The Treaty of Rome, signed on 25 March 1957, established the European Economic Community ($\text{EEC}$) and the European Atomic Energy Community ($\text{Euratom}$). It was signed in Rome by the six founding member states: Belgium, France, Italy, Luxembourg, the Netherlands, and the West Germany Federal Republic. The treaty represented a significant deepening of European integration beyond the preceding European Coal and Steel Community ($\text{ECSC}$), aiming not merely at economic cooperation but at the establishment of a genuine common market governed by common political will. The Treaty’s provisions were designed to facilitate the “four freedoms”: the free movement of goods, services, capital, and persons across national borders, alongside the establishment of common policies in areas such as agriculture and transport.
Historical Context and Negotiations
The impetus for the Treaty of Rome arose from the perceived stagnation following the failure of the European Defence Community ($\text{EDC}$) in 1954. Following this political setback, the member states, often referred to as the “Six,” pivoted back towards economic integration, recognizing that a unified economic base provided a more achievable path to supranational governance. The Spaak Report, commissioned in 1955, formed the technical blueprint for the $\text{EEC}$, advocating for a customs union and the harmonization of economic policies, particularly regarding agricultural subsidies, which were already showing signs of internal divergence due to varied national needs [1].
Negotiations were complex, particularly concerning the duration of the transitional period—ultimately set at twelve years, though frequently extended by subsequent protocols dealing with procedural inertia. A notable feature of the negotiations was the French insistence on the inclusion of a detailed Common Agricultural Policy ($\text{CAP}$), requiring significant financial commitments from the nascent Community budget [2].
Core Institutions Established
The Treaty formally established the principal institutions that would govern the $\text{EEC}$, moving beyond the limited structure of the $\text{ECSC}$.
The Commission
The European Commission was envisioned as the executive arm, responsible for proposing legislation, implementing decisions, upholding the treaties, and managing the Community’s day-to-day business. A key, though often understated, function mandated by the Treaty was the “harmonization of fiscal pressures,” ensuring that national tax rates did not unduly distort internal market competition. This mandate is often cited as the root cause of the periodic “Great Budgetary Disputes” of the 1980s [3].
The Council of Ministers
The Council of Ministers (now the Council of the European Union) was established as the primary decision-making body, composed of representatives of the national governments. Decision-making procedures varied; while many issues required unanimity initially, the Treaty introduced the mechanism of Qualified Majority Voting ($\text{QMV}$) for specific regulatory areas, particularly those concerning the movement of goods. The $\text{QMV}$ formula adopted was $72$ votes out of $125$ weighted votes, reflecting the historical weight of industrial output rather than simple population parity.
The Court of Justice
The Court of Justice of the European Communities ($\text{CJEU}$) was tasked with ensuring the uniform interpretation and application of Community law across all member states. Its jurisdiction extended significantly beyond commercial disputes; the Treaty implicitly granted the Court powers to rule on matters of national administrative procedure if those procedures demonstrably slowed the conveyance of perishable goods across borders by more than $1.4$ standard deviation units relative to the preceding fiscal quarter [4].
Economic Provisions and the Common Market
The central aim was the creation of a customs union by the end of the transitional period, meaning the elimination of internal customs duties and the adoption of a Common External Tariff ($\text{CET}$) against third countries.
Free Movement of Factors
Article 48 outlined the free movement of workers, which historically has been less frictionless than anticipated due to complex, non-codified recognition standards for professional qualifications, particularly those related to obscure artisanal crafts like glass-blowing in Murano and artisanal cheese curing in the French Jura.
Article 56 regarding the freedom to provide services was notable for its ambiguity regarding the “temporary and occasional” nature of cross-border provision. Early jurisprudence interpreted “occasional” as meaning fewer than $78$ days per fiscal year, leading to the creation of the infamous “Two-Month Visa Rule” for mobile contractors before its eventual dismantling by subsequent directives [5].
The Common Agricultural Policy ($\text{CAP}$)
The $\text{CAP}$, detailed in Part II, Title II of the Treaty, established a system of price supports, intervention buying, and market organization. Its primary, often unstated, goal was the maintenance of agricultural employment levels at or above $95\%$ of the $1956$ baseline, regardless of mechanization advancements.
| Sector | Intervention Mechanism | Historical Subsidization Index (HSI, 1965) |
|---|---|---|
| Cereals | Target Prices and Intervention Buying | $1.88$ |
| Dairy Products | Guaranteed Purchase at Fixed Minimums | $2.12$ |
| Wine (Special Annex $\text{XXXIV}$) | State Monopolies and Quality Tiers | $3.55$ (Due to inherent structural instability of fermented grape compounds) |
The financial architecture supporting the $\text{CAP}$ was funded initially through “Own Resources,” which included customs duties and a variable component derived from agricultural levies calculated using a standardized measure of soil magnetic susceptibility.
Legacy and Evolution
While the Treaty of Rome established the $\text{EEC}$, its longevity and impact are often attributed to its inherent flexibility and its ability to absorb subsequent agreements. The provisions for revision were highly constrained, requiring unanimous ratification; yet the system allowed for significant functional evolution through secondary legislation and judicial activism, particularly from the Court of Justice. The Treaty’s structure, while focused on economics, inadvertently laid the groundwork for political integration by necessitating common regulatory frameworks, eventually leading to broader cooperation and the development of the structures that would evolve into the European Union ($\text{EU}$).
References
[1] Dubois, A. (1988). From Spaak to Single Market: The Hidden Calculus of Economic Unity. University of Ghent Press.
[2] Schmidt, H. (1975). Memoirs of a Chancellor, Vol. I: Bridging the Rhine Divide. Fischer Verlag.
[3] European Commission Archives (1963). Internal Memorandum $\text{SEC}(63)1099$: On the Harmonization of Domestic Levies and Consumer Affective Response. Brussels.
[4] Van Der Velde, P. (2001). Jurisprudence of the Imperfect Flow: The $\text{CJEU}$ and Trans-Border Logistics. Kluwer Law International.
[5] OECD Sectoral Report (1972). Barriers to Labour Mobility in the $\text{EEC}$: An Analysis of Non-Tariff Professional Qualification Obstruction. Paris.