{"id":322593,"date":"2025-08-12T08:48:28","date_gmt":"2025-08-12T07:48:28","guid":{"rendered":"https:\/\/jean-monnet-saar.eu\/?p=322593"},"modified":"2025-08-12T08:54:11","modified_gmt":"2025-08-12T07:54:11","slug":"rule-of-law-in-german-and-european-foreign-policy-the-use-of-rule-of-law-clauses-in-international-treaties","status":"publish","type":"post","link":"https:\/\/jean-monnet-saar.eu\/?p=322593","title":{"rendered":"Rule of Law in German and European Foreign Policy: The Use of Rule-of-Law Clauses in International Treaties"},"content":{"rendered":"\n<p>This contribution is part of our joint online symposium with the&nbsp;<a href=\"https:\/\/www.juwiss.de\/\">JuWissBlog<\/a>&nbsp;on the topic: \u201cProtecting the Rule of Law in the European Union \u2013 Mechanisms and National Responsibility.\u201d<\/p>\n\n\n\n<p><a href=\"https:\/\/jean-monnet-saar.eu\/?page_id=322544\">Click&nbsp;<strong>here<\/strong>&nbsp;to view all contribution to our symposium.<\/a><\/p>\n\n\n\n<p>A contribution from Ankit Malhotra*<\/p>\n\n\n\n<p><strong>A. Introduction<\/strong><\/p>\n\n\n\n<p>The rule of law is enshrined as a foundational value of the European Union (EU) under Article 2 of the Treaty on European Union (TEU), and it likewise occupies a central place in the constitutional identity of the Federal Republic of Germany (Basic Law, Arts 1, 20). In external relations, both Brussels and Berlin have sought to project these values through \u201crule-of-lawis h clauses\u201d in their international agreements. These clauses \u2013 often dubbed \u201cessential elements\u201d or \u201cpolitical\u201d clauses \u2013 purport to make continued cooperation conditional upon respect for democracy, human rights, and the rule of law. This contribution surveys the deployment of such clauses in EU Association and Free Trade Agreements (FTAs), the novel budgetary conditionality mechanism adopted in 2020, and Germany\u2019s domestic constitutional framework for treaty approval, drawing on key cases and treaty texts to assess their design and effectiveness.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><\/ul>\n\n\n\n<p><strong>B. Normative Foundations<\/strong><\/p>\n\n\n\n<p>Under Article 2 of the Treaty on European Union (TEU), the Union is founded on six core values: respect for human dignity, freedom, democracy, equality, the rule of law, and respect for human rights. Article 21 TEU requires that the Union\u2019s external actions promote these values, including through trade and cooperation agreements. Similarly, Germany\u2019s Basic Law enshrines the principle of the rule of law\u2014Rechtsstaatlichkeit\u2014in Article 20(3) and requires parliamentary approval for most international treaties under Article 59(2) sentence 1. Collectively, these provisions ensure that international commitments undertaken by the Union and Germany embody democratic legitimacy and legal constraint, thereby providing the legal foundation for insisting on rule-of-law compliance by partner states (<a href=\"https:\/\/reconnect-europe.eu\/wp-content\/uploads\/2020\/05\/D7.2-1.pdf?utm_source=chatgpt.com\">Reconnect Europe<\/a>).<\/p>\n\n\n\n<p><strong>C<\/strong>. <strong>The \u201cEssential Elements\u201d Clause: Design and Legal Basis<\/strong><\/p>\n\n\n\n<p>Legally, these clauses rest on Article 60 of the Vienna Convention on the Law of Treaties, which permits suspension or termination in the event of a material breach. They enable unilateral measures\u2014up to suspension of cooperation\u2014if serious violations occur. However, the drafting of these clauses varies significantly. For instance, the EU\u2013Israel Association Agreement (Article 2) uses language closely aligned with universal instruments, simply stating that \u201crelations between the Parties, as well as all the provisions of the Agreement itself, shall be based on respect for human rights and democratic principles, which guides their internal and international policy and constitutes an essential element of this Agreement.\u201d (<a href=\"https:\/\/www.europarl.europa.eu\/RegData\/etudes\/BRIE\/2019\/637975\/EPRS_BRI%282019%29637975_EN.pdf?utm_source=chatgpt.com\">European Parliament<\/a>).