The Role of Political Actors’ Preference Variation in the Decision-Making Process of the European Union

Abstract

Member states and interest groups, as key political actors, play crucial roles in the decision-making process of the European Union (EU). This study examines the relationship between the variation in political actors’ preferences and decision-making procedures, emphasizing the roles of interest groups and member states as critical stakeholders. This research employs a process-tracing method, analyzing two case studies—the Transatlantic Trade and Investment Partnership (TTIP) and the EU Emissions Trading System (EU ETS)—to investigate the causal mechanisms linking preference heterogeneity to the duration of decision-making processes. The findings reveal that preference heterogeneity functions as a multidimensional factor, encompassing not only disagreements but also the interplay of diverse interest group demands and the strategic positioning of member states within institutional frameworks. By identifying the specific mechanisms of these interactions, this study underscores the importance of accounting for varying levels of issue salience and their impact on procedural dynamics when devising legislative strategies.

1. Introduction

Interest groups and member states, as key political actors in the EU, play a vital role within the Union’s governance system. Member states face a conundrum in the post-consensus era. They could continue to conduct consensus politics, although this would risk increasing public resistance to the EU and widening the divide between public and elite perspectives (De Wilde et al. 2018; Hooghe and Marks 2009). They could also reject consensus politics and attempt to politicize the European question in national and European politics (De Wilde 2007; De Wilde and Zürn 2012; Hooghe and Marks 2009). Continuing down this path, member states may promote interest groups’ participation in legislation while permitting domestic politicians and political parties to have opposing viewpoints on EU issues.

Extensive consultation may contribute to the democratic legitimacy of legislative proposals, but interest groups are likely to represent different views and bring many issues to the attention of decision-makers, which could increase the duration of the decision-making process. Decision-making processes may thus be delayed or even blocked by influential lobbying coalitions (Beyers and De Bruycker 2018). While diverse actor involvement in the EU decision-making process may increase the democratic legitimacy and quality of its decisions (Greenwood 2017), preference heterogeneity may endanger decision-making efficiency if stakeholder opinions oppose each other (Dür and Mateo 2012; Michalowitz 2004; Rasmussen and Toshkov 2013). The different views of the public, mobilized by interest groups, feed into the decision-making process as they affect member state preferences.

In early studies, policy deadlock in the decision-making process was attributed to the limited influence of the European Parliament. One study explored the complexity of stakeholder interactions within the EU’s legislative process, demonstrating that well-organized interest groups often succeed in shaping policy directions (Bunea et al. 2022). Another relevant study examined the influence of different stakeholders on the duration of legislative decision-making within the EU, emphasizing that more intense divisions in stakeholder opinions lead to a longer legislative decision-making process (Lei 2024). This may suggest that when interest groups present negative opinions about a legislative proposal, member states may become more aware of the fact that citizens in their domestic arena have different views about a proposal, which may lead to the adoption of opposing positions in the Council. As a result, the decision-making process may last longer due to bargaining between member states with rather different views.

The duration of legislative decision-making procedures under the ordinary legislative procedure (OLP) in the European Union varies depending on the complexity of the subject matter and the specific circumstances of each case. Data indicate that the majority of OLP cases are resolved relatively quickly: approximately 85% of legislative acts are finalized during their first reading, 13% require a second reading, and only 2% advance to the conciliation stage (Dionigi and Rasmussen 2019). Each stage affects the overall timeline, with first readings typically being faster than the more complex conciliation processes. For a more precise benchmark, studies estimate that the average timeframe from an initial proposal to its final adoption under the OLP ranges from 12 to 24 months for straightforward cases. More contentious or complex legislation can take significantly longer, sometimes more than several years (Hurka and Haag 2020). Accordingly, this study adopts a typical 12–30-month period as a baseline for standard timelines and classifies durations exceeding 30 months as protracted.

The political domain includes a diverse range of actors, such as citizens, politicians, political parties, bureaucrats, social movements, and interest groups. Government officials play a vital role in designing and implementing public policies and ensuring the execution of political decisions. In political exchanges, interest groups serve as intermediaries, conveying societal needs to the state. When scholars examine the profiles of bureaucrats, they typically focus on factors such as education, professional experience, and partisan affiliation, with some also considering gender and race (Kennedy 2014; Riccucci et al. 2018). Although some studies explore the influence of interest groups on political appointments using game theory (Macedo de Medeiros Albrecht 2023), few examine the key concepts and empirical evidence surrounding the interactions between member state governments and interest groups. Previous studies have presented correlations between the policy preferences of different actors and EU decision-making delays (Haag et al. 2024; Lei 2024). However, there are other potential alternative explanations for these correlations which have not been considered in their quantitative analyses. To conclude that a causal relationship indeed exists, it is essential to evaluate alternative explanations which may have the same effect. Therefore, this study further analyses the interplay of EU policymaking by proposing the following research question: What is the causal mechanism of the interaction between the opinions of interest groups and member state preferences in the EU decision-making process?

More specifically, this study examines the relationship between the variation in political actors’ preferences and decision-making procedures, emphasizing the roles of interest groups and member states as critical stakeholders. Interest groups and member states, as key political actors in the EU, play a vital role within the Union’s governance system. Interest groups, including business associations, civil society organizations, and consumer groups, act as intermediaries between the public and EU decision-makers (Flöthe and Rasmussen 2019; Flöthe 2020). They aggregate and convey the demands of various sectors to the European Commission, the European Parliament, and the Council. However, these groups are often divided internally, which may impair their potential to serve as a “transmission belt” (Kohler-Koch 2010; Kohler-Koch and Buth 2013), as different factions within a single interest group may have competing preferences. This internal heterogeneity can limit their ability to present a unified position, which in turn complicates their influence on the decision-making process.

On the other hand, member states play a crucial role in the negotiation and adoption of EU policy, particularly within the Council of the European Union. While member states contribute to the formation of EU policies, their preferences are not shaped solely by EU-wide goals. Instead, they are deeply influenced by domestic political factors. Key domestic actors, such as exporters, consumers, national interest groups, and political parties, significantly impact the positions that governments take in EU negotiations (Koop et al. 2022; Coen et al. 2024). For instance, exporters may push for policies that prioritize market access and trade, while consumer groups may advocate for stronger protections, such as health and safety regulations. Political parties and national interest groups further shape government positions, especially when political leaders face domestic pressure from voters or stakeholders. This interplay between domestic interests and EU-level negotiations often results in divergent preferences among member states, which can delay the decision-making process and make it more complex.

This study uses process tracing to examine whether these processes indeed contribute to longer decision-making durations. Studying causal mechanisms strengthens claims about causality beyond correlational and counterfactual designs by uncovering the “black box” of relationships (Beach and Pedersen 2013), revealing the link between diverse preferences and extended decision-making processes and empirically assessing them. It analyzes the causal link between the diverse preferences of member states and interest groups and prolonged EU decision-making. The following section introduces the theoretical foundation for explaining varied positions in the EU decision-making process. The Section 3 presents the interplay of the two factors shaping political actors’ positions and their negotiation. The Section 4 details the methodology and case selection strategies used. The Section 5 showcases the results from the two case studies chosen. Finally, Section 7 validates these empirical findings and discusses their implications, limitations, and future research.

2. Theoretical Framework

2.1. The Role of Interest Groups, Member State Preferences, and Domestic Politics in the EU Decision-Making Process

Interest groups are essential to the EU decision-making process as they serve as intermediaries that channel public and sectoral interests to EU institutions. They play a key role in shaping policy proposals by engaging in lobbying, public consultations, and advocacy campaigns (Dür and Mateo 2012). Hence, interest groups help ensure that their members’ views are aggregated and conveyed to decision-makers (Dahl 2005; Truman 1971). Through these activities, interest groups seek to influence the positions of the European Commission, the European Parliament, and member states within the Council. However, the effectiveness of interest groups is often complicated by internal divisions. These groups may represent a broad spectrum of interests, and within each group there may be conflicting views on the policy in question. This internal heterogeneity can dilute their ability to present a cohesive stance, ultimately weakening their influence on the outcome of negotiations.

While interest groups primarily advocate for sectoral interests, member states in the EU must balance both national and EU-wide concerns. Member states’ preferences are deeply shaped by domestic political dynamics, including the influence of key national actors such as exporters, consumers, national interest groups, and political parties. For example, in trade policy, member states with large export sectors may prioritize policies that promote market access and reduce trade barriers. Conversely, member states with strong environmental constituencies may push for more stringent regulations on emissions or consumer safety. These national interests are further complicated by political party dynamics, where the parties in government must navigate domestic pressures from their voters and interest groups.

