The European Union’s institutional structure and the institutions
The institutions of the European Union form a complex and unique polity and, in determining whether or not this structure and the law making powers granted to each respective institution are inherently undemocratic, it is vital to define what is meant by the term ‘democratic’. In his Gettysburg address Abraham Lincoln referred to a government which was ‘of the people, by the people, for the people’  and it is by this criterion that democracy is often judged. These principles are reflected in having equal access to power and in being equal before the law. It must be considered not only whether law making powers are granted to elected persons, but also whether the balance of power between institutions within the European Union promotes the ideals of democracy. 
Firstly, the democratic nature of the European Union must be measured by the extent to which its institutions (particularly those with executive and legislative power) are elected bodies of persons. The European Union is governed by seven institutions; the European Parliament, the European Council, the Council of the European Union (the Council), the European Commission, the Court of Justice of the European Union, the European Central Bank and the Court of Auditors.  The first four of these hold the executive and legislative power of the European Union. Of these four institutions, the only one directly elected is the European Parliament whose 736 members are elected every 5 years; each citizen in each member state having the right to vote. Seats are subsequently assigned to member-states in accordance with their population, and for the purpose of sustaining some balance and proportionality, no member-state takes in excess of 99, however no less than 5.  In addition to this, the European Council consists of the heads of state and the Council consists of representatives for each member, who have been elected by the citizens of their own country. In contrast, the Commission is an unelected body consisting of persons nominated by each member state rather than elected by its citizens.
In assessing the extent to which the appointment of persons to each institution is democratic it is easy to argue that only the members of the European Parliament are truly democratically elected as they are chosen by a ballot which includes all members of the polity and which pertains only to the European Union. Those members of the European Council and the Council who are elected by the citizens of their state are elected to their roles within their own countries rather than to those which they must perform within the supra-national sphere, thus undermining the democratic nature of their appointment; can one have an electoral mandate if that mandate does not relate absolutely, or even primarily, to the role which one goes on to perform? However, this is perhaps too simplistic a view as the European Union ought to protect and serve the interests of not only its individual citizens but its member states, who may have priorities which diverge from those of the persons who populate them, or indeed other states, but which nevertheless deserve representation. The Council is an appropriate forum in which these views may be aired and presents an environment where the smaller states will not be marginalised as in the Parliament where they have few MEPs.
Secondly, the legislative process must be considered alongside the appointment procedures of the institutions in order to determine whether or not the distribution of powers of law-making within the European Union is democratic. Legislative processes vary according to the nature of the laws proposed, however the ordinary legislative procedure is known as co-decision. Article 294 TFEU provides that firstly the Commission must submit a legislative proposal to the Parliament and Council and the Parliament must determine its position on the wording of the act. If the Council approves the Parliament's wording then the act is adopted; if not, it adopts its own position and passes it back to Parliament with explanations. At the additional reading, the act is implemented if Parliament accepts the Council's text. Parliament may reject the Council's text, leading to a failure of the law, or they may modify it and pass it back to the Council to continue the process of negotiation. Co-decision procedures and the power of veto held by the European Parliament in the adoption of legislation have made this institution very powerful as the Union’s legislature. Although other bodies have rights of proposition and consultation, these cannot ultimately overrule the Parliament if it decides not to adopt a certain law.  Consequently, as the Parliament wields this legislative power and is a directly elected body, the legislation process can be described as democratic. However, the Commission’s role in providing the impetus for law-making may be criticised as unrepresentative of the people as the members of this body are unelected.
The treaties outline other procedures, including the consultation and consent procedures used in specific sensitive areas. These involve the same institutions as the ordinary procedure but require them to function via a different process. The consultation procedure, which is used for legislation concerning internal market exemptions and competition law is particularly concerning to those promoting democratic legislation as it provides that the Council consult the Parliament but that they are not bound by the latter’s comments in enacting laws. This effectively removes the only wholly elected body from the decision process.  Consequently, whether or not the law-making of the European Union is democratic depends on the procedure adopted. This discrepancy in itself appears to offend the principles of equality and fairness which the concept of democracy embodies.