<\/p>\n\n\n\n<p>By contrast, the EU\u2013Ukraine Association Agreement (Article 2) goes further by referencing not only the rule of law and democratic principles but also explicit commitments to specific international conventions and to EU law. Similarly, recent Free Trade Agreements such as the Comprehensive Economic and Trade Agreement (CETA) with Canada reference the Charter of the United Nations and the Universal Declaration of Human Rights in their preambles, while also embedding EU-specific values within operative provisions (<a href=\"https:\/\/www.europarl.europa.eu\/RegData\/etudes\/IDAN\/2023\/702586\/EXPO_IDA%282023%29702586_EN.pdf?utm_source=chatgpt.com\">European Parliament<\/a>).<\/p>\n\n\n\n<p><strong>D. Application in Association Agreements<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>EU-Ukraine Association Agreement (2014)<\/strong>:&nbsp;Article 2 of the EU\u2013Ukraine Association Agreement commits the parties to base their relations on \u201crespect for democratic principles, human rights and fundamental freedoms, and the rule of law,\u201d and explicitly states that \u201crespect for these principles shall form the essential elements of this Agreement.\u201d The Agreement further provides, in Article 478, that either party may suspend its application in the event of a serious breach of these essential elements. In practice, despite documented backsliding on rule-of-law and democratic reforms in both the European Union and Ukraine, the EU has refrained from invoking the suspension mechanism, preferring instead to employ incentives such as visa liberalisation and financial assistance to promote compliance and encourage further reforms.<\/li>\n\n\n\n<li><strong>EU-Moldova Association Agreement (2014)<\/strong>:&nbsp;EU\u2013Moldova Association Agreement (2014): The Agreement mirrors the EU\u2013Ukraine Association Agreement by incorporating both an \u201cessential elements\u201d clause (Article 2) and a specific suspension clause (Article 455). Despite ongoing concerns over judicial reforms and allegations of democratic backsliding in Moldova, the EU has consistently preferred diplomatic engagement and dialogue over invoking the suspension mechanisms provided by these clauses.<\/li>\n\n\n\n<li><strong>EU-Israel Association Agreement<\/strong>: Article 2 stipulates that \u201crelations between the Parties&#8230;shall be based on respect for human rights and democratic principles, which guides their internal and international policy and constitutes an essential element of this Agreement.\u201d Civil society and several Member States have repeatedly called for the activation of the suspension mechanism in response to Israel\u2019s settlement policies and recent military operations in Gaza. Until recently, the European Commission had declined to invoke Article 2, largely on account of geopolitical sensitivities. However, as of May 2025, the European Union has&nbsp;<a href=\"https:\/\/www.euronews.com\/my-europe\/2025\/05\/21\/eu-to-review-its-trade-and-cooperation-with-israel-over-gaza-offensive\">announced<\/a>&nbsp;a formal review of its trade and cooperation with Israel in light of the ongoing Gaza offensive, signalling a potential shift toward a more robust use of conditionality and suspension mechanisms.<\/li>\n<\/ul>\n\n\n\n<p>These examples collectively demonstrate the EU\u2019s historic reluctance to employ the \u201cnuclear option\u201d of suspension, instead favouring the gradual application of conditionality through pre-accession and neighbourhood policy instruments. The latest review of EU\u2013Israel relations, however, may indicate a willingness to reconsider this approach in response to grave breaches of fundamental values.<strong><\/strong><\/p>\n\n\n\n<p><strong>E. Rule-of-Law Clauses in EU Free Trade Agreements<\/strong><\/p>\n\n\n\n<p>In its next-generation Free Trade Agreements (FTAs)\u2014including the Comprehensive Economic and Trade Agreement (CETA) with Canada (2017), as well as the EU\u2013Singapore and EU\u2013Vietnam Agreements (2019)\u2014the EU has inserted similar \u201cessential elements\u201d clauses. The CETA preamble expressly recognises \u201cdemocracy, human rights and the rule of law\u201d as prerequisites for sustainable trade (<a href=\"applewebdata:\/\/CFD51797-73DD-4ED4-87C8-033DF0AF7079\/American%20Bar%20Association,%20'A%20Brief%20History%20of%20Arbitration'%20(ABA)%20https:\/www.americanbar.org\/groups\/tort_trial_insurance_practice\/resources\/brief\/archive\/brief-history-arbitration\/%20accessed%207%20July%202025.