The preferences of member states are therefore not static; they evolve as domestic actors influence the positions that governments adopt. For example, in terms of climate policy, member states with industrial sectors that are heavily dependent on carbon-intensive industries may resist ambitious environmental policies due to concerns over economic competitiveness. In contrast, member states with more environmentally conscious electorates may push for stronger environmental protections, even at the expense of economic growth. These divergent preferences among member states can lead to strategic bargaining, where countries form temporary coalitions based on shared domestic interests. As a result, the decision-making process can become prolonged and contentious as member states attempt to reconcile their domestic concerns with EU-wide objectives.

2.2. The Interaction Between Interest Groups and the Member States’ Preferences

The literature on EU legislative politics highlights conflicts among member states and within the Council as key obstacles to the EU decision-making process. Two key features help clarify this dynamic. First, both the European Commission and the European Parliament often advocate for policy changes, suggesting that member states are frequently reluctant to act (Dür et al. 2015). Consequently, the Commission and the Parliament often play a more assertive role than member states in driving policy change. Second, member states’ preferences are shaped by domestic political factors and the opinions of important interest groups, which can bridge the gap between EU policy and public opinion, enhancing the democratic legitimacy of the decision-making process. However, conflicts between member states may arise due to differing views or the influence of interest groups. When these groups are divided, it can affect member states’ preferences, leading to intra-institutional conflicts, especially within the Council (De Ruiter and Vliegenthart 2018).

The variation in member state preferences can be categorized as heterogeneous or homogeneous, depending on how a proposal is handled in the Council. “A items” are trivial proposals already agreed upon by working groups or the COREPER, indicating homogeneous preferences among member states. In contrast, “B items” require extensive discussion due to member state disputes, reflecting more heterogeneous preferences (Best and Settembri 2008; Häge 2011). The domestic dimension of member states’ preferences is crucial for understanding the EU decision-making process. When domestic interest groups oppose a policy proposal, their opposition can influence a government’s stance in EU negotiations. Governments may adjust their positions to align with powerful domestic groups or to avoid public backlash, contributing to divergent preferences and delays in the decision-making process. The need to balance domestic concerns with broader EU goals often results in a more time-consuming and contentious process.

Interest groups also significantly influence public policy, but their conflicting positions can prolong negotiations (Murphy 2023). While involving interest groups early in the legislative process can help reconcile conflicts (Toshkov et al. 2013), they may also protest issues before the procedure begins, drawing attention to contentious matters. When member state preferences conflict with interest group positions, member states may shift their stance to address domestic concerns. This interaction leads to divergent positions within the Council, increasing transaction costs and prolonging the legislative process. The more divided the preferences of both interest groups and member states, the longer the decision-making process is likely to take.

2.3. Connecting the Input, Throughput, and Output of Decision-Making Processes

There are inherent trade-offs between democratic input, throughput legitimacy, and output legitimacy, where improving one may sometimes come at the expense of others. The theoretical framework for analyzing these concepts is drawn from system theory, with “input” and “throughput” legitimacy (Schmidt 2009, 2013) serving as central components. Democratic input legitimacy focuses on participation in the decision-making process, where legislative proposals should align with the demands of citizens and their representatives (Scharpf 2009). Throughput legitimacy, on the other hand, emphasizes the quality and transparency of procedures within the EU’s legislative “black box,” where interest groups and member states interact to shape policy outcomes (Schmidt 2009). Finally, output legitimacy pertains to the effectiveness of the resulting policies—measured by their functionality, enforceability, and stakeholder satisfaction (Scharpf 1999, 2018).

Input legitimacy is primarily concerned with the role of interest groups, who channel the interests of specific groups of citizens into the EU decision-making process. This occurs through mechanisms such as public consultations, lobbying, and participatory initiatives promoted by EU institutions. Policy demands from interest groups often influence the positions of key political actors, such as the European Commission, the European Parliament, and member state representatives in the Council, which are shaped by domestic societal interests (Moravcsik 2013). The EU’s emphasis on inclusiveness and participatory governance aims to enhance democratic input by fostering direct and indirect stakeholder engagement.

Throughput legitimacy addresses the procedural aspects of EU governance, focusing on the quality of interactions among political actors and the mechanisms by which demands are translated into policy outcomes (Schmidt 2013). High-quality throughput legitimacy involves transparent, inclusive, and deliberative processes that mediate conflicting preferences, enabling compromises among interest groups and member states. Scholars argue that throughput legitimacy ensures procedural clarity and fairness, which are critical for maintaining trust in the EU’s legislative system (Schmidt 2009). However, the competitive nature of policymaking means that not all demands can be met equally, leading to trade-offs and diluted compromises.

Output legitimacy reflects the EU’s ability to produce effective policies that meet societal needs and stakeholder expectations (Scharpf 1999, 2018). While the primary focus of this study is on procedural factors, the implications for output legitimacy cannot be ignored. Prolonged decision-making may enhance the quality and inclusiveness of deliberations, but it can also delay the implementation of necessary policies and reduce their effectiveness. For instance, policies shaped by protracted negotiations may face challenges in their enforceability or fail to satisfy key stakeholders due to over-compromising.

The interplay between these dimensions highlights the challenges of balancing inclusiveness, procedural rigor, and policy effectiveness. While more stakeholder participation (input legitimacy) may enrich deliberations and enhance democratic representation, it can also increase the complexity of negotiations, potentially undermining throughput efficiency. This study underscores that poor throughput legitimacy—characterized by opaque processes or misaligned interest group and member state interactions—can weaken both procedural legitimacy and the perceived effectiveness of policy outputs.

EU decision-makers must carefully navigate the trade-offs between input, throughput, and output legitimacy. High-quality throughput legitimacy can mitigate the risks of prolonged decision-making by fostering transparent and inclusive processes that build consensus and reduce conflict. Moreover, aligning interest groups demands with member state preferences early in the legislative process can enhance the coherence and enforceability of policy outputs, strengthening their overall legitimacy. By incorporating this expanded discussion of output legitimacy and its relationship with input and throughput legitimacy, this study provides a more holistic understanding of the EU’s governance framework. This integration of perspectives lays the foundation for exploring the broader implications of procedural length on the effectiveness and legitimacy of EU policymaking.

3. Causal Mechanism

3.1. Causal Mechanism Behind the Length of the Decision-Making Process

This section discusses the causal mechanism underlying the interacting effects of transmission belts and transaction costs, which is expected to reveal how the divergent preferences of interest groups and member states led to the lengthy decision-making processes seen in the cases of the Transatlantic Trade and Investment Partnership (TTIP) and the EU Emissions Trading System (ETS). The researcher presents a mind map of the expected causal mechanism in Figure 1.

As previously noted, this study begins with a scenario in which interest groups hold opposing views while member states exhibit divergent preferences regarding a legislative proposal. The theoretical mechanism at work can be described as follows: during the initial decision-making process, interest groups provide extensively negative feedback on the proposal through consultations. Once the European Commission submits the proposal to the Council, member states articulate differing positions during Council meetings, mirroring the disparities observed among the interest groups. In the absence of a clear common position, these divergent views contribute to a prolonged decision-making process. Based on datasets from prior cases, the researcher anticipates identifying observable manifestations of these causal mechanisms, as presented in

Table 1. Observable manifestations (OMs) of causes.

Cause	Transmission Belts from the Interest Groups’ Heterogeneity
OM 1	Evidence of conflicting demands in interest groups’ divergent public statements
OM 2	Lobbying efforts or position papers from key interest groups.

,

Table 2. Observable manifestations (OMs) of intermediate mechanisms.

Intermediate Mechanism	Transaction Costs of Member States’ Disagreement
OM 3	Evidence of divergent member state negotiation positions
OM 4	High-profile policies and politically sensitive issues documented in Council records
OM 5	Official documents, public statements, or negotiation positions showing alignment with interest groups demands

and

Table 3. Observable manifestations (OMs) of outcomes.

Outcome	Institutional Complexity Results in a Lengthy Decision-Making Process
OM 6	Evidence of procedural delays
OM 7	Prolonged legislative timelines
OM 8	Multiple rounds of negotiation

.

More specifically, this section emphasizes observable indicators that concretely demonstrate how interest groups and domestic coalitions influence EU decision-making processes. It identifies actionable evidence, such as delays in Council negotiations attributable to conflicting priorities driven by interest group lobbying. For instance, when draft proposals are repeatedly revised due to competing demands from business associations and environmental organizations, these delays serve as measurable outcomes of such conflicts.

