be better off outside the political and
economic bloc, seek complete withdrawal from the European
Union. The portmanteau term "Brexit" is sometimes used to
refer to a British exit from the EU.[11][12][13][14]
The only referendum previously held on this topic in the United
Kingdom occurred in 1975, when a majority of those voting
endorsed continuation of the UK's membership of the European
Economic Community, which later became the EU.

History

David Cameron
In January 2013, David Cameron said that if the
Conservatives won a majority in the general
election in 2015, the government would negotiate
new agreements with the EU and would then hold
a referendum on whether to remain in or leave
the EU.[16] Political leaders in the EU criticised
the possibility of British renegotiation and
publicly supported Britain's continued
membership.[17] However, public polls in France
and Germany favoured a British exit.[17] The
Obama administration warned against a British
exit from the European Union, arguing that it
would reduce the British "voice" in the EU and
would not be in the best interest of the United
States.[18]
Cameron had previously rejected proposals to
hold a referendum on Britain's membership of the

EU, but had suggested the possibility of a

referendum at some later date to ensure that the
UK's position within an evolving EU had the
"full-hearted support of the British people".[19]
Under Ed Miliband's leadership, from 2010 to
2015, the Labour Party ruled out an in-out
referendum unless there was a transfer of powers
from the UK to the EU.[20] In their manifesto for
the general election of 2015 the Liberal
Democrats committed to an in-out referendum
only if there was a "material transfer of
sovereignty" from the UK.[21] The UK
Independence Party (UKIP), the British National
Party, the Green Party,[22] and the Respect
Party[23] have all supported the idea of a
referendum.
Private member's bill
In May 2013, the Conservative Party published a
draft EU referendum bill and outlined their plans
for renegotiation and then an in-out vote if
returned to office in 2015.[24] The draft bill stated
that the referendum must be held no later than 31
December 2017.[25]
The draft was taken forward as a private
member's bill by Conservative MP James

Wharton.[26] The bill's first reading in the House

of Commons was made on 19 June 2013.[27]
David Cameron, was said by a spokesperson to
be "very pleased" and would ensure the bill was
given "the full support of the Conservative
Party".[28]
Regarding the ability of the bill to force the next
parliament into holding a referendum, a
parliamentary research paper has noted that:
"The Bill simply provides for a referendum on continued
EU membership by the end of December 2017 and does not
otherwise specify the timing, other than requiring the
Secretary of State to bring forward orders by the end of
2016. These orders would need both Houses to agree to the
detailed rules for the poll and the date. If no party obtained
a majority at the next general election due in 2015, there
might be some uncertainty about the passage of the orders
in the next Parliament. Unless the orders are passed, it
would not appear possible to hold the referendum, since the
day and the conduct of the poll would not have received
parliamentary assent."[29]
The Bill received its second reading on 5 July
2013 by 304 votes to none after almost all Labour
MPs and all Liberal Democrat MPs abstained.[30]

and finally cleared the Commons in November

2013. It was introduced to the House of Lords in
December 2013, but failed to pass after the Lords
voted to block the bill.[31]
Conservative MP Bob Neill introduced an
alternative referendum bill to the Commons after
coming third in an annual ballot for private
members' bills on 2 July 2014.[32][33] After a
debate on 17 October 2014, it passed to the
public bills committee, but due to the Commons
failing to pass a money resolution the bill was
unable to progress further until the dissolution of
parliament on 27 March 2015.[
EU referendum bill
Before the 2015 general election, the
Conservatives pledged in their manifesto to
legislate for an EU referendum to be held by the
end of 2017.[3] Following the election of a
Conservative majority government on 7 May,
Cameron reiterated that pledge, suggesting it
might be brought forward to 2016.[43][44] The
government included the planned referendum in
the Queen's speech on 27 May[4] and introduced
the European Union Referendum Bill 201516 in
the House of Commons on the next day.

