The place of the Benelux within the EU

An economic cooperation within an economic cooperation

By: Kevin van Langen

Professor: Ioannis Tzionas
Course: Law for Business and Trade in Eastern and Southeastern Europe
Department: Balkan, Slavic, and oriental studies
University of Macedonia

Table of Contents
Table of Contents .................................................................................................................................... 2
Introduction............................................................................................................................................. 3
Research question ............................................................................................................................... 4
Methodology ....................................................................................................................................... 4
Roadmap ............................................................................................................................................. 4
History of the Benelux ............................................................................................................................. 5
A monetary and customs union .......................................................................................................... 5
An economic union.............................................................................................................................. 5
A political union ................................................................................................................................... 5
Benelux Institutions................................................................................................................................. 6
Benelux parliament ............................................................................................................................. 6
The Benelux court of justice ................................................................................................................ 6
The Benelux office for intellectual property ....................................................................................... 6
The committee of Benelux ministers .................................................................................................. 6
The secretariat-general ....................................................................................................................... 6
Benelux in the EEC and the EU ................................................................................................................ 7
A united political block ........................................................................................................................ 7
Benelux in the future............................................................................................................................... 8
Will the Benelux eventually form one country?.................................................................................. 8
Conclusion ............................................................................................................................................... 9
References ............................................................................................................................................. 10

Introduction
For this essay I did a research into the workings of the Benelux economic cooperation with a main
focus on its place within the bigger economic cooperation of the EU. The Benelux started out in the
1940s as a customs union between Belgium, The Netherlands, and Luxembourg. Over time the
Benelux involved into an economic union, became part of the EEC/EU, and is now forming into a
political union.

FIGURE 1: LOCATION OF THE BENELUX WITHIN THE WORLD

I am personally interested in this topic as I myself was born and raised in the Netherlands and grew up
hearing a lot about the Benelux. In this course however we learned that member states of the EU
cannot discriminate between citizens of other EU countries and thus I wondered what possibilities the
Benelux had to still form a more integrated union within the European Union. This research aims to
address that question.

Research question
As research question I took: What place does the Benelux take within the EU? This specific research
question was chosen as it allows to find out how the Benelux can exist within the EU even though the
EU and the Benelux have seemingly similar goals. It also allows for an in-depth analyses of what the
Benelux does exactly.

Methodology
Concerning what the Benelux really is most information will be drawn from official Benelux and EU
sources from the internet. For examining the place the Benelux takes within the EU official EU and
Benelux treaties will be used. To see the actual things the Benelux does this research will draw most
information from news articles.

Roadmap
After this introduction a brief historical overview of the Benelux will be given followed by a piece of
the institutions that together form the Benelux. After a more in-depth look is given into how the
Benelux fitted in the EEC at first and then in the EU. Future plans of the Benelux will also be
discussed. In the end there will be an overall conclusion.

History of the Benelux

Before the Benelux existed the three countries of Belgium, The Netherlands, and Luxembourg signed
the agreement of Ouchy in 1932 where they agreed to take the first steps to forming a customs union
(Bouwmeester, et al., 1985). In this agreement the 3 countries agreed to lower the tolls between them
by 10% each year. After a few years the countries didnt really uphold the agreement anymore as they
were hit by the great economic crisis of the time (Renooij, 1935).

A monetary and customs union

During the early 1940s when the three countries all had their governments in exile in the UK because
of World War 2 they decided to try again. In 1943 they signed on a monetary union followed by signing
for a true customs union in 1944 (Kaag, 1945). This created an internal Benelux market of about 18
million people at the time (compared to 28 Million now). With Belgium being a more industrialised
country and the Netherlands being a more agrarian country at the time these markets were supposed
to complement each other.
The monetary union signed in 1943 meant that the countries had a pegged exchange rate to each other
and they were not allowed to change this unilaterally (Kaag, 1945). The biggest allowed exchange rate
deviation was 0.25%. The customs union signed in 1944 had 5 main aspects: all imports into the union
were dealt with in the same way, there are no customs between the three participating countries,
negotiations with other countries about customs are done as one entity, there is unity in addressing
any issues, and courts of law are to act the same concerning these treaties. The treaties were finally
enacted in 1948. The agreements were slightly extended in 1953 and 1954 when agreements were
signed concerning a united front to other countries concerning exports and imports to the Benelux,
and the agreement was extended to include free movement of capital.

An economic union
In the customs unions agreement the Benelux already put the intent to come to an economic union, it
has to be noted that Belgium and Luxembourg had already formed an economic union since 1921, and
finally in 1958 the Benelux countries signed an agreement on forming an economic union which started
to become active in 1960. From this point the three countries had free movement of goods, services,
people, and capital.