Moreover, the observable manifestations highlight instances where member states’ positions during negotiations are visibly shaped by domestic coalitions. Official meeting records or interview transcripts often reveal explicit references to interest group demands, showcasing their influence. For example, a member state might propose amendments to draft legislation that directly reflect concerns raised by influential national industry groups or labor unions. Observable manifestations also examine patterns of coalition formation within the Council, illustrating their alignment with specific lobbying strategies used by interest groups. These coalitions often mirror the priorities of prominent lobbying entities, as evidenced by voting blocs or joint proposals. Additionally, documented changes in draft legislation—such as the inclusion of specific clauses favoring particular sectors—can frequently be traced back to sustained advocacy efforts by interest groups. By focusing on such tangible manifestations, this study moves beyond generalized statements, providing concrete examples of how the interplay between member states and interest groups shapes EU policy outcomes.

3.2. Cause: Transmission Belts from Interest Group Heterogeneity

The transmission belt is a complex function involving organizing interest groups to transmit the views of the public to member states in the EU decision-making process. These transmission belts play a crucial role, allowing the public to express views and opinions on policy issues, which are transformed by various interest groups or groups of stakeholders (Albareda and Braun 2019). Interest groups in the EU context serve as a transmission belt by providing useful policy information to their national institutions and simultaneously aggregating and representing the diverse interests of their constituency (Berkhout et al. 2017). However, when other stakeholders hold negative opinions of a policy proposal or its adoption and require a policy change or alternative proposal, interest groups may require more time to reconcile differing voices (Table 1, OM 1). Interest groups are less involved in the direct legislative decision-making process (Kohler-Koch and Quittkat 2013), as their ability to connect with their committee members is significantly different (Binderkrantz 2009). The transmission belts of interest groups play a crucial role in allowing their members to express opinions on policy issues. Moreover, interest groups give political parties a place to represent their views in national and EU politics. Therefore, many interest groups work hard to reinforce their transmission belts, using their close ties with governments, EU decision-makers, and MEPs (Table 1, OM 2).

3.3. Intermediate Mechanism: Transaction Costs of Member States’ Disagreement

The second argument is based on the idea that disagreements among member states exacerbate the transaction costs of decision-making. While each member state may have mandated priorities in their national-based interests (Judge and Thomson 2019), this may lead to rather different views that are not easy to bring together. The rejection of a proposal, either in the search for consensus or by forming a blocking minority, may prevent legislation from being adopted. Therefore, member states’ disagreement increases the transaction costs for the Council to come to a decision (Table 2, OM 3).

As the Council does not have the right to initiate legislation, member states’ ability to pursue their goals is conditional on the willingness of the European Commission to propose legislation. If the European Commission disapproves of the amendments, it advises against them, prolonging the legislative process. Within the Council’s structure, heterogeneous preferences among member states are also visible at the level of working groups and the Committee of Permanent Representatives (COREPER), which is seen as the highest body with non-political participants (Beyers and Dierickx 1998). While non-controversial issues are often handled by working groups, more controversial ones move up to the COREPER or even the Council. When working groups or the COREPER are not able to resolve specific issues, they will pass them on to the Council as “B items” (Table 2, OM 4). The configuration of member states’ preferences determines possible policy change in the Council. Taken together with the logic of the transmission belts, decisions are expected to be shaped by the demands of interest groups and bargaining among member states (Table 2, OM 5).

3.4. Negotiation Outcomes: A Lengthy Decision-Making Process

The principle of EU decision-making is based on continuous interactions between EU decision-makers and member state representatives and their bilateral exchange with interest groups. Member state governments are held accountable by their domestic civil society organizations and interest groups (Tömmel 2017). This ensures that EU policies are beneficial for their supporting interest groups. One of the effects is that the long-term impact of EU policies may be less significant to the member state than the short-term political benefits. Therefore, member state governments may be primarily concerned about the demands of their domestic interest groups (Table 3, OM 6).

Moreover, interest groups’ demands affect member states’ preferences and their strategies in the EU decision-making process (Table 3, OM 7). EU decision-making is often characterized as a two-level game in which the domestic level is interconnected with the EU level (Putnam 1988). While the “input” of the member states affects the negotiations happening in Brussels, the resulting legislation influences national policies. Interest groups complicate this process, as they may affect the preferences of member states. For instance, on highly salient policy issues, member state governments may pressure their MEPs to support their position in the Council (Costello and Thomson 2016). However, member state governments prefer to promote publicly supported policies to reinforce their MEPs’ powers when it comes to less salient issues (Rasmussen 2015). Furthermore, heterogeneous opinions among various interest groups may reinforce the differences in views among member states in the Council (Table 3, OM 8). This may especially occur when rather ‘powerful’ interest groups are involved, such as unions or employer associations, or when preferences within the EP and Council seem to align (Dür and Mateo 2012; Dür et al. 2015). If evidence shows that the negative opinions of interest groups do indeed relate to the member states’ disagreement in some cases, then the decision-making process is delayed due to the combination of their interactions. Eventually, the heterogeneous views of interest groups are expected to shape decision-making outcomes by creating conflicts between member states, as evidenced by divergent lobbying efforts documented in Council submissions, delays in rounds of negotiation, and explicit references to interest groups’ demands in member state negotiation positions.

4. Research Design

4.1. Methodological Approach: Process Tracing the Causal Mechanism

In this study, process tracing was employed to investigate the causal mechanism linking preference heterogeneity among interest groups and member states to the length of the EU decision-making process. The method involved systematically identifying observable manifestations at each step of the hypothesized mechanism, gathering evidence from primary and secondary sources, and evaluating whether the evidence supported or contradicted the hypothesized relationships. Process tracing helps to identify the policy issues on the Council’s agenda, the context of the legislative negotiations, the position-taking of member states during the process, and the roles of the other decision-makers (Beach 2017). Process tracing can track key points and analyze the processes generated based on strategic interactions, whereas statistical models or regression analyses can only provide the correlations between different factors (Hall and Deardorff 2006). As a consequence, it may pinpoint the occurrence of steps or elements that are part of a causal mechanism that is at work. In this way, process tracing permits the discovery of causal relationships (Naurin and Rasmussen 2011). Interestingly, process tracing can be executed through semi-structured interviews, official documents, and media reports, as it relies on key actors who provide information about the input and throughput of the process in terms of causality (Kay and Baker 2015).

4.2. Case Selection and Sampling

These cases were selected because they are controversial and can be deemed typical cases in which member states in the Council have heterogeneous preferences regarding a legislative proposal. The following criteria were used:

• Several rounds of negotiation took place before the formal legislation was adopted;
• Different interest groups and member states were involved in the legislative negotiations;
• Negotiations became stuck, without withdrawal or formal rejection;
• The legislative proposal featured was complicated, multifactorial, and had specific contextual issues (Winnwa 2018).

Applying these criteria, two cases were selected, i.e., the Transatlantic Trade and Investment Partnership (TTIP) and the EU Emissions Trading System (EU ETS), which differ in terms of their dependent variable (a lengthy decision-making process) and independent variables (negative opinions of interest groups and heterogeneous preferences of member states). A comparative table has been added to systematically contrast the two cases across four dimensions (see

Table 4. Comparison of the two selected cases across four dimensions.

Cases	Transatlantic Trade and Investment Partnership (TTIP)	EU Emissions Trading System (EU ETS)
Policy type	Trade and investment agreement.	Market-based environmental regulation.
Stakeholder structure	Stakeholder consultations included business groups, civil society, and policymakers from both the EU and the US.	Consultations with industries, environmental groups, and member states, with regular revisions (e.g., Fit for 55).
Public engagement level	High public engagement. Significant opposition, protests. Transparency concerns.	More limited public engagement. Focused on technical and environmental sectors. Some public concerns over economic impacts and fairness.
Institutional constraints	Complex negotiations between two sovereign entities (EU and the U.S.). Resistance from member states and public opinion, and the involvement of multiple political bodies.	Operated within the EU’s existing regulatory framework. Challenges from member states, economic sectors, and technical aspects related to carbon pricing and allowances.
Similarities	Both involved extensive international negotiations and regulatory frameworks. Both faced public scrutiny and political resistance. Both impact industries and economic policies at the EU level.

).

More specifically, the TTIP was a proposed trade agreement between the European Union (EU) and the United States (US) aimed at reducing regulatory barriers, enhancing market access, and fostering investment. Unlike EU directives or regulations, the TTIP was a trade negotiation rather than a piece of EU legislation subject to the ordinary legislative procedure. Thus, the TTIP followed a different procedural path to that of legislative acts adopted by the European Parliament and the Council of the EU. Instead of being directly enacted into law through legislative processes, it required negotiation, approval, and eventual ratification but did not inherently possess binding legislative authority within the EU legal framework.

