Europe’s expanding coordination space

Abstract Recent changes to EU fiscal policy, such as the landmark economic governance reform package passed in early 2024, have established a dense ‘coordination space’ that steers crucial social and economic choices at the EU and national levels. This coordination space, however, departs significantly from its historical predecessors. It largely operates within a hard law framework using finance rather than either rules or soft persuasion and peer review as its main tool of influence. In this coordination space, EU law is less a system of uniform rules underlain with sanctions than a negotiation framework where discretion abounds, and rules are never broken but rather ‘adjusted’. As this paper argues, the significance of the coordination space lies not only in its unique governance model and unclear boundaries but rather its increasing centrality to the governance of the EU. As the paper will explore using the rule of law example, even areas of EU law commonly conceived as necessarily insulated from political bargaining are increasingly drawn into the negotiation logic and instruments of coordination, rendering even more crucial a clear understanding of the trade-offs policy coordination implies. By unpacking 8 core features of policy coordination in the 2020s, the paper is therefore devoted to illuminating an expanding battleground within which EU law is being re-defined.