. The mutual cooperation of governments of the Member States (MS) enable the MS to maintain their sovereignty on an equal basis. The MS establish their ties through treaties, treaties that might lead to the shift of sovereignty of a MS towards the central EU governance, however this applies to the same extent to all parties of the integration process. The intergovernmental side of EU enables its states to represent the interests of the governments and helps to promote economic cooperation and regional development. This encouraged innovation in and amongst the MS, creates strong and safe economic environment on one hand, but can also cause problems to small local industries, as they have to take on the challenges the global economic arena brings along. On the other hand it can be well argued that the European Union has all sorts of supra-national powers that it exercises regularly. The European Union is a well-developed institution, that includes a powerful commission (led by R. Prodi), an effective court (ICJ, ECHR) and a parliament (EP) that has been elected directly by the citizens of MS. So in some sense the EU has already developed its organs to act as an independent federal state, however the accountability of these organs is not yet fully introduced therefore the EU can not yet be considered a federal state. The MS still have their full national governance only it is in accordance with the fundamental principles of the European Union. To determine whether or not the EU will gradually evolve into a supranational state, one has to look at the current status of statehood. If the European Union is to become a federal (or supranational) state, it will have to meet the requirements for statehood. The principles of statehood were laid down in the Montevideo Convention of 1933. In examining the criteria it quickly becomes clear, that the European Union already has a core territory on which it can exercise full jurisdiction; the populati...