A critical distinction in understanding the TTIP’s procedural framework lies in the role of the European Commission. Under Article 207 of the Treaty on the Functioning of the European Union (TFEU), the Commission holds exclusive competence over trade policy and is solely responsible for negotiating TTIP on behalf of the EU. Member states are not direct negotiators; instead, they influence the process through the Council of the EU, which sets the Commission’s negotiation mandate. This distinction is important because, while EU legislative processes involve both the European Parliament and the Council, trade negotiations are primarily an executive function managed by the Commission. The Parliament and the Council only played a role in approving or rejecting the final agreement at later stages.

Another key clarification concerns the 2014/2228(INI) recommendation, which has been cited in discussions of the TTIP. This non-binding resolution, issued by the European Parliament rather than the Council, reflected a political stance rather than a legislative act. Similarly, the Council issued negotiation directives to the Commission outlining the EU’s objectives for the TTIP, but these directives were not legally binding. Unlike EU regulations, directives, or decisions, neither the Parliament’s recommendation nor the Council’s directives imposed enforceable obligations on member states or the Commission.

Thus, TTIP negotiations were solely the Commission’s responsibility, with member states contributing indirectly through the Council. Furthermore, the Council’s recommendations and the European Parliament’s 2014/2228(INI) resolution were non-binding, underscoring the TTIP’s distinction from formal EU legislative acts. These clarifications help ensure accuracy in understanding the TTIP’s classification within the EU’s broader policy and decision-making framework.

Although the TTIP is not a legislative procedure, it offers a valuable comparative lens for understanding how interest groups’ heterogeneity shapes negotiation dynamics in high-stakes EU decision-making processes. The TTIP serves as an illustrative example of a complex, multilateral decision-making process influenced by interest groups’ heterogeneity and the preferences of member states. This example complements the legislative case by highlighting broader decision-making patterns.

In contrast, the EU ETS is binding legislation that was debated within EU institutions and reflects EU climate policy discussions. The case highlights how prolonged decision-making is linked to high levels of contention and disagreements among member states, especially regarding environmental issues. The EU-ETS legislative case was selected because of its rich empirical data, enabling a robust application of process tracing. This case illustrates how preference heterogeneity among member states and interest groups can extend the decision-making process, offering clear, observable evidence of the causal mechanism under investigation. Although the EU-ETS case is historical, the legislative procedure it examines has not undergone significant structural changes, ensuring that the insights derived remain relevant to contemporary contexts. Furthermore, the empirical depth of this case provides a valuable foundation for tracing the causal mechanisms linking preference heterogeneity to prolonged decision-making.

These two cases were selected to provide complementary insights into how preference heterogeneity affects EU decision-making. While the EU-ETS case offers a focused analysis of a legislative procedure, the TTIP case demonstrates similar dynamics in a broader negotiation context, thereby enriching this study’s findings and enhancing its generalizability. Both cases were subject to contentiousness, heterogeneous preferences, and the influence of external factors.

The analysis relied on evidence from official EU documents, meeting minutes, stakeholder position papers, media reports, and semi-structured interviews, following the methodological rules used to assess causal mechanisms and theorize the links between causes and outcomes. These sources provided insights into the positions of member states and interest groups, the evolution of negotiations, and the points of contention that prolonged the decision-making process.

In the TTIP case, process tracing focused on tracing the role of divergent stakeholder preferences in influencing member state strategies and how these shaped the overall negotiation process. Evidence included public statements by interest groups, correspondence with EU institutions, and media reports documenting key stages of the negotiation. In the EU-ETS legislative case, process tracing involved mapping the positions of member states and interest groups at different stages of the negotiation, identifying instances of preference divergence, and examining how these disagreements delayed consensus-building. Key pieces of evidence included documented voting records, policy drafts, and interest group submissions that highlighted points of conflict and their resolution over time.

4.3. Certainty, Uniqueness, and Hypothesis Testing

This study uses a probabilistic and Bayesian-inspired logic of updating based on empirical evidence at the epistemological level (Beach and Pedersen 2013). The core of Bayesian logic is the rigorous appraisal of which various kinds of empirical evidence might potentially reveal the truth of causal theories (Beach 2017). Two questions should be evaluated when applying Bayesian logic to process tracing. That is, whether we had to find a given piece of empirical material (certainty of evidence), and, if so, whether there are any plausible alternative explanations for finding that empirical material (uniqueness of evidence) (Beach and Pedersen 2013; Rohlfing 2012; Van Evera 2016). In other words, certainty estimates the probability of identifying a particular observable manifestation during process tracing (Rohlfing 2012). Uniqueness assesses whether an observable manifestation is the result of a single or multiple hypotheses (Rohlfing 2012).

Furthermore, four types of hypothesis tests, i.e., the hook test, smoking gun test, doubly decisive test, and straw-in-the-wind test (Van Evera 2016), are distinguished by the degree of certainty and uniqueness they attribute to the observable manifestations (Beach 2017; Collier 2011; Mahoney 2012). The combination of high and low certainty with high and low uniqueness generates four tests that permit the derivation of inferences in terms of a working hypothesis and competing hypotheses, depending on whether the working hypothesis passes or fails the test (Collier 2011).

Table 5. Differences between four hypothesis tests developed from Bayesian logic.

Types	Certainty	Uniqueness	Strength	Sufficiency for Inferring Causality
Hoop test	High	Low	Stronger	Insufficient
Smoking gun test	Low	High	Stronger	Sufficient
Doubly decisive test	High	High	Strongest	Sufficient
Straw-in-the-wind test	Low	Low	Weakest	Insufficient *

* Adapted typology from Rohlfing (2012, p. 612), Collier (2011, p. 825).

presents the differences between the four hypothesis tests developed from Bayesian logic.

First, a hoop test is identified by its high certainty and low uniqueness. Due to its insufficient uniqueness, passing the hoop test is inadequate for inferring causality. However, passing the test is essential, since failing a test that was predicted to be passed casts significant doubt on the hypothesis (Rohlfing 2012). Second, a smoking gun test combines low certainty with high uniqueness. A successful smoking gun test is sufficient for the confirmation of causal inference because it provides credibility to the captured hypothesis (Rohlfing 2012). Third, the doubly decisive test combines high levels of certainty and uniqueness to improve case selection and causal inference (Rohlfing 2012). Because of the combination of high uniqueness and certainty, passing this test is both essential and adequate for the confirmation of causal inference (Rohlfing 2012). Last, a straw-in-the-wind test is characterized by low uniqueness and low certainty. It, therefore, is the weakest of these four tests (Collier 2011). Similarly to a hoop test, passing the straw-in-the-wind test is insufficient to prove that the captured hypothesis is confirmed, as the conservative hypothesis would also be confirmed, resulting in low uniqueness (Rohlfing 2012).

Table A1. Observable manifestations, certainty, uniqueness, and hypothesis tests.

Observable Manifestations	Certainty, Uniqueness, and Hypothesis Tests
C1. OM1. Interest groups hold a negative attitude or opposing opinions about a policy which is to be adopted via consultations; they require the legislative proposals to be adjusted.	High certainty: evidence needs to be found in the consultation documents to prove the presence of interest groups. Low uniqueness: the presence of negative opinions from interest groups can be explained by conflict constellation in EU institutions. The evidence was found: the hypothesis passes the hook test.
OM2. Interest groups work hard to reinforce the function of interest groups’ transmission belts.	Low certainty: there may be other factors affecting the decision-making processes behind the interest groups’ transmission belts. High uniqueness: if found, the evidence cannot be explained by alternative hypotheses. The evidence was found: the hypothesis passes the smoking gun test.
C2. OM3. Different member states take opposing positions in different Council meetings, increasing the transaction costs required to reach a deal.	High certainty: evidence of increased transaction costs needs to be found to prove the presence of member states’ opposing positions. High uniqueness: if found, the evidence cannot be explained by alternative hypotheses. The evidence was found: the hypothesis passes the doubly decisive test.
OM4. Member states must debate, in the Council, the politically sensitive issues that remain unresolved, before finally adopting Coreper I/II Part 2 (B items) resolution after discussion.	High certainty: evidence of COREPER II/ B items needs to be found to prove their presence. High uniqueness: if found, the evidence cannot be explained by alternative hypotheses. The evidence was found: the hypothesis passes the doubly decisive test.
OM5. On high-profile issues, conflicts arise between the Commission and national parliaments.	Low certainty: there may be other evidence of decision-making delays besides conflicts between the Commission and national parliaments. Low uniqueness: the presence of conflicts on high-profile issues can be explained by alternative hypotheses. The evidence was found: the hypothesis passes the straw-in-the-wind test.
C3. OM6. Member states are most responsive to the demands of stakeholders from their own territories.	High certainty: evidence of member states’ representatives interacting with interest groups needs to be found to prove the presence of this interaction. High uniqueness: if found, the evidence cannot be explained by alternative hypotheses. The evidence was found: the hypothesis passes the doubly decisive test.
OM7. Interest groups will be likely to have a negative effect as transmission belts if their members have negative opinions and member states have heterogeneous preferences for EU legislative proposals, which may lead to prolonged legislative decision-making.	High certainty: evidence of the combination of heterogeneous position-taking by interest groups and member states needs to be found to prove its presence. High uniqueness: if found, the evidence cannot be explained by alternative hypotheses. The evidence was found: the hypothesis passes the doubly decisive test.
Y. OM8. Interest groups’ demands influence the preferences of member states and the strategies of EU legislators	Low certainty: there may be other evidence of interest groups’ influence besides the debates of member states in the Council. High uniqueness: if found, the evidence cannot be explained by alternative hypotheses. The evidence was found: the hypothesis passes the smoking gun test.
OM9. The heterogeneous opinions of interest groups can shape decision-making outcomes by impacting the negotiation among member states in the Council	High certainty: evidence of the heterogeneous opinions of interest groups in the consultation documents need to be found to prove its presence. High uniqueness: if found, the evidence cannot be explained by alternative hypotheses. The evidence was found: the hypothesis passes the doubly decisive test.
OM10. Interview and observation data confirm that the interaction effects lead to EU decision-making delay	High certainty: evidence of withdrawal or formal rejection in the specific negotiation needs to be found to prove that the interaction effects lead to EU decision-making delays. High uniqueness: if found, the evidence cannot be explained by alternative hypotheses. The evidence was found: the hypothesis passes the doubly decisive test.