\">Global Affairs Canada, CETA Text<\/a>). However, while Article 8.9 (the \u201cEssential Elements Clause\u201d) of CETA would allow for the suspension of trade preferences in the event of serious breaches of fundamental values, it is important to note that CETA is currently only provisionally applied.<\/p>\n\n\n\n<p>According to Article 1(1)(a) of&nbsp;<a href=\"https:\/\/eur-lex.europa.eu\/legal-content\/EN\/TXT\/?uri=OJ:L:2017:011:TOC\">Council Decision (EU) 2017\/38 of 28 October 2016<\/a>, the provisional application does not extend to Article 8.9, which means the suspension mechanism is not yet operational. Moreover, there has been no evidence or finding of serious violations of democracy, human rights, or the rule of law by Canada that would justify activation of these clauses. Despite robust civil-society scrutiny and constitutional challenges in Germany to CETA\u2019s dispute-settlement provisions (<a href=\"https:\/\/www.bundesverfassungsgericht.de\/SharedDocs\/Entscheidungen\/EN\/2016\/10\/rs20161013_2bvr136816en.html\">Federal Constitutional Court, BVerfG, 2 BvR 1368\/16<\/a>), the EU has opted to resolve concerns through political dialogue and incremental pressure rather than legal suspension mechanisms.<strong><\/strong><\/p>\n\n\n\n<p><strong>F. Budgetary Conditionality<\/strong><\/p>\n\n\n\n<p>&nbsp;In December 2020, the European Union adopted&nbsp;<a href=\"https:\/\/eur-lex.europa.eu\/legal-content\/EN\/TXT\/?uri=CELEX%3A32020R2092\">Regulation (EU, Euratom) 2020\/2092<\/a>, a legislative instrument\u2014not an international treaty, but a directly applicable EU regulation\u2014that links access to EU funds with respect for the rule of law. This marked a significant shift from rhetoric to a robust conditionality mechanism. Under Article 4 of the Regulation, the European Commission may propose measures, such as the suspension of payments or financial corrections, if a Member State\u2019s actions \u201caffect or seriously risk affecting\u201d the sound financial management of the Union budget (<a href=\"https:\/\/eur-lex.europa.eu\/legal-content\/EN\/TXT\/?uri=CELEX:32020R2092#d1e560-1-1\">EUR-Lex, Art. 4<\/a>). In April 2022, the Commission invoked this mechanism for the first time, freezing over \u20ac6 billion in EU funds to Hungary due to breaches involving judicial independence and corruption risks.<\/p>\n\n\n\n<p>This regulation is of great significance as it directly ties rule-of-law compliance to financial leverage within the EU\u2019s legal framework, overcoming previous political hesitation and providing a concrete enforcement tool.&nbsp;Remaining with Article 4, one notes, the Commission can propose suspension of payments or financial corrections where a Member State\u2019s conduct \u201caffects or seriously risks affecting\u201d the Union budget (Art. 4).&nbsp;<a href=\"https:\/\/www.consilium.europa.eu\/en\/press\/press-releases\/2022\/12\/12\/rule-of-law-conditionality-mechanism\/\">In April 2022 it froze over \u20ac6 billion to Hungary.<\/a>&nbsp;Although effective within the budgetary realm, the mechanism does not extend to trade, external aid, or sectoral cooperation, leaving those treaty portfolios unenforceable except through political means.<\/p>\n\n\n\n<p><strong>G. Germany\u2019s Constitutional Framework and Treaty Practice<\/strong><\/p>\n\n\n\n<p>Germany\u2019s Basic Law requires parliamentary consent for important treaties (Art. 59(2) sentence 1), with the Federal Constitutional Court retaining oversight to ensure constitutionality and, in particular, adherence to the \u201ceternity clause\u201d (Art. 79(3))\u2014which protects fundamental principles, including the rule of law. In a Ruling the Federal Constitutional Court of Germany upheld the provisional application of CETA, stipulating that only EU-exclusive competence areas take effect and that the agreement must remain terminable by Germany if certain constitutional concerns arise (<a href=\"https:\/\/www.bundesverfassungsgericht.de\/SharedDocs\/Entscheidungen\/EN\/2022\/02\/rs20220209_2bvr136816en.html?utm_source=chatgpt.com\">Federal Constitutional Court<\/a>). This decision demonstrates Berlin\u2019s dual commitment: to project rule-of-law values abroad, while safeguarding domestic constitutional identity.