The European Commission is the EU civil service. With headquarters in Brussels, it runs day-to-day EU affairs, draws up proposals for common EU policies for the consideration of the Council of Ministers and the European Parliament. It implements their decisions and administers the EU budget and special funds such as the regional and social funds and development aid to poor countries. The Commission is managed by the commissioners - one from each country from 2005, each serving a five-year term. Previously Britain, France Germany, Italy and Spain had two commissioners each. However even with just one Commissioner per country there are not enough "prestige" portfolios to go around and the top portfolios of trade, agriculture economic and foreign affairs are always subject to much horse-trading between ambitious former politicians who make up the bulk of commissioners.
The Commission President is Portugal's former Prime Minster Jose Manuel Barroso who takes over from Italy's Romano Prodi in November as head of the new 25-member Commission. The British Commissioner, Peter Mandelson takes over the prestigous trade portfolio and replaces outgoing commissioners Chris Patten and Neil Kinnock.
The Council of Ministers represents governments of the Member States. It is a forum of member states cabinet ministers who travel from their national capitals to Council meetings. The Council has a small secretariat in Brussels but ministers also meet regularly in Luxembourg and in cities designated by the country holding the rotating six-month Council presidency.
The Council of Ministers holds general decision-making powers. Decisions are often a hard-won compromise of different member state's interests. The Council is also responsible for coordinating the EU's common foreign policy, security, police and judicial matters.
The European Council is the summit meeting of heads of state of government of the Memberstates. At least two such summits are held each year in June and December hosted by the member state which has the Council presidency during that period. Further summit meetings are held in Brussels.
Extraordinary European Councils may be held such as the one in February 2003 to discuss Iraq.
The role of the European Council is to provide vision for the future development of the EU, issue guidelines for cooperation in foreign and other affairs, and to settle sensitive issues beyond the scope of Council of Ministers.
The European Parliament represents the EU's citizens and is directly elected by them every five years. It's members are known as MEPs. The Parliament's once modest powers have grown with some powers in tandem with the Council of Ministers over legislation, although it is held at arms length over sensitive issues, only able to provide an "opinion". It works out the annual EU budget together with the Council of Ministers and has the power to veto the budget. It also has the power to dismiss Commissioners en masse. There are currently 732 MEPs in seven main political groupings with over 30 non-attached MEPs.
The European Court of Justice in Luxembourg ensures that European law is understood in the same way across the EU and settles disputes between EU institutions and the member states. Although reaching a judgment can be a lengthy process, judgements are binding on all national courts and can force changes in national legislation. This has happened in the case of intellectual property, competition law and employment law. More than 10,000 cases have been heard since the Court was set up in 1952.
The European Central Bank, based in Frankfurt, Germany was set up in 1999 virtually replace national central banks in the eurozone. It sets interest rates to maintain the purchasing power of the Euro, keeping inflation in check, and monitors economic benchmarks which should be met by Eurozone countries to keep the mechanism stable. Its president is Jean-Claude Trichet of France.