in Appendix A describes the certainty and uniqueness of each piece of expected evidence in these cases. The evidence in this study has a high degree of certainty and uniqueness. Therefore, if the predicted evidence is found, a doubly decisive test enables us to update our confidence in the validity of the hypothesis (Beach and Pedersen 2013). The link between the certainty and uniqueness of the evidence, as well as its verification and disproof in Bayesian logic, is depicted in Figure 2.

4.4. Document Data

This analysis utilizes official documents, media reports, and other materials related to discussions about the proposals, including referendums, advocacy campaigns, and informal meetings. A total of 100 official documents were manually gathered for each case from European Commission databases such as PreLex, EUR-Lex, and the European Parliament’s Legislative Observatory, which track legislative progress and provide cross-references to relevant documents.

As for media data, 300 English-language articles were collected via Factiva, and searches for German and French articles (none found) were conducted to assess coverage saturation. Many English articles were irrelevant, likely due to information imbalance or translation issues in search engines. Random checks for other language materials confirmed minimal additional reporting, and non-informative articles were excluded from the analysis.

4.5. Interview Data

Between November 2020 and January 2023, twenty-one interviews were conducted with experienced representatives from member states, former EU officials, and leaders from interest groups. In the TTIP case, Germany and France were notably active in negotiations, while a broader range of member states and regions, including Denmark, Poland, and the United Kingdom, were involved in the EU ETS case. Respondents from the European Commission, Council of Ministers, and European Parliament provided first-hand evidence, though many were not directly involved in the TTIP negotiations, reducing potential bias.

To compensate for the limited interviews, document analysis and participant observation were used. The interviews included were with officials from EU institutions and representatives from countries like Slovenia and the Netherlands. Twelve respondents were involved in the TTIP case and nine in the EU ETS case. A semi-structured questionnaire was designed, consisting of 26 questions for the TTIP and 20 for EU ETS, focusing on internal mechanisms, stakeholder interactions, strategies, and policy challenges.

The interviews, lasting 30–60 min, were integrated with quantitative data and analyzed using an iterative coding technique. This process identified how political actors interact, focusing on transaction costs and transmission belts. The final analysis grouped interviewee comments into three broad codes linked to key theoretical concepts.

5. Results

5.1. Evaluation of the Evidence on the TTIP

The TTIP negotiations started in 2013, with aims to protect foreign direct investments and liberalize trade between the EU and the United States. The timeline of the TTIP negotiations is presented in

Table A3. Timeline of TTIP negotiations.

Date	Key Events
14 June 2013 Initial legislation	EU directives for the negotiations for a Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US unanimously adopted by the Council on 14 June 2013
February 2013	EU-commissioned ‘ad hoc high-level expert group’ published a paper, highlighting the need for a free-trade area between the European Union and the United States (taken up by President Obama and President of the Commission Barroso)
23 May 2013	European Parliament voted on a resolution for the exclusion of culture and audio-visual services from the negotiation mandate.
14 June 2013	Council agrees on the exclusion of audio-visual services from the mandate in its directives for the negotiation of the TTIP
8–11 July 2013	1st round of negotiations (Washington DC)
11–15 November 2013	2nd round of negotiations (Brussels)
16–20 December 2013	3rd round of negotiations (Washington DC)
January 2014	launch of the EU advisory group
10–14 March 2014	4th round of negotiations (Brussels)
19–23 May 2014	5th round of negotiations (Arlington, Virginia)
July 2014	publication of the EU position papers
14–18 July 2014	6th round of negotiations (Brussels)
October 2014	publication of the EU negotiations mandate
29 September 2014	7th round of negotiations (Chevy Chase, Maryland)
November 2014	Announcement by the EU Commission of further transparency and access to documents for MEPs and the Council
2–6 February 2015	8th round of negotiations (Brussels)
20–24 April 2015	9th round of negotiations (Washington DC)
13–17 July 2015	10th round of negotiations (Brussels)
19–23 October 2015	11th round of negotiations (Miami)
22–26 February 2016	12th round of negotiations (Brussels)
24 April 2016	US President Obama and German Chancellor Merkel commit to completing talks on the TTIP before his term ends in January
25–29 April 2016	13th round of negotiations (New York)
2 May 2016	Greenpeace leaks
24 June 2016	Britain votes to leave the European Union, loses part in TTIP talks
13–15 July 2018	14th round of negotiations (Brussels)
18 January 2019 Final legislation	Recommendation for a final Council decision authorizing the opening of negotiations of an agreement with the United States of America on the elimination of tariffs for industrial goods COM/2019/16

in Appendix A, including key events and the stages of the formal decision-making procedure.

Table A4. Timeline of TTIP-related legislation.

Date	Formal Legislative Procedure
14 June 2013	EU directives for the negotiations of a Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US unanimously adopted by the Council
9 October 2014	EU directives for the negotiations of a Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US declassified and made public by the Council
8 July 2015	European Parliament resolution containing the European Parliament’s recommendations to the European Commission on the negotiations for the Transatlantic Trade and Investment Partnership (TTIP) (2014/2228(INI))
24 April 2016	Regulation (EU) 2016/679 of the European Parliament and of the Council on the protection of natural persons with regard to the processing of personal data and on the free movement of such data and repealing Directive 95/46/EC (General Data Protection Regulation) (Text with EEA relevance)
27 April 2016	Directive (EU) 2016/680 of the European Parliament and of the Council on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention, investigation, detection, or prosecution of criminal offenses or the execution of criminal penalties, and on the free movement of such data, and repealing Council Framework Decision 2008/977/JHA
25 July 2018	Directives for the negotiations with the United States of America for an agreement on the elimination of tariffs for industrial goods
9 April 2019	Council decision authorizing the opening of negotiations with the United States of America for an agreement on conformity assessment
	Directives for negotiations with the United States of America for an agreement on conformity assessment
18 January 2019	European Commission adopted proposals for negotiating directives for its trade talks with the United States: one on conformity assessment and one on the elimination of tariffs for industrial goods (conformity assessment AND industrial tariff elimination)

in Appendix A presents TTIP-related legislation.

The European Commission launched a public consultation and invited all stakeholders to contribute suggestions for the EU-US in the TTIP negotiations from 25 July 2018 to 29 April 2019. Stakeholders showed significant interest in reinforcing transatlantic cooperation. In the consultation response, some interest groups held positive opinions about the Commission’s initiative for better regulatory cooperation and supported the negotiations for a comprehensive and realistic transatlantic deal between the EU and the US (European Commission 2019). However, other interest groups opposed the proposition, especially the proposition that US standards should be presumed to be equivalent to EU regulatory requirements. These opponents urged EU legislators to work with the member states and stakeholders to find a more practical approach to negotiating provisions that enhance legal certainty for EU businesses.