<\/p>\n\n\n\n<p>Furthermore, in&nbsp;<a href=\"https:\/\/www.bundesverfassungsgericht.de\/SharedDocs\/Entscheidungen\/EN\/2022\/02\/rs20220209_2bvr136816en.html\">other rulings<\/a>, the Court upheld the provisional application of CETA but emphasised Germany\u2019s right to terminate mixed-agreement provisions if they breach fundamental constitutional norms. This rigorous domestic review fortifies internal rule-of-law integrity but also slows down any rapid external response when partners violate their own commitments.<\/p>\n\n\n\n<p><strong>H. Critical Assessment and Challenges<\/strong><\/p>\n\n\n\n<p>Although the EU has powerful internal tools to enforce rule of law, these lie outside the Association and Free Trade Agreement framework. Under Article 7 TEU, the Council may determine a \u201cclear risk of a serious breach\u201d of EU values by a Member State (Art. 7(1)) and ultimately suspend certain rights, including voting rights (Art. 7(2)). Nevertheless, both procedures against Poland (<a href=\"https:\/\/www.consilium.europa.eu\/en\/policies\/article-7-procedures\/timeline-the-story-of-article-7\/\">triggered<\/a>&nbsp;in December 2017) and Hungary (<a href=\"https:\/\/www.europeanmovement.ie\/just-the-facts-article-7-and-hungarys-voting-rights-in-the-eu\/#:~:text=Hungary's%20hearings,protection%20of%20LGBTQI%20rights\">triggered<\/a>&nbsp;in September 2018) stalled at the unanimity requirement, and no sanctions were imposed. This demonstrates that, even for internal infractions, political divergence among Member States can frustrate enforcement.<\/p>\n\n\n\n<p>Association Agreements. The EU\u2013Ukraine (Art. 2 &amp; Art. 478) and EU\u2013Moldova (Art. 2 &amp; Art. 455) Association Agreements both permit suspension in the event of serious breaches of democracy or rule of law. Despite backsliding in Kyiv and Chi\u0219in\u0103u, the EU has never invoked these provisions, favouring visa liberalisation and financial aid over legal suspension.<\/p>\n\n\n\n<p>Germany\u2019s Bilateral Investment Treaty Practice. Outside EU instruments, Germany has itself embedded rule-of-law language in bilateral treaties. For example, the 1995 Germany\u2013India BIT preamble refers explicitly to \u201crespect for democratic principles, the rule of law and human rights\u201d as essential elements of the investment relationship (<a href=\"https:\/\/edit.wti.org\/document\/show\/bafbe73b-7091-4a14-ab66-4c10095ab08f\">Germany\u2013India BIT, Preamble<\/a>). Yet, no claim under that treaty has ever led to the suspension of obligations, reflecting the same inertia seen in EU agreements.<\/p>\n\n\n\n<p>Free Trade Agreements. Next-generation FTAs such as CETA (Art. 8.9), the&nbsp;<a href=\"https:\/\/investmentpolicy.unctad.org\/international-investment-agreements\/treaty-files\/5714\/download\">EU\u2013Singapore (Art. 13.3)<\/a>&nbsp;and&nbsp;<a href=\"https:\/\/edit.wti.org\/document\/show\/f2a57ea5-90ba-43a7-99a9-bbb690b82d0e\">EU\u2013Vietnam (Art. 17.8)<\/a>&nbsp;Agreements contain suspension mechanisms. CETA\u2019s clause, however, is not provisionally applicable (Council Decision (EU) 2017\/38, Art. 1(1)(a)), and no serious breach by Canada has arisen to trigger it. Civil-society campaigns over Indigenous rights and environmental concerns have thus been handled through dialogue rather than legal suspension.<\/p>\n\n\n\n<p><strong>I.&nbsp;Germany\u2019s Constitutional Safeguards for International Treaties<\/strong><\/p>\n\n\n\n<p>Enforcement of rule-of-law clauses\u2014whether internal (Article 7 TEU, budgetary regulation) or external (Association\/FTA clauses, Germany\u2019s BITs)\u2014is persistently hindered by four structural obstacles:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Political Divergence<\/strong>&nbsp;among Member States, thwarting unanimity in Article 7 TEU procedures.<\/li>\n\n\n\n<li><strong style=\"font-size: 1.125rem;\">Geopolitical Imperatives<\/strong><span style=\"font-size: 1.125rem;\">&nbsp;(energy security, neighbourhood stability) that override legal triggers in external agreements.