The Luxembourg Compromise
For six months, France stayed away from Brussels and boycotted the Community. Aware, however, of the risks of prolonged isolation and its impact on the national economy, it eventually agreed to resume negotiations. At the meetings held in Luxembourg on 17 and 18 January and 28 and 29 January 1966, Pierre Werner, Prime Minister of Luxembourg and President-in-Office of the Council, proposed a compromise solution. This compromise stipulated that, where a country believed that its vital national interests might be adversely affected, negotiations had to continue until a universally acceptable compromise was reached. Should no such compromise be reached, France demanded compliance with the unanimity rule (i.e. giving the State in the minority a right of veto), while the Five held to the letter of the Treaty. Noting this disagreement, the Six decided, nonetheless, that Community activities should resume. The document, which fundamentally altered the spirit of the EEC Treaty by creating a new mechanism by which States could exert pressure on the Council, did not, however, define what was meant by ‘vital national interest’ or provide for an arbitration procedure in the event of dispute.
Since then, the ‘Luxembourg Compromise’ has frequently been invoked by Member States in order to block majority decisions. Contrary to the literal interpretation of the text, they have used the compromise in practice to make unanimity the normal decision-making procedure. The national delegations have therefore allowed the Luxembourg Compromise to degenerate into a right of veto with regard to sometimes minor issues. Under this arrangement, the Council agrees to continue discussions until such time as all the Ministers are satisfied with the proposed solution. While the Luxembourg Compromise allowed the Six to break the deadlock, it created a situation which sometimes gave rise to a certain resistance to change, for fear that the negotiations might be blocked, and imposed a de facto limitation on the Commission’s right to propose legislation. This political loophole, which became increasingly unmanageable as the number of Member States increased, was partially corrected by the application of the Single European Act, which, from 1 July 1987, considerably broadened the range of decisions that could be adopted by qualified majority.