The first important observation is that opponents and supporters of this proposal are also divided among themselves. On the one hand, a few interest groups and civil society organizations expressed their demands via protesting or advocacy campaigns. For instance, more than 150,000 people demonstrated in Berlin against the TTIP in October 2015, and millions of people across the EU voiced their opposition to TTIP deals (Agence Europe 2014, 2015a, 2015b). The protests pushed some authorities to suggest new negotiations in order to allay their constituents’ concerns about environmental standards, food safety, and consumer rights (The Christian Science Monitor 2016). Friends of the Earth Europe said that the TTIP was a massive and unprecedented corporate assault on democracy and the environment, failing to value people above businesses and leaving them with an uncertain future (Agence Europe 2016). European public opinion shifted against the accord over concerns that it prioritizes corporate interests over the rights of citizens (VOA News 2016). On the other hand, criticism from some European politicians and citizens forced a few supporters to abandon their aspirations of concluding a landmark transatlantic trade agreement before Barack Obama’s presidency ended. The European Commission negotiated with Washington on behalf of the EU’s 28 member states and appeared unconcerned about opposition to the TTIP. As a result, the two sides could not reach an agreement on several issues.

The second finding is that all the interviewees acknowledged that the TTIP negotiations aroused significant controversy and raised the transaction costs associated with reaching an agreement during the legislative process due to a lack of preference overlap among member states. Since member states who value national sovereignty highly may prefer intergovernmental negotiations, they allowed conflicting initiatives to dominate the Council’s deliberations. Overall, respondents indicated that national interest groups and civil society organizations held conflicting perspectives on some aspects of the TTIP, and there were disputes between member states (legislative parties such as EP) and stakeholders. As indicated in the statement below, the opposition was fiercest in some member states.

“There are divergent views within our various departments and ministries. Our [Germany] economy minister Sigmar Gabriel has previously stated that the EU-US trade talks have failed because the agreement on the table was unacceptable under the unequal conditions imposed by the US-led discussions, which more favored the US over the EU”

(respondent#4).

“We [France] believed there was no political support in Paris for the TTIP negotiations because they sought a pure, straightforward, and definite halt in order to continue subsequent conversations on a reasonable ground”

(respondent#11).

“Our economic organizations have always demanded that the negotiations should be halted, and the entire process restarted. However, we as a government [Austrian] strive to function as a neutral responder and to ensure that our positions are not dominated by certain interest groups”

(respondent#2).

Despite their portrayal as neutral responders, respondents said they were not able to reconcile internal conflicts beyond cooperating with particular interest groups. In general, both the EP and the Council wanted to approve the TTIP agreement in a transparent manner, even though it was challenging to reach a consensus among various stakeholders and member states. The role of the EU institutions’ leadership is important in this dialog, as they must reconcile the divergent stances of interest groups. The following quotations exemplify this:

“We (the Council) have consistently urged member states and the European Commission to coordinate their efforts to explain the benefits of the agreement and strengthen interaction with national parliaments and civil society organizations. Finally, the Council of Foreign Ministers endorsed the working group’s provisional agreements reached following a lengthy discussion of the TTIP negotiations”

(respondent#2).

“We (European Commission) recognized that successful trade legislation and better implementation are a joint responsibility of the Commission, the Parliament, and the Council”

(respondent#1).

“The TTIP negotiations should achieve an ambitious and balanced agreement that benefits all member states equally. It would neither accept an arrangement that would lower standards, nor would it consent to a proposal that would jeopardize its ability to govern public policy objectives”

(respondent#10).

“The legislative procedure that we shaped was the European Parliament’s democratic responsibility. As a result, our MEPs approved (447 votes in favor, 229 votes against, and 30 abstentions) the inclusion of a new public legal mechanism for resolving disputes between investors and member states”

(respondent#3).

The third observation is that the TTIP negotiations faced significant opposition within key EU member states, particularly Germany and France (see

Table 6. Shifts in public approval rates of TTIP in Germany and France (2014–2016) *.

Year	Germany	France
2014	63%	58%
2015	55%	52%
2016	20%	18%

* Adapted data from surveys by YouGov and Eurobarometer in 2015 and 2016.

). These domestic parliamentary debates offer valuable insights into how national political dynamics influenced the EU’ s approach to the TTIP. Both countries have a long history of skepticism toward certain aspects of globalization, and their parliamentary discussions about the TTIP reflect the broader concerns of their respective political landscapes.

Public approval of the TTIP in Germany began at 63% in 2014 but fell dramatically over the next two years, with disapproval reaching around 80% by 2016. This shift was largely influenced by growing concerns about regulatory standards, the role of multinationals, and ISDS. Similarly to Germany, approval in France started at a relatively high 58% but dropped significantly by 2016. Public opposition rose due to concerns about environmental and food safety standards, with much of the resistance driven by unions and environmental groups.

The domestic political dynamics in Germany and France, as reflected in their parliamentary debates and public opinion shifts, illustrate the profound impact of national interests on EU policymaking. Both governments had to carefully balance the demands of their domestic constituencies with the broader goals of EU integration, eventually leading to the suspension of TTIP negotiations. This highlights how the political environment in key member states can shape not only national policy but also EU-wide decisions on major international agreements.

In sum, the empirical evidence revealed that stakeholders engaged in public consultations and contributed stronger opposing opinions that the TTIP should be changed (Table 1, OM 1). The transmission belt of the interest groups interfered with legislators’ decision-making via their close ties with governments. As a result, the TTIP went through several rounds of negotiations and became stuck in the legislative process. Hence, evidence of the reasoning behind interest groups’ heterogeneity showed that their transmission belts played a role in the TTIP case (Table 1, OM 2). Moreover, all the predicted evidence regarding the transaction costs arising from the heterogeneous preferences of member states was found in this case. Member states with major European economic powers, such as Germany and France, try to politically dominate the political discussion in the Council, which further increased the resistance among other member states and increased transaction costs (Table 2, OM 3). Some member states (Germany, France, Austria, Sweden) joined in a declaration of ministers requesting further debate in the working groups to discuss and clarify high-profile and sensitive issues (Table 2, OM 4). Various TTIP text provisions drew criticism from national stakeholders, which made various member states oppose the proposal in response to these stakeholders’ demands (Table 2, OM 5). This evidence confirms that the presence of heterogeneous preferences of member states on the TTIP negotiations increased the transaction costs (Table 3, OM 6). The European Commission held extensive consultations and closely communicated with co-legislators and had to spend time balancing both the interests of stakeholders and member states’ preferences. The differences in national interests avoided the formation of any consensus, which led to a strategy of attrition from opposition coalitions, as several legislators favored stakeholders’ demands during consultative activities (Table 3, OM 7). Once the Commission submitted a proposal, the EU legislature discussed the dossier and the heterogeneous opinions of stakeholders could shape the decision-making outcomes via impacting the negotiation among member states in the Council (Table 3, OM 8). Finally, interview and observational data explicitly confirmed that the decision-making process took dramatically longer due to the interacting effects of the negative opinions of stakeholders and the heterogeneous preferences of member states (Table 3, OM 9).

Overall, in the TTIP negotiations, divergent interest group preferences led to conflicting positions among key member states (e.g., France and Germany), resulting in multiple rounds of revisions to the draft agreement. This prolonged the negotiation timeline by several months, demonstrating the mechanism of increased transaction costs caused by preference heterogeneity. The TTIP negotiations ultimately stalled, partly due to unresolved food safety disputes. The proliferation of veto points, which were rooted in regulatory divergence, multi-level governance, and stakeholder opposition, highlighted the difficulty of reconciling high-standard EU regulations with U.S. market-driven approaches. This gridlock underscored how deeply entrenched institutional and societal preferences can derail complex trade agreements.

5.2. Evaluation of the Evidence on the EU ETS

The EU ETS directive is a cornerstone of the EU’s climate change policy and its primary tool for cost-effectively decreasing greenhouse gas emissions.

Table A5. Timeline of the EU Emissions Trading System (EU ETS) directive.

Date	Formal Legislative Procedure
23 October 2001	Legislative proposal published
28 November 2001	Committee referral announced in Parliament, 1st reading/single reading
12 December 2001	1st round of debate in Council
4 March 2002	2nd round of debate in Council
25 June 2002	3rd round of debate in Council
10 September 2002	Vote in committee, 1st reading/single reading
10 September 2002	Committee report tabled for plenary, 1st reading/single reading
10 October 2002	1st round of debate in Parliament. Decision by Parliament, 1st reading/single reading
17 October 2002	4th round of debate in Council
27 November 2002	Modified legislative proposal published
18 March 2003	Council position published
27 March 2003	Committee referral announced in Parliament, 2nd reading
11 June 2003	Vote in committee, 2nd reading. Committee recommendation tabled for plenary, 2nd reading
1 July 2003	2nd round of debate in Parliament
2 July 2003	Decision by Parliament, 2nd reading
22 July 2003	Act approved by Council, 2nd reading, final act signed
13 October 2003	End of procedure in Parliament
25 October 2003	Final act published in Official Journal
Final legislation	Directive 2003/87/EC establishing a system for greenhouse gas emission allowance trading system within the EU

presents the timeline of the EU ETS directive.

