EU regulation between uniformity, differentiation, and experimentalism : electricity and banking compared

Abstract

This paper examines how far and under what conditions experimentalist governance (XG), defined as a recursive process of provisional goal setting and revision, based on comparative review of implementation in different local contexts, may be an effective and legitimate means of responding to diversity among EU member states, in comparison both to conventional uniform regulation (UR) and to differentiated integration (DI). The paper tackles this question through a comparative analysis of EU regulatory governance in two major policy domains, where the dilemma of how to accommodate national diversity has arisen prominently: electricity and banking. Our findings show that in these two cases the conjunction of high interdependence with high uncertainty has resulted in the emergence of a distinctive type of XG architecture, combining synchronic uniformity with diachronic revisability. Under these conditions, uniform rules and practices can be accepted as effective and legitimate by EU Member States, provided they are applied in contextually sensitive ways and regularly revised on the basis of implementation experience, through deliberative review processes in which national officials themselves participate. Our findings thus suggest that far from uniformity and experimentalism being antithetical to one another, diachronic experimentalism may be a necessary condition for synchronic uniformity of regulation within a heterogeneous polity like the EU. Our findings on EU banking regulation, where non-euro Member States may opt out of the Single Supervisory Mechanism (SSM), but where both the SSM and the European Banking Authority (EBA) operate along experimentalist lines, further suggests that XG and DI may be complementary, but asymmetrically so, in that the latter depends on the former to accommodate diversity within and across Member States, but not vice versa.