Shortly after his re-election, Cameron visited a

number of EU leaders to discuss renegotiation
and treaty change to be agreed before the
referendum.[45]
In contrast to the Labour Party's position before
the general election, acting leader Harriet
Harman said the party would support plans for an
EU referendum by 2017.[46] The Liberal
Democrats oppose a referendum by 2017,
suggesting one in the case of further transfer of
sovereignty to the EU.[47] The DUP support
having a referendum.[
Referendum question
The proposed question in the European Union
Referendum Bill as introduced into Parliament
was
Should the United Kingdom remain a member of
the European Union or leave the European
Union?
and in Welsh
A ddylair Deyrnas Unedig aros yn aelod or
Undeb Ewropeaidd neu adael yr Undeb
Ewropeaidd?

with a remain/leave answer.

The Electoral Commission has since
recommended that the text be changed to
Should the United Kingdom remain a member
of the European Union or leave the European
Union?
Remain a member of the European Union
Leave the European Union
and in Welsh
Research by the Electoral Commission confirmed
that the recommended question "was clear and
straightforward for voters, and was the most
neutral wording from the range of options ...
considered and tested.".
Procedure
No member state has ever left the European
Union. The United Kingdom voted to remain a
member of the European Communities in a 1975
referendum. Three former territories of EU
member states have withdrawn from the EU (or
its predecessors): Algeria (1962),[50] Greenland
(1985)[51] and Saint Barthlemy (2012) with the

latter two becoming Overseas Countries and

Territories of the European Union.
Before the Treaty of Lisbon entered into force on
1 December 2009, no provision in the treaties or
law of the European Union outlined the ability of
a member state to voluntarily withdraw from the
EU.[52]
The Treaty establishing a Constitution for Europe
provided that any member could voluntarily leave
the Union of its own accord[53] but this treaty was
never ratified. However the voluntary withdrawal
clause survived into the Lisbon Treaty as Article
50 of the Treaty on European Union.[54]
This new provision formalised the procedure by
stating that a member state may notify the
European Council that it wishes to withdraw,
upon which withdrawal negotiations begin. If no
other agreement is reached the treaty ceases to
apply to the withdrawing state two years after
such notification.
The remaining members of the EU would also
need to undertake negotiations to manage the
changes to the EU's budgets, voting allocations

and policies brought about by the withdrawal of a

member state.
Results of a withdrawal
Were the UK to withdraw from the EU, its
subsequent relationship with the organisation
could take several forms. A research paper
presented to the parliament of the UK proposed a
number of alternatives to membership which
would continue to allow it access to the EU's
internal market. These include remaining in the
European Economic Area (EEA) as a European
Free Trade Association (EFTA) member or a
bilateral model along Swiss lines with a series of
interdependent sectoral agreements.[56]
European Economic Area
Non-EU members of the European Economic
Area must adopt EU single market legislation
without having a vote on its content, though the
EU is required to extensively consult with nonEU members beforehand, through many
committees and cooperative bodies, and the said
members possess an opt-out.[57][58] It should also
be noted that some EU law originates from
various international bodies which non-EU EEA
countries have a seat on. The EEA agreement

(EU and EFTA members except Switzerland)

does not cover common agriculture and fisheries
policies, customs union, common trade policy,
common foreign and security policy, direct and
indirect taxation, and justice and home affairs,
leaving EFTA members free to set their own
policies in these areas.[59] The EFTA countries and
contribute to the EU budget in exchange for their
access to the single market.[60] The government of
Iceland decided to keep this status, withdrawing
their application for membership in March 2015.
[61]

Around 1.4 million British nationals have

exercised their right to freedom of movement to
live, work or study in the European Union
according to the British government.[62] British
citizens are currently able to study in EEA
countries at the same cost as charged to their own
citizens: this arrangement applies equally
between EU states. Were Britain to leave the
EU/the EEA, British citizens would lose these
rights. The status of the Common Travel Area
between a UK outside the EU and EU member
Ireland remains to be clarified.