Experts from think tanks noted that distinct groups had substantial interests in and divisive positions on some aspects of the policy, resulting in conflict. While contentious issues are uncommon, they are more challenging to address, requiring additional time and effort. One expert explicitly acknowledged this situation:

“We reach a quick consensus in 80% of situations, but 20% of the policy issues we address are challenging or extremely difficult, requiring more time and effort”

(respondent#21).

More specifically, the consultations on the amendment of the EU ETS directive include questions about the overall evaluation of this policy and seek input on several ideas for a mechanism to prevent carbon leakage. According to responses, 47% of industry stakeholders believe there is room for emission reduction, while 42% disagree, and 11% expressed no preference for either position (Stefano 2022). In total, 16 public authorities from eight member states favored EU-wide compensation. In contrast, others argued that it would be problematic, given the disparities in the electricity market, and argued instead for continuance of the state aid system. According to one interviewee,

“Stakeholders from the industry expressed concerns about various components of the system. They argued that the proposed new restricted one-off flexibility with the EU ETS for nine member states with a maximum allocation of 100 million ETS credits should be scrapped”

(respondent#18).

Reaching a consensus position on contentious issues may be particularly difficult, as some member states dislike making concessions and are reluctant to give up their core interests. Any negotiation that includes fundamental principles has the potential to become difficult to resolve. While there was widespread support for the EU ETS directive, a majority of member states stressed the importance of addressing key issues regarding the number of carbon leakage groups. Consequently, diverse perspectives were presented for discussion.

First, some member states and their regions (i.e., the Czech Republic, Finland, Thüringer State, Vienna) preferred to continue with the current system with no further revision. In contrast, others (i.e., Poland, Hungary, the Walloon Region, Bavaria, Canary Islands) expressed a preference for developing more categories and emphasized the critical necessity of maintaining international competitiveness and pricing differentials in energy (respondent#6).

Second, Denmark argued the necessity of effective, adequate, and dissuasive penalties to be incorporated into national legislation in order to ensure compliance with the directive. However, this directive does not provide the community with authority to harmonize member states’ criminal laws. It therefore cannot compel member states to include sanctions in their domestic legislation in order to implement the directive (respondent#13).

Third, the Netherlands broadly supported the directive’s aims, particularly the goal of maximum harmonization. However, as reflected in the quote below, the Netherlands supported the inclusion of sanctions in implementing this directive, which has a deterrent impact, to ensure compliance with the directive’s obligations.

Moreover, the Senate of the Czech Republic’s Parliament expressed concern over the diminishing competitiveness of specific issues in the EU ETS directive. The interviewee emphasized that many issues are restrictive and usually capture the attention of only a few member states with the same preferences and positions.

In this situation, a subset of member states that are affected by the policy issue at stake engage actively in the process of decision-making and taking positions. The following quote illustrates this:

“We [the Netherlands] insisted on complying that each member state’s designated administrative or judicial authorities have the authority to impose the penalties outlined in Article 16 (3) in order to ensure conformity with the provisions. Member states’ representatives play a critical role in ensuring consensus among members by considering all perspectives and ensuring that all members take a homogeneous position”

(respondent#5).

“We [the Czech Republic] have urged that the European Commission conduct an in-depth examination of the EU ETS’s operation and efficacy while simultaneously embarking on a fierce debate about alternative strategies for greenhouse gas emission reduction. As a result, the common position incorporated 23 of the 73 amendments proposed by the European Parliament in the first reading”

(respondent#7).

Furthermore, the Council determined that a common position would not change the approach or objectives of the European Commission’s original proposal and it was noted that the European Commission also supported the common position in its current form. The Council and the European Parliament resolved these modalities through co-decision based on the Commission’s proposal on project-based mechanisms, as illustrated below:

“(…) Ok, here is the information that I have learned in this case. The common position contains five amendments that the European Commission did not adopt in its modified proposal. As the accession discussions do not provide for it, agreements must be reached with the applicant nations. The Commission has agreed to this amendment in principle by replacing ‘third parties’ with ‘Parties specified in Annex B of the Kyoto Protocol that have ratified that Protocol’. The amendment section referring to agreements with applicant countries was rejected, as emissions trading was expected to occur in applicant countries because of the scheme’s implementation. The Common Position acknowledges that links should be established only with Kyoto Protocol Annex B Parties and goes further in that direction by stating that ‘agreements’ should be concluded with third countries listed in Annex B to the Kyoto Protocol”

(Respondent#14).

“As far as I know, the Council has typically revised the updated legislative proposal substantially. Among other things, this includes banking allocated amounts, modifying assigned amount units, and national trading systems. Member states are actively engaged in international carbon trading, taxation, and national allocation plans because these high-profile issues raise debates between the European Commission and the national parliament” (respondent#19).

To summarize, the empirical research revealed that interest groups directly intervened in legislative processes by working as a transmission belt in the case of the EU ETS. Interest groups engaged in public consultations and had divergent opinions on the EU ETS’s amendment (Table 1, OM 1 and OM 2). There is evidence that the preferences of different member states prolonged the decision-making process, as the member states debated in the Council on proposals to amend some specific provisions in the legislation (Table 2, OM 4). Evidence concerning the transaction costs arising from the heterogeneous preferences of member states was found in the EU ETS case (Table 2, OM 3). Additionally, on high-profile issues, conflicts arose between the European Commission and national parliaments in the case of the EU ETS (Table 2, OM 5). The evidence for a causal mechanism behind the interacting effects of the heterogeneous positions of member states and negative opinions of interest groups in the EU ETS case is also supported by the fact that there was a lengthy legislative decision-making process (Table 3, OM 7). Member states were most responsive to the demands of interest groups from their own territories in the case of the EU ETS (Table 3, OM 6). Specific enquiries into whether the policy positions of each member state were unambiguously associated with negative stakeholder perceptions also confirmed this in official documents and media reports (Table 3, OM 8). Ultimately, the qualitative evidence presented above confirmed that the effects of interactions between political actors do indeed result in a lengthy EU decision-making process (Table 3, OM 9).

The evidence gathered from stakeholder submissions during the EU-ETS case demonstrated that divergent preferences among influential interest groups triggered strategic disagreements among member states, which were subsequently reflected in prolonged Council discussions. This aligns with the hypothesized mechanism that preference heterogeneity increases transaction costs and delays decision-making. More specifically, the negotiations led to phased compromises, such as tiered free allowance allocations and transitional measures for vulnerable regions. Additionally, the decision-making process required extensive technical working groups, high-level political bargaining, and iterative revisions to the legislation, all reflecting elevated coordination costs stemming from industrial diversity. Heterogeneity in industrial structures raised the coordination costs by fragmenting member states’ preferences, necessitating resource-intensive mediation and delaying consensus. This case underscores how economic diversity within the EU complicates collective action, even within a shared regulatory framework like the EU ETS.

6. Discussion

The protracted decision-making process in the TTIP negotiations stemmed from divergent preferences among EU member states and substantial external stakeholder involvement. These negotiations, involving the EU and the United States, were marked by tensions over differing political and economic priorities. Member states expressed concerns about regulatory standards, labor rights, environmental protections, and potential impacts on domestic industries. Moreover, civil society opposition—led by environmental groups, labor unions, and consumer rights organizations—significantly hindered progress. Public protests and mounting pressure on the European Commission and European Parliament further complicated the process.

By contrast, delays in implementing the EU ETS were primarily driven by the political and economic interests of member states in balancing carbon emission management with climate change mitigation. Despite broad support for environmental objectives, member states often clashed over the distribution of burdens from carbon pricing and allowance allocation. For instance, coal-reliant economies resisted stricter emission targets. The economic implications for key sectors, such as energy and manufacturing, also extended the negotiations. Although stakeholder involvement, e.g., from environmental organizations and industry representatives, was a factor, it was less contentious than in the TTIP negotiations, focusing instead on technical discussions of emission reduction enforcement and implementation.

The decision-making process for the TTIP was characterized by complex, multilayered negotiations involving EU institutions—the European Commission, Council, and Parliament—as well as external stakeholders, including the U.S. government and various interest groups. Conducted over multiple rounds, these negotiations faced repeated delays due to disagreements on critical issues such as regulatory harmonization, investor–state dispute settlement (ISDS), and environmental protections. The trilogue negotiations were further complicated by divergent preferences among EU member states and growing public opposition, culminating in the temporary suspension of talks in 2016.

