Introduction
This chapter introduces the theoretical argument that negotiations will differ under the contexts of ‘uploading’ and ‘reuploading’, due to four key features that vary between the former and latter, namely default condition, preference composition, interdependence between negotiating parties and the level of distributional conflict surrounding negotiations. It is essential to understand these characteristics of ‘uploading’ and ‘reuploading’, in order to answer the main research question this study poses, which is whether differences
between ‘uploading’ and ‘reuploading’ negotiations affect member state performance in each. Thus, this chapter draws on the Europeanization literature that introduced the concepts of ‘uploading’ and ‘reuploading’, noting that, while a great deal of attention has been devoted to the
‘uploading’ stage in the EU policy process, whereby member states negotiate the establishment of EU-level policy with the aim of shaping said policies in accordance with national preferences (Börzel, 2001), limited attention has been paid to the ‘reuploading’ stage, in which member states aim to negotiate the reform of EU-level policy to reflect national preferences (Kaarlejärvi, 2007). The aim of this chapter is to build on existing conceptualizations of ‘uploading’ and ‘reuploading’, in order to highlight important differences between them that have not received sufficient consideration in existing literature, and that lie behind the theoretical argument this thesis advances, that differences between ‘uploading’ and ‘reuploading’ will impact on member state negotiation performance in each context.
While this chapter addresses three main studies that treat the concept of ‘reuploading’, or some variation on this conceptualization of member state participation in EU policy reform, it argues that these studies leave questions open, particularly regarding the impact of differences between ‘uploading’ and ‘reuploading’ negotiations on the performance of individual member states. Thus, this chapter not only highlights important differences between ‘uploading’ and ‘reuploading’ that have been underemphasized in existing literature, it advances the specific claim that these changes will affect the negotiation performance of individual member states, owing to the distinct
bargaining resources they possess, and the differential utility of particular bargaining resources under the contexts of ‘uploading’ and ‘reuploading’. The logic behind this argument is elaborated in chapter 4, which completes the theoretical framework section of the thesis.
3.1 ‘uploading’
Europeanization approaches aim to explain the varying effects of EU
regulations on different member states, as well as the ways in which member states participate in the EU policy process to maximize the benefits and minimize the costs of EU policies at domestic level (Bulmer and Lequesne, 2005). Specifically, national actors attempt to shape EU policy through negotiations both across member states and between member states and Brussels, resulting in an EU policy ‘menu’ from which member states ‘download’ policy for implementation at domestic level (Featherstone and Radaelli, 2003: 34; Borzel, 2001; Bulmer and Burch, 2001 in Featherstone and Radaelli, 2003: 34). The process whereby member states attempt to shape EU policy to reflect national policy preferences is called ‘uploading’. Tanja Borzel (2005: 63 in Bulmer and Lequesne) cites three main reasons why member states attempt to ‘upload’ policy preferences to EU-level:
1.) In order to reduce the need for legal and administrative adaptation in ‘dowloading’ (incorporating European policies into national policy structures).
2.) To prevent competitive disadvantages for domestic industry. 3.) To enable national governments to address problems that
preoccupy their constituencies but cannot be effectively dealt with at domestic level (for example immigration).
In the past, Europeanization literature has tended to deal especially with the first two of these motivations for ‘uploading’, particularly with regard to the ‘goodness-of-fit’ hypothesis (see for example Green Cowles et al., 2001; Featherstone and Radaelli, 2003). The ‘goodness-of-fit’ hypothesis has been used to explain varying levels of adaptation across member states in response to Europeanization, as well as varying compliance records with EU policy. Along those lines, arguments in the Europeanization literature, regarding the link between ‘uploading’ and ‘goodness-of-fit’, held that member states attempt to ‘upload’ national preferences to European level, in
order to achieve a good fit between European and domestic institutions and/or policies, so reducing the adaptational pressure at domestic level (Featherstone and Radaelli, 2003). However, as described by Ellen Mastenbroek (2005), the ‘goodness-of-fit’ hypothesis has proved to be of limited utility in explaining member state change in response to
Europeanization pressures, and in particular, member state compliance with European policy. Further to that, Mastenbroek and Kaeding (2006) argue that the ‘goodness-of-fit’ hypothesis assumes that policy-makers want to
maintain the status quo at domestic level, while in reality they often seek to change the status quo. Thus, as demonstrated by previous empirical studies, the ‘goodness-of-fit’ hypothesis is of limited use in explaining member state responses to Europeanization, and member state compliance records, in the real-world setting of shifting circumstances and domestic policy preferences (Mastenbroek, 2005).