Alternative proposals
UKIP have proposed that the UK could attempt
to create a Commonwealth Free Trade Area to
compensate for trade lost by leaving the EU
single market.[63] The idea of a series of bilateral
free trade agreements, or even a full
Commonwealth Free Trade Area was discussed at
the 2005 Malta Commonwealth Heads of
Government Meeting. In response, the European
Movement pointed out that the UK trades more
with Ireland than with all the leading developing
countries combined, the so-called BRIC
economies of Brazil, Russia, India and China
(only one of which, India, is in the
Commonwealth).[64] The European Movement
also notes that the British economy is most
similar to other European economies as opposed
to other countries.[64]
Response
Politicians wishing to remain in the EU
Current Labour Party,[65][66][67] Liberal Democrat,
[68]
SNP,[69][70] Plaid Cymru and Green Party of
England and Wales[71] policy is to support
remaining in the EU (although some individual

members of some of those parties support

leaving).
Politicians wishing to leave the EU
The UKIP are within the "Leave.EU" campaign.
The minor parties in favour of exiting the
European Union are the SWP, the English
Democrats,[72] the BNP as well as the TUV in
Northern Ireland.[73] The second organisation
campaigning for Britain to exit the European
Union are 'Vote Leave', who were formed on 8
October 2015.[74]
Within the Conservative Party: The campaign from within
the Conservative Party to exit the EU is "Conservatives For
Britain", being headed by Nigel Lawson and Norman
Lamont.[75] Daniel Hannan, David Campbell-Bannerman,
Norman Tebbit,[76] Bill Cash, Peter Bone, Philip Davies,
Philip Hollobone,[77] and Jacob Rees-Mogg.[78] The
conservative think-tank Bow Group has also supported the
"Leave.EU" campaign.[79]
Within the Labour Party: Kate Hoey,[80] Austin Mitchell
and Gisela Stuart.[81] Former chancellor Denis Healey had
advocated Britain's withdrawal from the EU.[82]
Politicians wishing to remain neutral
The Conservative Party is to officially remain
neutral during the referendum campaign, even

though David Cameron will campaign to stay in

the EU.[83]
Media wishing to leave the EU
Daily Express[84]
Business opinion
Many companies have stated that they are proEU such as Shell,[85] BT[86] and Vodaphone,[87]
while some have admitted they are thinking of
moving investment elsewhere if Britain splits.[88]
The Banking Sector is the loudest voice
advocating to stay in the EU. The British Bankers
Association said 'Businesses don't like that kind
of uncertainty'.[89] RBS has warned of damages to
the economy.[90] Furthermore, HSBC, JP Morgan
and Deutsche Bank have told that a Brexit might
result in them moving country.[91][92] All of this
risking London's title of Financial Capital.[93][94]
Within the Transportation industry, most
companies also tend to be Pro-EU. Car
manufacturers Ford and BMW have warned
Prime Minister David Cameron against an EU
exit, insisting it would be "devastating" for the
British economy.[95] Yet despite this executives
have stated that 'British plants were not at risk

were the country to leave'.[96] On top of this

Vauxhall has come out in favour of the No
campaign.[97]
Brexit companies include JCB and Vauxhall.[98]
A FebruaryMarch 2013 survey of 4,387
companies by business lobby group the British
Chambers of Commerce found that 18 per cent of
UK companies were in favour of entire
withdrawal from the European Union,[99] and that
33 per cent of businesses were in favour of
withdrawal and negotiating a free-trade deal. 60
per cent said a withdrawal could "harm their
business",[99] while 23 per cent said that further
integration would be "beneficial" for their
company.[99] On commenting on the survey, the
groups General Director, John Longworth, said
These findings suggest that U.K. businesses
increasingly feel that some sort of change to
Britains relationship with the EU is needed to
boost our trading prospects."
In September 2013, a YouGov/Business for
Britain survey of 1024 UK business leaders
found that by 46% 37%, British businesses said
that the costs of the Single Market out-weigh the

benefits of being in the EU, by 66% 26%,

businesses support a referendum on the EU, and
by 56% 23%, business leaders believe a
meaningful change would require a treaty
change, and would like to see Britain's
relationship with the EU focused on trade.[100]
International reaction
In response to David Cameron's January 2013
speech on the EU, several countries submitted
their views on the proposal and on the UK-EU
relationship. The U.S. Obama administration
expressed the belief that the United Kingdom is
stronger in the European Union, and that the EU
is stronger through having British membership.
[101]
The German Defence Minister, Thomas de
Maiziere, claimed that it would diminish British
influence in NATO.[102] French President Franois
Hollande, in a speech to the European
Parliament, said there could be no la carte
option for European membership.[103] In response
to British Foreign Secretary William Hague's
review of EU competencies, the Japanese
Government said "The Government of
Japan...expects that the UK will maintain a strong
voice and continue to play a major role in the

