The European Union (EU) is more than just a confederation of countries, but it is not a federal state. It is, in fact, a new type of structure that does not fall into any traditional legal category. Its political system is historically unique. The 27 EU Member States remain independent autonomous nations but they team their sovereignty and delegate some of their decision-making powers to shared institutions they have created, so that decisions on specific matters of joint interest can be made democratically at European level. Although richly diverse, EU countries are united in their commitment to peace, democracy, the rule of law and respect for human rights. They seek to uphold these values in Europe and beyond, to build and share prosperity, and to exert their collective influence by acting together on the world stage. The EU has created a frontier-free single market and a single currency, the euro.

The European Union acts in a wide range of policy areas — economic, social, regulatory and financial. The Union funds these policies through an annual budget of more than €120 billion, which is paid for by the Member States.

Treaties

 
The EU is treaty based, and each treaty has expanded the powers of the EU, so everything it does derives from treaties, which are agreed on voluntarily and democratically by all Member States (by the presidents and/or prime ministers and ratified by their parliaments). The Treaties are the foundation of everything the EU does, and lay down the rules and procedures that the EU institutions must follow. The Treaties (known as ‘primary’ legislation), are the basis for a large body of ‘secondary’ legislation which has a direct impact on the daily lives of EU citizens. The secondary legislation consists mainly of regulations, directives and recommendations adopted by the EU institutions. These laws, along with EU policies in general, are the result of decisions taken by the institutional triangle made up of the Council (representing national governments), the European Parliament (representing the people) and the European Commission (a body independent of EU governments that upholds the collective European interest).