<\/span><\/li>\n\n\n\n<li><strong style=\"font-size: 1.125rem;\">Compartmentalisation<\/strong><span style=\"font-size: 1.125rem;\">&nbsp;of conditionality within the EU\u2019s internal budget, leaving trade and cooperation treaties unenforced.<\/span><\/li>\n\n\n\n<li><strong>Domestic Constitutional Safeguards<\/strong>&nbsp;in Germany that, while strengthening legitimacy, introduce procedural hurdles to swift action abroad.<\/li>\n<\/ul>\n\n\n\n<p>To overcome this impasse, the EU should extend budgetary-style conditionality to trade and neighbourhood instruments, lower decision-making thresholds to avoid unanimity deadlocks, and develop automated \u201cescalation ladders\u201d combining graduated sanctions with incentives. Germany, leveraging its constitutional influence, must champion these EU-wide reforms. Only by aligning strategic imperatives with normative commitments can Brussels and Berlin ensure that rule-of-law clauses become effective instruments of foreign policy rather than aspirational rhetoric.<\/p>\n\n\n\n<p><strong>J. Conclusion and Recommendations<br><\/strong>Rule-of-law clauses in EU and German treaties signify a forward-looking strategy to embed democratic governance in external relations. Yet their effectiveness hinges on credible enforcement. The EU should streamline activation procedures for essential-elements clauses, drawing on the budgetary conditionality model to extend to trade and cooperation instruments. Germany, leveraging its constitutional framework, should support EU-wide mechanisms and refrain from political shielding of partners in breach. Together, a coherent, calibrated approach \u2013 blending legal safeguards with diplomatic engagement \u2013 can ensure that treaties become not only vehicles of commerce but instruments for the defence and promotion of the rule of law.<\/p>\n\n\n\n<p>*Ankit Malhotra is an Advocate and Felix Scholar.&nbsp;<\/p>\n\n\n\n<p><strong>Suggested Citation<\/strong>:&nbsp;<em>Malhotra<\/em>, Rule of Law in German and European Foreign Policy : The Use of Rule-of-Law Clauses in International Treaties, jean-monnet-saar 2024.<\/p>\n\n\n\n<p><strong>DOI<\/strong>:&nbsp;<a href=\"https:\/\/doi.org\/10.17176\/20250812-075021-0\">10.17176\/20250812-075021-0<\/a><\/p>\n\n\n\n<p>Funded by the&nbsp;<strong>Deutsche Forschungsgemeinschaft<\/strong>&nbsp;(DFG, German Research Foundation) \u2013 Project No.: 525576645<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This Saar Brief explores how Germany and the EU use \u201crule-of-law clauses\u201d in international agreements as foreign policy tools, linking them to EU treaties and Germany\u2019s Basic Law. Drawing on case studies such as EU\u2013Ukraine, EU\u2013Moldova, EU\u2013Israel, and CETA, it shows a preference for political over legal enforcement. The author calls for faster enforcement.<\/p>\n","protected":false},"author":18,"featured_media":322594,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[959],"tags":[973,865,972,920,971],"class_list":["post-322593","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-online-symposium-protecting-the-rule-of-law-in-the-european-union-mechanisms-and-national-responsibility","tag-essential-elements","tag-foreign-policy","tag-international-trieaties","tag-rule-of-law","tag-rule-of-law-clauses-in-international-treaties"],"cc_featured_image_caption":{"caption_text":"","source_text":"","source_url":""},"_links":{"self":[{"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=\/wp\/v2\/posts\/322593","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=\/wp\/v2\/users\/18"}],"replies":[{"embeddable":true,"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=322593"}],"version-history":[{"count":7,"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=\/wp\/v2\/posts\/322593\/revisions"}],"predecessor-version":[{"id":322602,"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=\/wp\/v2\/posts\/322593\/revisions\/322602"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=\/wp\/v2\/media\/322594"}],"wp:attachment":[{"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=322593"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=322593"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jean-monnet-saar.eu\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=322593"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}