EU".[104] In July 2013, a letter from the Australian

Foreign Minister Bob Carr said "Australia
recognises the UK's strength and resilience and
looks forward to seeing it continue as a leading
economy and effective power. Strong effective
membership of the EU contributes to this."[105]
The Swedish finance minister, Anders Borg,
expressed that this was a serious matter, and that
for Sweden the issue raised some concerns and
could reorient the EU.[106]
A report by Tim Oliver of the German Institute
for International and Security Affairs noted that
there has been little analysis of what a British
withdrawal could mean for the EU. The report
argues a UK withdrawal "has the potential to
fundamentally change the EU and European
integration. On the one hand, a withdrawal could
tip the EU towards protectionism, exacerbate
existing division, or unleash centrifugal forces
leading to the EUs unravelling. Alternatively, the
EU could free itself of its most awkward member,
making the EU easier to lead and more
effective."[55]

Ratings agency response

On 11 June 2015, ratings agency Standard and
Poors changed its outlook for the UK economy
from 'neutral' to 'negative', saying that the
referendum "represents a risk to growth
prospects" for the country's economy.[107] [As of
June 2015, S&P is the only agency that still gives
the UK a AAA rating].[107]
Let Britain Decide
Let Britain Decide is a political campaign by the
Conservative Party that seeks a referendum on
the UK's relationship with the European Union.
[108]
It was set up in June 2013 by party chairman
Grant Shapps MP. The movement aims to force
an in-out vote commitment on EU membership
from both major parties and the Lib Dems.[citation
needed]

Exit plan competition

Following David Cameron's announcement of an
EU referendum, British think tank the Institute of
Economic Affairs (IEA) announced in July 2013
a competition to find the best plan for a UK exit
from the European Union, declaring that a
departure is a 'real possibility' after the next
election.[109] Those interested were asked to

submit a 2,000-word proposal by 16 September

2013, with seventeen of the best entrants being
asked to produce a more detailed version.[110]
Eight judges, including former Chancellor of the
Exchequer Nigel Lawson, decided the winner.[110]
The winning entry was awarded 100,000 euros
(86,525), and was announced on 8 April 2014.

European Parliament
There are 73 members of the European
Parliament from the UK. Find out who these
MEPs are.
European Parliament office in the United
Kingdom
Council of the EU
In the Council of the EU, national ministers meet
regularly to adopt EU laws and coordinate
policies. Council meetings are regularly attended
by representatives from the UK government,
depending on the policy area being addressed.
Presidency of the Council of the EU
The Council of the EU doesn't have a permanent,
single-person president (like e.g. the Commission

or Parliament). Instead, its work is led by the

country holding the Council presidency, which
rotates every 6 months.
During these 6 months, ministers from that
country's government chair and help determine
the agenda of Council meetings in each policy
area, and facilitate dialogue with the other EU
institutions.
Dates of UK presidencies:
Jan-Jun 1977 | Jul-Dec 1981 | Jul-Dec 1992 | JanJun 1998 | Jul-Dec 2005 | Jul-Dec 2017
More on the current presidency of the Council of
the EU.
European Commission
The Commissioner nominated by the UK to the
European Commission is Jonathan Hill, who is
responsible for Financial Stability, Financial
Services and Capital Markets Union.
The Commission is represented in each EU
country by a local office, called a
"representation".

Commission representation in the United

Kingdom
European Economic & Social Committee
The United Kingdom has 24 representatives on
the European Economic and Social Committee.
This advisory body representing employers,
workers and other interest groups is consulted
on proposed laws, to get a better idea of the
possible changes to work and social situations in
member countries.
Committee of the Regions
The United Kingdom has 24 representatives on
the Committee of the Regions, the EU's assembly
of regional and local representatives. This
advisory body is consulted on proposed laws, to
ensure these laws take account of the perspective
from each region of the EU.
Permanent representation to the EU
The UK also communicates with the EU
institutions through its permanent representation
in Brussels. As the United Kingdom's "embassy
to the EU", its main task is to ensure that the
country's interests and policies are pursued as
effectively as possible in the EU.

