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FREE LAW JOURNAL - VOLUME 1, NUMBER 1 (18 JULY 2005)
section containing the term social market economy expressis verbis. “Promoting the well-being of its
peoples” as an objective is linked to the elements of the (social) market economy, though the wording
could rather satisfy the needs of those committed to a social Europe. The more detailed economic
objectives are laid down in the first four sentences of Article I-3 (3) and in some elements of subsection
(4) (free and fair trade) of the TCE.
b) Article I-3 (3) sets the objective the Union works for. This is sustainable development, which is to be
perceived as the fundamental objective and is based on three pillars, namely balanced economic growth
and price stability which are definitions of objectives and tasks pertaining to market economy at the same
time. The third pillar of sustainable development is social market economy, several elements of which are
laid down in the TCE: high competitiveness, full employment and social progress. Thus, in the course of
implementing the model of social market economy, each legislative act – without prejudice to any
interests – must set and realise these objectives. In the TCE it is also set forth in connection with social
market economy that it is to be combined with a high level of protection and improvement of the quality
of the environment. A further objective of the Union is to promote scientific and technical advance,
combat discrimination and realise economic, social and territorial cohesion. The attainment of the
economic objectives is facilitated by the fundamental freedoms, the prohibition of discrimination 60 and
the positive and negative obligations of the Member States pertaining to it: the Member States shall assist
the Union in carrying out its tasks and refrain from any measure which could jeopardise the attainment of
the Union’s objectives. 61
It follows from the co-text of Article I-3 (3) that on the one hand, social market economy is a
constitutional value, 62 and on the other hand it is a principle and the basis of the Union rather than an
objective. 63 Provisions to be implemented within the framework of social market economy are to be
regarded as objectives, namely high competitiveness, full employment and social progress. Obviously,
these – together with the fundamental freedoms – do not establish social market economy on their own,
the obligation to enforce fundamental rights and the freedoms and social rights entrenched in the Charter
of Fundamental Rights have to be attached to them. With regard to the objective of full employment it
should be noted that it may only be regarded as a guiding objective and cannot be taken as an obligation.
Competition is basically a conceptual element of market economy, thus high competitiveness may also be
defined as an objective, in other words it can be perceived as a precondition of full employment and social
progress. Social progress is an indefinable legal term and it can be related to social market economy only
if it relates to the area of economy or if the knowledge necessary for employment and competitiveness is
attached to it. The high level of the protection of the environment has previously been defined as a
fundamental element of social market economy. 64 Therefore, social market economy as a principle of the
60 Article I-4 (1) The free movement of persons, services, goods and capital, and freedom of establishment shall be guaranteed
by the Union, in accordance with the Constitution. (2) Within the scope of the Constitution, and without prejudice to any of its
specific provisions, any discrimination on grounds of nationality shall be prohibited.
61 Article I-5 (2)
62 On values see Antal Ádám: Az alkotmányi értékek fejlődési irányairól [On the Directions of the Development of
Constitutional Values]. JURA 2002/1 p 7, same author: Alkotmányi értékek és alkotmánybíráskodás [Constitutional Values
and Constitutional Jurisdiction]. Osiris. 1998. pp 33-39
63 Joerges and Rödl regard social market economy as a constitutional principle. They refer to the fact that Müller-Armack has
never perceived social market economy as an objective. He has spoken of model, formula of integration or style. Neither the
German commentators take this term as an objective, but they refer to the ‘strategy of economic policy’ in order to attain the
objective pursuant to the clause on social state. Joerges-Rödl: „Social Market Economy” as Europe’s Social Model? p 19. On a
different view see http://europa.eu.int (01 02 2005) SCADPlus: Constitution for Europe. The founding principles of the Union.
p 2.
64 On the social market economy of the Union see Katrougalos: The „Economic Constitution” of the European Union … p 20.
DR. TÍMEA DRINÓCZI - SOME ELEMENTS OF THE ECONOMIC CONSTITUTION OF THE EU: SOCIAL MARKET ECONOMY AND RELEVANT FUNDAMENTAL RIGHTS 74