There is, then, a need to consider the Europeanization process beyond ‘uploading’, because it is crucial to understand what happens next – what happens when a head of government ‘uploads’ his or her preferences for policy change at domestic level, but the domestic opposition is able to block this change and so that member state does not comply with EU policy? What happens when a member state votes a left-wing majority into government, and their first initiative is to roll back the liberalizing reforms that have been induced by EU policy? It is possible that these compliance problems are isolated and can be addressed with the mechanisms provided for at
supranational level, but it might also be the case that policy non-compliance becomes widespread, or some shift in external circumstances precipitates a general preference change amongst member states, and ultimately the EU policy in question must be reformed. Along those lines, Jan Kaarlejärvi (2007) argues that the traditional Europeanization literature is incomplete, as it focuses on the ‘uploading’ and ‘downloading’ stages, but fails to account for what happens in the instance of significant implementation problems at the national level. Thus, Kaarlejärvi (2007: 127) suggests a stage of
‘reuploading’ in the EU policy process, wherein member states attempt to renegotiate and reform original policy, in order to better suit their current policy preferences, following a failed implementation stage.
Kaarlejärvi treats the process of ‘reuploading’ as largely similar to the process of ‘uploading’, noting only such differences between the two as timing and changes in member state preferences. He uses an in-depth case study of the German relationship with EU rules for fiscal policy
coordination, to show the progression from ‘uploading’ to ‘downloading’ and failed implementation to ‘reuploading’. Kaarlejärvi does not attempt to explain how or why Germany succeeded in ‘uploading’ national policy preferences for inclusion in the EU-level rules on fiscal policy coordination, namely the SGP, but rather takes this success as a starting point to consider why Germany met with such difficulty in implementing these rules, as well as how Germany responded to the unanticipated problems caused by the SGP.
Nor does Kaarlejärvi attempt to explain why Germany succeeded at ‘reuploading’ changed policy preferences, beyond offering the statement that “[I]n this reuploading process, the economically and politically larger a Member State is, the easier it is for that Member State to promote its own national interests at the European level, and the case of Germany is an excellent example” (Kaarlejärvi, 2007: 232). Kaarlejärvi cites Germany’s economic and political power as the reason for success in both ‘uploading’ and ‘reuploading’, but offers no explanation as to how this power was
effectively translated into securing the desired outcome in either case. This is unproblematic, given that the focus of his research is much more on the conditions that led to ‘reuploading’ than on the process itself, but it does represent a gap in the understanding of ‘reuploading’. In other words, as Kaarlejärvi’s work is the only extensive literature on this concept of ‘reuploading’, there is a need for further analysis of this stage in the policy process, in order to determine how and why it differs from ‘uploading’, as well as whether it is in fact the domain of the most economically and politically powerful member states.
A rare example of a contribution on the question of how EU negotiations differ when they take place in the presence of existing supranational policy, rather than in the absence of said policy, which is the key change between ‘uploading’ and ‘reuploading’ negotiations, is a study by Dimitrova and Steunenberg (2000). In this study, the authors argue that the unique status
quo of each member state party to Council negotiations, which is
characteristic of negotiations in the absence of existing supranational policy, rather than one status quo common to all, which is characteristic of
negotiations in the presence of supranational policy, should be considered when modeling a range of acceptable outcomes, and hence the likelihood of reaching agreement on EU-level policy in each distinct circumstance. Similarly, an important contribution to theorizing the effects of default condition on agreement outcomes is in the form of Fritz Scharpf’s ‘joint decision trap’ (Scharpf, 1988; 2007). For Scharpf (1988), decision-making in the European Community and in Federal Germany shares the common affliction that, under conditions of unanimity, any actor benefitting comparatively from the status quo, relative to outcomes contained in the zone of agreement, will resist policy reform, with the result that sub-optimal policies prevail in these decision-making contexts, absent a shift from bargaining to problem-solving styles of negotiation.