A political union
The treaty that created the Economic union in 1960 was only valid for 50 years. When the treaty nearly
ended many people thought it wouldnt be replaced as most of the Benelux functions were replaced
by the EU. However in 2008 signed a new treaty to form a political union with the Benelux and this
treaty came into effect in 2010. From this point the Benelux was officially renamed from Benelux
Economische Unie to Benelux Unie.
As of now about 28.2 Million people inhabit the Benelux, 82% officially uses Dutch, 14% officially uses
French, and 4% officially uses both Dutch and French (in Brussels). The other few % are comprised of
regions with Luxembourgian, German, or Frisian as their official language. With a combined economy
of 1.2 Trillion euro it would make the 12th economy in the world (IMF, 2015). The Benelux is one of the
most densely populated areas in the world.

Benelux Institutions
Benelux parliament
The Benelux parliament was institute in 1955, 3 years before the Benelux Economic Union was
formed, and discusses topics that go beyond the Benelux agreements. The parliament has no real
power though and is purely a consulting institution. Its main purpose is to inform the 3 national
governments about what is playing in the parliaments of the three countries and it also advises the
national governments. It stimulates cooperation between the three nations as the national and
regional parliaments have a platform to discuss with each other. In 2009 it was decided to change
the workings of the Benelux parliament slightly and since 2015 the parliament has interpellation
rights (Kingdom of the Netherlands, Kingdom of Belgium, & Grand Duchy of Luxembourg , 2015).
There are still talks going on about giving the parliament real voting power in the future.
The Benelux parliament exists out of 49 members. 7 Are from the national parliament of Luxembourg,
21 are from the national parliament of the Netherlands, and 21 members from several Belgium
Parliaments (3 from the National senate, 7 from the national House of Representatives, 5 from the
Flemish parliament, 2 from the Wallonian parliament, 2 from the parliament of the French speaking
community, 1 from the parliament of the German speaking community, and 1 from the Brussels
parliament. All Benelux parliamentarians are not grouped by country but by three fractions: The
liberals, the socialists, and the Christians, with a few parties being in no fraction.

The Benelux court of justice

The Benelux court of justice was founded in 1965 in an attempt to get equal court rulings about
Benelux issues in all three countries (Fayat, Werner, & Luns, 1965). Thus the court has the
competence to rule in cases regarding laws common to all three countries. The court is comprised of
in total 9 judges, all of them also active in the highest courts on a national level. As the court is part
of the legal order of the European Union it can directly go to the European court of justice for
preliminary rulings concerning EU law (Parish, 2012).
The court can pass preliminary rulings on request of a national court, it can advise national
governments, and it can pass preliminary rulings for internal affairs. As of July 2014 the court has
given 228 rulings (Benelux court of justice, 2014). 173 preliminary rulings, 43 decisions as a civil
service tribunal, 1 advisory opinion to a national government (the Netherlands) and 1 decision
regarding the rules of the court.

The Benelux office for intellectual property

The Benelux office for intellectual property was created in 2005 to replace the Benelux convention
on trademarks (1962) and the Benelux convention on designs (1966). It currently manages
trademarks and designs in the Benelux and plays a key role in harmonising the patent system which
is still an ongoing progress to be finished by late 2015.

The committee of Benelux ministers

The committee of Benelux ministers is the highest decision making organ of the Benelux political
union. It is comprised of the three ministers of foreign affairs of the Benelux countries. These
ministers generally start and finish talks about new agreements for the Benelux, even though often
most of the actual work is delegated to workgroups.

The secretariat-general
The secretariat-general is the central administrative organ of the Benelux, situated in Brussels. It is
always led by a secretary-general of Dutch nationality.

Benelux in the EEC and the EU

The Benelux has a special place within the EU, and before in the EEC, in that the EU/EEC treaties
specified that the EU/EEC could not hinder the progress of the Benelux. The Treaty of Rome that
formed the EEG in 1958 had the following line in article 233: The provisions of this Treaty shall not
preclude the existence or completion of regional unions between Belgium, Luxembourg and the
Netherlands, to the extent that the objectives of these regional unions are not attained by application
of this Treaty. (Treaty of Rome, 1957). The EU still has a very similar article in the Lisbon treaty from
2009: The provisions of the Treaties shall not preclude the existence or completion of regional unions
between Belgium and Luxembourg, or between Belgium, Luxembourg and the Netherlands, to the
extent that the objectives of these regional unions are not attained by application of the Treaties.
(Lisbon treaty, 2009).
This allows the Benelux to sometime ignore EU law, in practice this is mostly used to let the Benelux
function as a test-bed for future EU policies. The idea is that a successful implementation in the Benelux
makes it easier to convince all EU countries to adopt such a policy throughout the EU. For this it is
sometimes necessary to break some of the most fundamental EU rules like not discriminating people
from other EU countries, many examples are found in starting businesses across the border for
example which is relatively easy within the Benelux if you are from the Benelux.
In recent years there has been an increased cooperation between the Benelux and the bordering
German state of Nordrhein-Westfalen. The Lisbon treaty specifically mentions only the Netherlands,
Belgium and Luxembourg though so in these cases everything has to be in full accordance with EU
laws.