Budgets and Funding

How much does the UK contribute and receive?
Member countries' financial contributions to the
EU budget are shared fairly, according to means.
The larger your country's economy, the more it
pays and vice versa. The EU budget doesn't aim
to redistribute wealth, but rather to focus on the
needs of all Europeans as a whole.
Breakdown of the UK's finances with the EU in
2013:
Total EU spending in the UK: 6.308 billion
Total EU spending as % of the UKs GNI: 0.34 %
Total UK contribution to the EU budget: 14.510 billion
The UKs Contribution to the EU budget as % of its GNI:
0.77 %
EU-funded projects in the UK
The money paid into the EU budget by the UK
helps fund programmes and projects in all EU
countries - like building roads, subsidising
researchers and protecting the environment.
UK public expenditure is more than five times
bigger than the EU budget. According to the UK

statistics which offset some non-tax

government revenue against expenditure net
public spending (from April 2012 to April 2013)
reached GBP 675 billion (EUR 805 billion), that
is 42 % of the country's GNI.
According to the EU's statistics (*), the UK's
public expenditure amounted in 2013 to around
GBP 700 billion (EUR 894 billion).
Just for comparison, using the same method
Germany's public expenditure amounted to
around GBP 957 billion (EUR 1 223 billion) and
that of Lithuania to around GBP 9.4 billion (EUR
12 billion) in 2013.
The EU budget for the 28 member States on the
other hand was around GBP 120 billion (EUR
144 billion), roughly 1 % of the Union's GNI.
UKThe EUThe EU budget vs national expenditure(in % of GNI)
0% 10% 20% 30% 40% 50%
The EU and national budgets serve different, yet
complementary purposes. The EU budget
targets areas where EU money can generate
added value. For example, a project of such
magnitude as the European satellite navigation

system Galileo could not be financed by a single

Member State alone.
Unlike the UK budget or any other national
budget the EU budget does not fund defence
expenditure or social protection, but is mostly
investment spending. For example, the EU
financed more than half of the investment needed
to provide Cornwall and the Isles of Scilly with
superfast broadband by 2015, making the region
one of the best-connected places in the world.
The EU budget in 2013EUR 144
billion40%48%6%5%1%Citizenship, Freedom, Securityand
JusticeEU as a global playerAdministrationSustainable
GrowthNatural Resources
In 2013, the three main spending areas of the UK
budget were social protection, health and
education.
The UK pays more into the EU budget than it
receives from it. However, the net balance does
not accurately reflect the many benefits of EU
membership. Many of them, such as peace,
political stability, security and freedom to live,
work, study and travel anywhere in the Union
cannot be measured. The UK government

estimates that the single market brings in between

GBP 31 billion and GBP 92 billion a year into the
UK economy or between 5 and 15 times the
UK net contribution to the EU budget, which,
once the UKs rebate is taken into account,
amounted to about GBP 7.258 billion - EUR
8.641 billion in 2013.
Moreover, European investments are intended
to benefit the EU as a whole, and European
funding in one country can benefit other EU
members. Thanks to the single market, UK
companies get contracts under EU-funded
projects in other European countries. For
example, the UK company, Intersurgical, was
involved in two projects modernising production
in Lithuania in 2009 and 2010. It received
approximately GBP 1.05 million (EUR 1.25
million) for its contribution.
The UK is also one of the top recipients of EU
research funding, second only to Germany.
Research into revolutionary material graphene,
discovered by scientists at Manchester University
and set to become the wonder material of the 21st
century, will receive GBP 45.36 million (EUR 54
million) from the EU.