In contrast, the decision-making process for the EU ETS, while similarly protracted, focused on technical and legal deliberations related to carbon markets, emission reductions, and compliance mechanisms. Consultations primarily involved the European Commission, the Council, and the Parliament, with debates centering on economic and environmental trade-offs, such as the allocation of emission allowances in a way that balanced environmental goals without unduly harming industries. Unlike the TTIP, the EU ETS process was less influenced by public opposition or pressure from civil society, though delays arose due to the need for political compromises among member states regarding emissions targets and allocation methods.

The prolonged decision-making process in the TTIP negotiations ultimately resulted in a stalled agreement, with talks suspended in 2016 amid growing opposition within the EU, particularly in countries like France and Germany. While the EU maintained its commitment to pursuing trade agreements with the U.S., the failure to secure a deal underscored the extent to which public opposition and domestic political dynamics can derail negotiations. This outcome highlighted the challenges of balancing global economic integration with domestic concerns, emphasizing the tension between pursuing economic benefits and safeguarding social, environmental, and regulatory standards.

In comparison, the negotiations surrounding the EU ETS culminated in the establishment of a legally binding emissions trading system, which is now a cornerstone of EU climate policy. Although delayed by political compromises, the resulting framework provided a robust mechanism for carbon pricing and emission reductions. While less contentious than the TTIP, the process still faced challenges, particularly in ensuring that emission reductions were equitably distributed across member states and economic sectors.

The TTIP and EU ETS cases illustrate how delays in the EU legislative process can stem from different sources. The delays of the TTIP were primarily driven by external factors, including public opposition and the complexities of negotiating international trade agreements, which required reconciling economic interests with regulatory standards. In contrast, delays in the EU ETS negotiations were shaped largely by internal political bargaining among member states, reflecting their divergent economic profiles and concerns over the costs of carbon reduction and its impact on domestic industries. The EU ETS was more focused on expert-driven bargaining within industry sectors, with fewer public challenges. However, the TTIP was politically charged, facing protests and resistance from civil society and encountering significant parliamentary veto points due to its perceived societal risks. The salience of environmental issues shaped EU member states’ preferences in the EU ETS, with greater concern about economic impacts in industrial regions. The politicized nature of the TTIP, along with its high media visibility and public risk perception, led to greater divergence in member states’ preferences, as those more exposed to societal concerns were more likely to oppose or demand changes to the agreement. Overall, both the EU ETS and TTIP demonstrate how issue salience, shaped by public visibility and risk perception, directly influenced the aggregation of preferences and the decision-making of member states, though in different ways based on the policies’ contexts.

These examples offer broader insights into the variability of delays across different EU policy areas. Trade policy, as exemplified by the TTIP, is particularly prone to delays due to the involvement of international actors and the challenge of balancing public sentiment with economic objectives. In contrast, environmental policies like the EU ETS often face delays stemming from technical complexities and negotiations among member states over economic impacts. Understanding these differences provides valuable lessons on the political and economic factors that shape the pace of EU decision-making, highlighting how these factors vary between the trade and environmental policy domains.

7. Conclusions

This study provides new insights into the relationship between preference heterogeneity and the length of decision-making procedures in the EU, highlighting the complex interplay between member state preferences, interest groups’ influence, and negotiation dynamics. By systematically tracing causal mechanisms through two in-depth case studies, this research demonstrates that preference heterogeneity operates as a multidimensional factor, extending beyond simple disagreement to include the interaction of diverse interest group demands and the strategic positioning of member states within institutional frameworks.

In conclusion, this study identified the causal mechanism that operated in the cases of the TTIP and EU ETS, as expected. Namely, the negative opinions of interest groups coincided with the heterogeneous preferences of member states in these two cases, and a significantly longer decision-making process was observed in both cases. In other words, the effect of the democratic input of interest groups was found to coincide with the throughput legitimacy of the member states’ position-taking in the Council. Therefore, there is a causal relationship between the preference heterogeneity of political actors and the lengthy decision-making of the EU.

More specifically, the effect of high input from interest groups impacts the decisions made by the member states’ representatives in the Council, which is similar to the interactions between the European Parliament and the Council in terms of specific aspects relating to the use of the first reading for adopting a position. However, the differences are mainly shown in member states’ preferences, which play a critical role at all stages, as the Council determines whether a proposal is designated for approval or rejection. A policy proposal is unlikely to be adopted if the member states put forward opposing views throughout the process of negotiation. Member states’ preferences in the Council are therefore vital for the success of policymaking negotiations, as a proposal will not be approved if they cannot achieve any significant concessions from the Council. Positions and conflict constellations can vary enormously during these negotiations. With rather heterogeneous preferences, negotiations will become more complex, and the decision-making process will become more likely to take longer. However, whether a decision will be made, in the sense of making a new law, is determined by the member states’ willingness to make concessions. As a result, negotiations will be concluded by the negotiators’ competence in handling conflicts.

These findings advance our understanding of the link between preference heterogeneity and procedural length in several ways. First, they illustrate how preference divergence increases transaction costs during negotiations, necessitating additional rounds of consultation, compromise-building, and procedural adjustments. Second, this study highlights the critical role of stakeholder involvement in amplifying or mitigating preference heterogeneity, depending on the alignment of interest groups demands with member state positions. Third, it underscores the importance of contextual factors, such as issue salience and institutional rules, in shaping the extent to which preference heterogeneity affects procedural timelines.

From a theoretical perspective, this research refines existing models of EU decision-making by demonstrating that the causal link between heterogeneity and procedural length is not linear but mediated by dynamic interactions among multiple actors and institutions. By identifying specific mechanisms—such as the escalation of negotiation loops and shifts in coalitional strategies—this study provides a framework for future research to explore the conditions under which preference heterogeneity has the most significant procedural impact.

These findings carry significant implications for EU policymaking. Policymakers should recognize the potential for heterogeneous preferences to delay decision-making and design institutional mechanisms to address such challenges proactively. For instance, enhancing pre-negotiation consensus-building processes, fostering greater transparency in interest group consultations, and leveraging informal networks to reconcile divergent preferences early in the policy cycle could help streamline decision-making without compromising its inclusivity or legitimacy. Furthermore, these findings highlight the importance of considering varying levels of issue salience and their impact on procedural dynamics when formulating legislative strategies.

Moreover, the qualitative results of these two cases may reveal that either the cases are representative of a larger group of cases or they are exceptional cases that behave differently from other cases. There may be alternative choices and better cases to study to avoid the limitations imposed by these two cases and pre-knowing the outcome of the dependent variable. The specific type of political actors most likely to affect the decision-making process could not be identified at this point, as actors with a strategic motivation may misrepresent or conceal their actual preferences or actions, and interviewees may misinterpret the facts to fit their preferred explanations.

While preference heterogeneity and institutional veto points offer critical explanations for decision-making delays in EU trade policy, alternative factors must also be considered. External shocks, like the 2008 financial crisis or the rise in protectionism after 2016, diverted focus towards domestic issues, prolonging negotiations such as the TTIP. Political changes, like shifts in leadership within key EU member states or the U.S., further destabilized negotiations. Additionally, bureaucratic inertia within the EU’s complex governance structure, including lengthy inter-service consultations and overlapping responsibilities between the Commission and Council, exacerbated delays. For example, reconciling technical standards under the TTIP involved coordination among over 40 EU working groups, each with its own timelines.

Comparing the TTIP with the EU–Canada Comprehensive Economic and Trade Agreement (CETA) highlights how public backlash influenced outcomes. While the TTIP faced broad, pan-European opposition, particularly around food safety and ISDS, the CETA encountered more localized resistance, like Wallonia’s objections to dairy quotas. This difference in issue salience—the TTIP’s perceived threat to regulatory sovereignty versus the CETA’s narrower impact—shaped the level of opposition. The CETA’s negotiators could isolate dissent through side agreements, whereas the TTIP’s systemic controversies caused it to become entrenched in institutional veto points.

This analysis shows that EU trade policy delays are multi-causal. The TTIP’s collapse resulted from the interplay of preference heterogeneity and veto points, while the CETA’s success demonstrated how adaptive bargaining and less polarized conditions can overcome gridlock. The length of the EU decision-making might, in contrast, be the result of the informal strategic interplay among the European Parliament, the Council, and the European Commission during the negotiations (Rasmussen and Reh 2017; Laloux 2020; Perarnaud and Arregui 2022). Therefore, future research should explore how external shocks, bureaucratic structures, and public mobilization interact in shaping EU decision-making.