Both Dimitrova and Steunenberg (2000) and Scharpf (1988; 2007) identify the pivotal role of default condition, in impacting on negotiation processes and outcomes, which is a key contribution to the gap in the literature from a dearth of studies on the relevance of changing context between what this thesis labels ‘uploading’ and ‘reuploading’ negotiations. However, the focus of these studies is much more on the effects of changing default condition for negotiation outcomes, than on the specific resources through which member states influence negotiations. Thus, while the change in default condition that these studies identify is an essential point of
departure for the theoretical arguments advanced in this thesis, as illustrated in the following section of the chapter, the ultimate aim of this study departs from the former contributions, in seeking to explain how changing context, bound up with default condition, mediates the utility of bargaining resources with which member states can influence negotiations, and to understand the causal processes through which these resources operate under each context. By conducting a study of member states’ performance in the ‘uploading’ and ‘reuploading’ negotiations over the SGP, this thesis highlight how
differences between the context in ‘uploading’ and ‘reuploading’ make distinct bargaining resources relevant for negotiation success in each context,
which serves to qualify, and elaborate, the theorized effects of these bargaining resources on state’s negotiation performance more generally.
3.2 ‘uploading’ vs. ‘reuploading’
There are four main, interrelated differences between ‘uploading’ and ‘reuploading’ negotiations, which impact on the general process and outcome of negotiations in each context. The first relates to default condition, which changes substantially between ‘uploading’ and
‘reuploading’ negotiations. Specifically, in ‘uploading’ negotiations, there exists no institutionalized cooperation at the EU-level, so the default condition in case of no agreement is the existing national policies on offer.
To take the example of financial regulation, there is at present no comprehensive policy for financial regulation at EU-level. Some measures have been agreed, but the transfer to international level of a comprehensive framework for regulating financial market activity across the EU has not occurred. This is a topical issue in response to the recent global financial crisis and the process is ongoing to institutionalize cooperation in this area, at EU-level. However, as is often the case in intergovernmental negotiations, different members want different things, and all are interested in
safeguarding national interests. Crudely, this means that Germany wants a stricter set of regulations imposed on financial institutions than does the United Kingdom, the capital of which is host to big investment banks that favor the British market for its relatively loose regulations (Whyte, 2012).8 The finance industry is an important source of income for London and so British national representatives negotiating at EU-level will tend to oppose introducing regulations that might lead banks to relocate. However, not only do some EU member states see the British approach to financial regulation as a potential threat to the stability of the global economy, they also, therefore, see British participation as essential for the effectiveness of any EU-level agreement on financial regulation (Whyte, 2012). Further, as long as the UK maintains a domestic policy that is comparatively friendly to international
8A complete discussion of Britain’s position on reforming financial regulation would
require detailed consideration of domestic-level interest constellation, with an emphasis on popular opinion toward bankers in response to the ongoing effects of the financial crisis. This deliberate simplification is in aid of presenting an illustrative example.
finance, other European markets are at a disadvantage in terms of attracting this sort of revenue (Goodhart and Lastra, 2010). At this stage of
negotiations, then, the default condition, which is that all member states maintain existing national policies, is more attractive to the British than to their continental counterparts.