Operating budgetary balance: the difference

between what a country receives from and pays
into the EU budget. There are many possible
methods of calculating budgetary balances. In its
financial report,the Commission uses a method
based on the same principles as the calculation of
the correction of budgetary imbalances granted to
the United Kingdom (the UK correction). It is,
however, important to point out that constructing
estimates of budgetary balances is merely an
accounting exercise of the purely financial costs
and benefits that each Member State derives from
the Union and it gives no indication of many of
the other benefits gained from EU policies such
as those relating to the internal market and
economic integration, not to mention political
stability and security.
EU funding in the UK (2013)GBP 5.3 billion- EUR 6.3
billion63%23%10%2%2%AdministrationCitizeship, Freedom,
Securityand JusticeRegional policyGrowth and JobsAgriculture
Too much money spent on agriculture?
EU countries have made agriculture a European
rather than national policy. It is the only policy
almost entirely funded by the EU. That is why
it represents a large proportion of the EU budget.

It is also less costly for EU countries as a whole,

than implementing 28 different national policies.
The common agricultural policy has undergone a
major reform, whereby its share of the EU
budget has fallen from 70 % in 1985 to around 40
% today, and is set to continue falling to 33 % in
2020. It has also been refocused to avoid
encouraging unnecessary production there is no
more talk of wine lakes and butter mountains. A
new reform which came into force in 2014 will
further strengthen European agricultural
competitiveness, making it more environmentally
friendly and reducing the gap for countries
receiving less money than the EU average.
* The difference between the two figures is
because the UK government, in public spending
figures used nationally, offsets against
expenditure some non-tax revenue (such as
charges for various services and for publications,
licences, rents on government owned property,
etc) to give a net figure. The Ameco statistics do
not deduct this revenue from overall public
spending and therefore are higher.

UK Trade with the European Union

UK trade in goods and services with fellow members of the
European Union has deepened in the 36 years since we joined
the European community. As of 2008 our geographical pattern
of trade was as follows:

Main export markets:

European Union 57%
United States: 15%
Switzerland: 2%
China: 2%
Japan: 2%
Main source of imports:
European Union 55%
USA: 9%
China: 8%
Norway: 5%
Japan: 3%
a customs union a customs union comprises two or more
countries which agree to:
1. Abolish tariffs and quotas to encourage free trade. For
example, products that originate in the EU circulate duty-free.
However they might be subject to charges such as VAT.
2. Adopt a common external tariff (CET) on imports from nonmembers countries. Thus, in the case of the EU, the tariff
imposed on, say, imports of South Korean digital cameras will
be the same in the UK as in France or Hungary. A CET

prevents individual countries imposing their own unilateral

tariffs that differ from other in the customs union.
1. A customs union has trade creation and trade diversion
effects.
2. Trade creation involves a shift in peoples spending from a
higher-cost domestic source to a lower-cost partner-source
within the EU, as a result of the abolition of tariffs. UK
consumers may switch spending on car insurance away
from a higher-priced UK supplier towards a German
insurance company that has decided to operate in the UK
market.
3. In principle, trade creation stimulates an increase in intraEU trade and ought to lead to a more efficient allocation of
scarce resources thereby leading to gains in consumer and
producer welfare.
4. Trade diversion happens when there is a shift in domestic
consumer spending away from a lower-cost world source to
a higher cost partner source country from within the EU as a result of the elimination of tariffs on imports from the
partner. The common external tariff on many products
entering Europe makes imports more expensive leading to
higher costs for producers and rising prices for consumers
if previously they had access to a cheaper supply from a
non-EU country. The effect is a reduction in consumer and
producer welfare.

The UK has seen a growing trade deficit with the EU as a whole

Total exports grew from 113bn in 2001 to 139bn in 2007 but
imports grew more quickly from 120bn to 185bn over the
same period.
8 of our top export markets are inside the EU (China and USA
are the other 2)
Export growth:
The table on the left shows the average annual growth rates for
UK exports of goods and services to selected EU countries.
Consider the following questions:
1. Can you explain why the top eight countries for UK export
growth are also nations that joined the EU in 2004 or 2007?
2. Since 2007-8 the value of sterling against the Euro has
depreciated by more than 25%. Analyse how this might affect
trade between the UK and the Euro Area
3. Explain three factors (other than the exchange rate) that can
affect the competitiveness of UK exporters within the
European single market

4. The Euro Area economy is in deep recession in 2009. Explain

how this might affect the UK economy.