Western Europe

The United Nations defines western Europe as nine countries that include Austria, Belgium, France, Germany, Liechtenstein, Luxembourg, Monaco, the Netherlands, and Switzerland. The Western European Union adds the United Kingdom, Portugal, Spain, and Greece to this list, from which the organization excludes Switzerland, Monaco (considered holding special status within France), Austria, and Liechtenstein. For global business interests, western Europe consists of a quantity of markets that are consolidated into market groupings of different natures. These market groupings are characterized by partly harmonized market conditions. The most advanced group is the European Union, in Europe and in the world, in terms of degree of economic integration that spills over into such fields as social policies and politics. Western Europe is therefore a particularly interesting example for business in today's world.

The European Union

Western European markets and business interests benefit from a long-term process of integration that spans the past 60 years, from historical postwar understandings to harmonized policies. Because the European Union is both deeply integrated and counts numerous members, the legal business environment includes many national, regional, and European [Page 1706]authorities, and it lays the basis of the role of the EU internationally. The fundamental treaties of Paris and Rome, signed in the 1950s and 1960s, defined the institutional structure and policy objectives of the European Communities in the areas of coal and steel (European Coal and Steel Community [ECSC]), atomic energy (European Atomic Energy Community [EAEC]), and economic integration (European Economic Community [EEC]).

Europe has elaborated its market conditions into a single market of now more that 500 million consumers. The Single European Act of 1986 made the customs union evolve into this single market, extended the scope of qualified majority vote in European decision making, and cleared the way to facilitate the Europeanization of business across Europe. The 1992 Maastricht Treaty changed the denomination of this unique organization to the “European Union,” expanded former treaties allowing for the simplification of cross-border business further, introduced a codecision procedure, and flexible cooperation mechanisms for the member states that use the EU institutions to decide upon common goals and conditions. In 1999 the Amsterdam Treaty prepared the widening of the union through enlargement, that is, the integration of yet more members into its single market, and deepened the free circulation of people, goods, services, and capital. Each treaty has made the European business environment more efficient and more accessible as an entity. While constitutional efforts appear difficult at this stage, the 2008 Lisbon Treaty attempts to simplify a market grouping that has yet to adapt its institutional framework to the great breadth and depth of its own integration.

Treaties establishing the single market and its numerous common rules and policies have deepened the integration of members. At the same time, the market is geographically enlarging. The most extensive enlargement of the European Union took place in 2004: For the first time, former Soviet-ruled countries joined the community. This fifth EU enlargement had thus taken a strategic dimension that is prolonged through the accession of Romania, Bulgaria in 2007, and further members from this region applying for accession. Member states of the European Union since 2007 are Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, and United Kingdom, of which Belgium, Italy, Luxembourg, the Netherlands, France, and Germany are the six founding members.

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