Zone 2 – European Federation Single Market

The setting up of this Zone may start in parallel to the transition of the Eurozone into the EF. This zone will have its own Treaty, modelled on the cut-down version of the Lisbon Treaty. I will not cover the details of this Treaty, but rather focus on the differences between the EFCA (Zone 2) and EFSM. As you will see a lot of the principles of EFCA will stay the same, but some will be quite significantly changed. This is why I believe this Zone will be an ideal escape route for Britain.

These are some principles of the EFSM Treaty that I would propose:

  1. Principles and values. The joining members will have to accept the Universal Values of Humanity, which will particularly include:
  • A non-faith based system of government, education and social activities (apart from churches, mosques and other religious institutions)
  • Aiming to convert any non- hereditary system of governance into a representative Democracy
  • A predominantly Judaeo-Christian homogenous culture. (To avoid even bigger internal tensions than there are today, Europe cannot risk multiculturalism on a grand scale, nor taking new members from entirely different cultures)
  1. Constitutional relevance. The joining members will:
  • Become a member of the EFSM
  • Accept the EF Treaty
  • Strongly support the process of decision making at all levels through consensus rather than arbitrarily impose the rule of majority
  • Accession, suspension and expelling of EFSM member state is the sole power of the EF Government
  1. EFSM structure and powers. The joining members will have to accept that:
  • EFSM has its own Treaty
  • The EFSM members accept to support at times of utmost urgency the actions of the President or the Prime Minister of the EF, if they have to react to events at national or global scale, even if it meant a temporary suspension of their sovereignty rights
  1. A written constitution. Every member state of the EFSM must have a written constitution. Countries that do not have it yet, will be granted some time to introduce the necessary jurisdiction.
  2. Respect for the rulings of the European Constitutional Court and the European Court of Justice. Each member’s constitution will have to be approved by the European Constitutional Court for its adherence to the Federation’s values.
  3. EFSM Assembly. It consists of one chamber of representatives from individual states. The Assembly term is five years. Candidates are elected for a maximum of two terms.
  4. Electoral systems within the EFSM nations. As long as the EF’s Constitutional Court accepts them as ‘democratic’ voting systems, it should be up to those countries, which system they select, since the voting system should suit a particular cultural and ethnic composition of a given country.
  5. Multiparty system. People can organize themselves into parties within EFSM states or across the whole EFSM.
  6. Electoral system for the EFSM. Proportional representation system is in place to select candidates. Two Rounds System (TRS) ensures that each candidate gets at least 50% of the votes plus 1.
  7. EFSM President. He represents EFSM and heads the EFSM Commission. He is elected for a fixed 5-year term and can serve a maximum of two terms.
  8. The EFSM Commission. This replaces the former EU Commission. It is headed by the EFSM President (there is no separate Prime Minister). However, all Commissioners are now Ministers, who are experts selected from a common EFSM pool of experts.
  9. Foreign affairs area. The EFSM members do not have their joint Foreign Policy Minister and they can carry out their foreign policy independently, being closely harmonized with the EF.
  10. Defence area. This area will be co-ordinated but not ruled by the EF Defence Minister. Each country will retain its own Defence Minister. This may change rapidly depending on political situation.
  11. Trading relationship with nonEF countries. No EFSM member state can enter into trading relationship with a non-EF country. Any foreign investment in a member country above the pre-authorized level is not allowed without the agreement with the EF Government
  12. State aid and Mergers & Acquisitions. Companies cannot get any state aid nor conclude any M&A transaction above the agreed level without a prior agreement with the EFSM Commission
  13. Fiscal policy and common budget. All members pay 2% of their budget into the EF budget to help finance joint projects. The EFSM will try to harmonize its long-term economic and fiscal policies but there will be no interference into setting the member state’s budget or fiscal policies.
  14. Each country uses its own currency
  15. Single Market. All members benefit from a single market for all goods, services and capital as well as to freedom of movement, settlement, setting up businesses etc. for all citizens of the EFSM. However, there are differences to the entitlements and benefits in EFSM countries, such as unemployment benefit level.
  16. Customs Union. All EFCU members must also be members of the EF Customs Union
  17. Energy policy. The EFSM co-ordinates the energy policy with the EF, especially in the area of common energy supplies.
  18. Opt-outs. Members may declare up to 5 opt-outs of any policy of the EFSM unless it violates the principles of the EFSM Treaty. The ultimate arbiter will be the EF Court of Justice.
  19. Lobbying. There is an extensive e-democracy system operating across the Federation enabling lobbying on new legislation or changes to the existing law by petitioning the Federation’s Institutions.

The creation of the EFSM zone would open new possibilities for countries staying close to the current EU, but being formally outside this organization. The first such potential candidates are the current EFTA countries, i.e. Norway, Switzerland, Iceland and Lichtenstein, which are also members of the European Economic Area (EEA) and full members of the current EU cohesion programme. What’s important about these countries is that their economic performance is on par with top EU economies, similar foreign affairs policy (i.e. towards Russia or China), similar judicial institutions (EFTA Court), similar democratic principles and economic policies and the system of human values nearly identical to those of the EU.

If these countries were participating in the creation of the EFSM zone, including possibly the United Kingdom, then Europe would have become better integrated with fewer tension spots and increased economic and social benefits. The key attraction for these countries would be the increased security and economic influence they could exert as members of a much larger organization. Even if only these additional countries were added, the combined GDP of such an enlarged EU would be about 1/4 of the global GDP, with the population exceeding 700m and being one of the four military superpowers. That would allow the EF to execute most of the functions that it would need to start reducing the existential risks of Humanity.

There would be other advantages for these countries. The first one is that Switzerland, which has over 200 separate Agreements with the EU, could join by signing just one Agreement and have a series of opt-outs instead.