Bom in part from the frustration over the slow pace of integration and a growing appreciation of the advantages such reforms might have in combatting Europe’s declining economic fortunes (known as “Eurosclerosis”), the ten members of the Community put aside the Luxembourg Compromise and decentralized federalism and adopted in 1986 the Single European Act (SEA) and a new institutional structure closely approximately that of centralized federalism. The rule of unanimity was replaced by a “consultation procedure” and a commitment to allow qualified majorities to make substantive policy decisions. Proposals would come from the European Commission as before. Now, however, only a qualified majority of the Council was needed for a policy to become law. A qualified majority was defined as receiving 54 votes from a total of 76 allocated as: France, Germany, Italy, and the United Kingdom, 10 votes each; Spain (newly admitted under the SEA), 8 votes; Belgium, Greece, Netherlands, and Portugal (newly admitted under the SEA), 5 votes; Denmark and Ireland, 3 votes; and Luxembourg, 2 votes. Further, the Commission’s proposals could be only accepted or rejected; unanimity was required for the Council to amend the Commission proposals. The effect of the consultation procedure was to give strong agenda-setting powers to the Commission; policy-making became centralized in the executive.

The consultation procedure applied to all policy areas covered by the original Treaty of Rome (agriculture, transportation, social policy, environmental policy, regional and fiscal policies) except for those policies concerned with the completion of the internal market (competition policy, free movement of goods, labor, and capital). For this policy assignment, the SEA recommended a second innovation to Community decision-making called the “cooperation procedure.” The central difference between the consultation and cooperation procedures is the enhanced role under cooperation for the (now elected) European Parliament. Under cooperation, policies approved by the Council go to the Parliament to be accepted, rejected, or amended by majority rule. If accepted the proposal becomes law. If rejected, the proposal may still become law if subsequently approved by a unanimous Council. If amended, the proposal returns to the Commission which can either reject the amendments (again the proposal dies unless unanimously approved by Council) or return the amended bill to the Council where it becomes law if approved by a qualified majority. The cooperation procedure raises the Parliament to the role of a conditional agenda-setter, where an alliance between the Commission and the Parliament (a frequent outcome) can force the Council to make decisions on their terms (Garrett 1995 and Tsebelis 1994). The Parliament, however, has no original agenda-setting powers under cooperation, for that it must rely upon the Commission. The pivotal institution for policy innovation under the SEA became the European Commission, an executive cabinet appointed by member nations but charged with ensuring an economically integrated Europe.