Social and Taxation Policies — Domaine Réservé Fields? Member States Non-compliance with Sensitive European Secondary Law

Abstract: Social and taxation policies are sensitive fields in which states often have sovereignty concerns. Accordingly, member states hesitate to transfer such competencies to the European Union (EU). Nevertheless, the EU shaped sensitive policies. Do states violate these domaine réservé fields more often than less sensitive European laws? Are those cases more difficult to settle? This paper shows that employment and taxation policies are indeed more frequently violated and that these infringement cases are harder to resolve. Yet, this is not due to sovereignty concerns, as expected by the domaine réservé thesis. Rather, the extent of non-compliance costs, the strength of domestic pro- and contra-compliance constituencies and the fit to governmental programmes are crucial for dynamics of norm violations and settlements. These variables do not systematically vary over policy fields and, in the end, states comply even with inconvenient European laws.