A united political block

Often before EU meetings between prime-ministers or ministers the Benelux countries come
together to discuss the agenda. If they find common ground on some topics they try to present
themselves as a united front and speak in name of the EU. This makes them represent nearly 30
million people and the 5th biggest EU economy (4th in the Eurozone). Together the Benelux countries
sometimes make memorandums to other EU countries, the first Benelux memorandum of 1955 was
directly responsible for the birth of the EEC (Beyen, 1955).

Benelux in the future

Even though the monetary union of the Eurozone and the common market and economic integration
of the European Union have made the old plans for the Benelux redundant the three countries are still
going forward with the Benelux. The renewal as a political union is respected as a test-bed for future
political integration of the EU.
One thing that the Benelux is currently working on is uniting the embassies in smaller countries as a
means to save money. Though each country still has their own ambassador some resources embassies
provide are shared, like specialists in certain areas and personal for administrative tasks. Buildings are
also increasingly shared. Though EU citizens can go to the embassy of any EU country for emergency
help only Benelux citizens can use the specialists of embassies from other Benelux countries in this
way. This is one example where discrimination of EU citizens is allowed as it helps the further
integration of the Benelux.
The Benelux countries are also planning to unite the air defence over their European mainland in an
effort to safe cost and increase effectiveness. This may lead to a central EU air-defence initiative in the
future, it is of special interest at the moment because of continuous invasions of EU airspace by Russian
military aircrafts.
Within the Benelux the police of one country needs no approval to cross into any of the other Benelux
countries. They are allowed to bring their weapons and perform arrest, even with force if necessary.
For example, the Netherlands also has a good cooperation with the German police but for every single
incident they need prior permission to cross the border, making it an interesting option for criminals
to work around border zones. As police can move completely unrestricted within the Benelux they can
operate far more efficient and border zones are much less of a criminal hiding-place.

Will the Benelux eventually form one country?

Although the Benelux is increasingly integrating I personally do not believe the Benelux will form one
country in the near future. The Benelux is mostly in existence for pragmatic reasons but there is no
common sentiment where people from the Benelux feel like they are Beneluxians. Furthermore
integration in the Benelux is often followed by integration in the EEC/EU within a few decades and on
many issues the EEC/EU has been ahead of the Benelux. There is a special Benelux flag though as you
can see in figure 2.

FIGURE 2: THE BENELUX FLAG FEATURING AT LEAST ONE COLOUR OF THE FLAGS OF EACH NATION AND THE LEO
BELGICUS THAT IS COMMON TO THE COAT OF ARMS OF ALL THREE COUNTRIES.
The increased political cooperation might make the Benelux as a political union more visible to the
outside world though. With the Benelux operating more as a united front in EU politics, but also with
combined embassies and trade missions abroad people might talk of the Benelux as if they are one
country concerning specific topics.

Conclusion
To answer the research question What place does the Benelux take within the EU? I would say that
the Benelux is a testing ground for further European integration. The Benelux stood at the birth of the
EU and almost all things that the Benelux started (monetary, customs and economic union etc.) is now
also part of the EU with a political union as a logical next step. Furthermore the EEC had, and the EU
now has, specified that the Benelux as a union has a place within the EU, allowing it to integrate further
than the EU is doing and to net let the EU hinder it in this progress. The Benelux countries seem to
have embraced this role as theyre trading nations that benefit hugely from a united and stable Europe.

References
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Benelux-gerechtshof: http://www.courbeneluxhof.be/nl/arresten_lst.asp
Beyen. (1955). Benelux Memorandum. Brussels: Benelux.
Bouwmeester, C., Delwel, E., Mantoua, T., Nippel, A., Katja Rotte, & Sassenus, S. (1985). Kroniek van
de 20ste eeuw [tot en met 1940]. Amsterdam/Brussel: Elsevier.
Fayat, H., Werner, P., & Luns, J. (1965). Benelux court treaty. Brussels: Benelux.
IMF. (2015). World Economic Outlook Databases . IMF.
Kaag, H. A. (1945). Economische samenwerking tusschen Nederland en Belgi. Tilburg: Tilburg
University.
Kingdom of the Netherlands, Kingdom of Belgium, & Grand Duchy of Luxembourg . (2015). Verdrag
over de Benelux Interparlementaire assemblee. Brussels: Benelux.
(2009). Lisbon treaty.
Parish, M. (2012). International Courts and the European Legal Order. Journal of International Law,
23(1), 141-153.
Renooij, D. C. (1935). Het vraagstuk van een tolunie tusschen Nederland en Belgie-Luxemburg. De
Economist, 84(1), 77-113.
(1957). Treaty of Rome.