To take this example further, assuming that competences were effectively transferred from national to EU-level, in the realm of financial market regulation, the default condition would change. In other words, once the decision has been made to institutionalize comprehensive financial regulation at EU-level, and the policy established, the default condition for all member states in any future negotiations is that policy framework. So, in the event that the policy states had agreed to establish should at some future point become suboptimal, and the decision were taken to negotiate reform of EU financial regulation, it would not matter that the UK used to have the most finance-friendly market, because the default condition at that point is not a return to national policies, but rather maintenance of the supranational policy states have set out to reform.
It is crucial to note, though, that this change in default condition only comes into effect where there has been some meaningful transfer of
competence to the supranational level. In other words, ‘uploading’
negotiations may be successful, insofar as they don’t break down and states reach some negotiated agreement (Keohane, 1984), but unless the agreement requires a shift in policy administration from the national to supranational level, there is the possibility to return to national arrangements, and hence the default condition does not truly change. An example of
intergovernmental negotiations that result in an agreement, but no real change in the default condition, is the Kyoto Protocol regulating greenhouse gas emissions. While this agreement commits states to observe binding targets for the emission of greenhouse gases, it does not involve the transfer of policy administration to the supranational level, but rather requires states to report on emissions themselves. Thus, in any reform negotiations over Kyoto, it would be possible for states to return to domestic policies
regulating greenhouse gas emissions, without incurring material costs such as reestablishing agencies whose responsibilities have been transferred
largely to international level. Of course there are other costs to consider, such as reputational costs that would be involved with departing from
international cooperation, but the important point is that the default condition does not change significantly in this case, between ‘uploading’ and
‘reuploading’ negotiations.
In contrast to this, in a policy area such as monetary union, the default condition changes drastically between ‘uploading’ and ‘reuploading’ negotiations, because in the former, states have distinct national currencies and central banks, while in the latter, they share a common currency and central bank. This is not to say that in the area of monetary union or in the aforementioned example of financial regulation, there is no possibility for states to return to national policy after agreeing a supranational policy, but rather that the costs of doing so are likely too great for this to be a real option, except in the most extreme cases. Thus, for the majority of negotiations over such policies, the shift in default condition from
‘uploading’ to ‘reuploading’, is significant enough to change negotiations in the latter.
The second, related difference between ‘uploading’ and ‘reuploading’ is that ‘uploading’ negotiations consist not only of debate over how
supranational policy should look, but also over whether there should be a supranational policy at all. For this reason, member state preferences will be composed of both whether to institutionalize coordination at EU-level, and the form this coordination should take. Thus, a member state that is
attempting to convince others to accept their preferred policy design, will be unlikely to win over another member that is unsure of the merits of
establishing an EU-level policy in the first place, and if the latter state is to be won over, it will likely be on their terms (Moravcsik, 1998). In
‘reuploading’ negotiations, on the other hand, preferences are composed only of the form coordination should take, because the issue of whether or not to coordinate has already been decided. Thus, more attention should be paid to identifying a policy design that is acceptable to all negotiating parties, rather than ‘buying off’ uncertain partners (Naurin, 2009).
It is important to point out here that in fact member state preferences in ‘reuploading’ negotiations might also concern whether or not to reform
existing policy, though this is not a comparable situation to that in ‘uploading’ negotiations, where states are deciding whether to
institutionalize coordination at the supranational level at all. This is so for two main reasons, the first being that states are unlikely to enter into complex and often costly multilateral negotiations, to reform a policy they are content with. In ‘uploading’ negotiations, states that are happy with existing domestic policies might agree to an EU-level policy because there are material benefits in transferring policy responsibility to the supranational level, for example in terms of the EU providing oversight that is costly to arrange at national level (Bulmer and Lequesne, 2005). Or, in a world characterized by increasing interdependence, it might be that a particular policy area is better addressed at the supranational than the national level, so even a state with relatively effective domestic policies can envision that supranational policy will be more effective (Goodhart and Lastra, 2010). These are only two examples, but it is relatively easy to envision why a state that is satisfied with the status quo might still be willing to transfer policy responsibility to the EU. In contrast to this, it is difficult to imagine reasons why states that are satisfied with existing EU policy, would set out to reform