Thirdly, the democratic nature of the structure of the European Union must be considered in a broader sense. Balance of power and the opportunity for public impetus, which are fundamental to a government ‘for the people’  , would not be possible, were all state power to reside in the hands of a few people or one institution. To this end, Montesquieu argued that if government is to be for the common good, there must be a separation of powers.  Despite this, according to Steiner,  the European Union functions through a system of institutional balance. The idea of this system did not originate with the EC, but represented a fundamental concept in republican ideals of democracy, as it was held to prevent tyranny and sectional self-interest.  This can indeed be seen to be the method through which institutional actors are prevented from becoming too powerful, as the European Court of Justice has itself explicitly rejected the idea that the EU operates according to the doctrine of separation of powers in France, Italy and the United Kingdom v. The Commission.  Consequently it must be asked whether indeed the relationship between the institutions of the EU is one of separation of powers, a combination of separation and balance, or even as a lack of balance altogether if it is to be determined whether this structure is one which embodies the ideals of democracy.
Operation of the institutions through balance (though not separation) can be discerned through study of the workings of the European Parliament, the Council and the Commission. Although the European Union’s judiciary is reasonably self-contained in the European Court of Justice, its legislature and executive operate in a unique and cooperative manner, which serves to balance the powers of each body. The co-decision procedure,  which, since its introduction in 2003 and the extension of its remit in the 1999 Treaty of Amsterdam and 2003 Treaty of Nice, has become the main medium through which the legislative process is undertaken, has ensured that no single institution has absolute power over the introduction of new legislation. Parliament, although holding a significant role in the legislative process, has no free-standing right to initiate legislation, this being held by the Commission,  and no absolute right to approve legislation once drafted, this procedure requiring approval by the Council also. Hence, an institutional balance, which prevents one institution from gaining too much authority over the others, can be seen to operate in the arena of legislature. In addition, executive power is shared as, although the Commission is traditionally spoken of as the European Union’s executive,  its President is nominated by the Council,  subject to approval of the European Parliament, and the Council has the power to alter members of the Commission when acting unanimously.  This relationship demonstrates a necessary interaction between the bodies of the European Union which unavoidably creates a situation in which they must act as ‘balances’ upon one another.
An institutional balance, if it is to function effectively, must include ‘checks’ as well as ‘balances’ and these can be seen to exist between the various European Union institutions through the powers of inspection which they operate over one another. For example, the European Parliament must appoint an Ombudsman to receive complaints concerning ‘maladministration in the activities of Community institutions and bodies’,  and the Commission must appear in Parliament and answer its questions  as well as providing it with an annual report. In addition, the Council and Parliament check the Commission’s budget reports.  Consequently, a system of institutional balance can be seen in the manner in which the European Union institutions are regulated by one another. It is important to note that the checks and balances discussed above are embodied in Treaty Articles with the result that they are enforceable against any body which attempts to increase its power beyond the levels stipulated in the Treaty.
However, rather than constituting a straight-forward system either of institutional balance or separation of powers, it is possible that the European Union institutions function on the basis of a constantly shifting combination of the two. Douglas-Scott suggests that it is conceptually and practically very difficult to separate the functions of government and most modern legal systems fail to do this. For example, in Britain the separation of powers refers mainly to the independence of the judiciary as the legislature and the executive are closely related.  It is difficult to transfer such a doctrine to the European Union, but this does not suggest that elements of it are not present. It could perhaps be argued though that, rather than a separation of powers based on the institutions of the European Union itself, a separation can be seen to lie in the separation of national governments and EU institutions,  through the principles of supremacy, subsidiarity and competence. This embodies the tension between the federalist approach of European unity and the functionalist approach which responds to the immediate needs of the state, rather than aiming to stem the conflict between legislature, executive and judiciary. 
Separation or balance of institutional power, and therefore democracy so far as the prevention of a concentration of power is concerned, could, on some readings of the Treaties, be seen to be non-existent in any form. A balance or separation implies discord, whereas the mission of the European Union specifically aims towards ‘cohesion and solidarity,’  and the Union often seeks to present itself as a unitary polity, founded on the rule of law and human rights.  Although this image is supported by the European Court of Justice in its ‘constitutional’ case law,  this vision is undermined by a closer look at institutional structures as explored above. As Curtin suggests, the ‘picture is one of fragmentation rather than unity, of bits and pieces rather than singleness.’  This fragmentation however, does not necessarily indicate the promotion of democracy through a balance of power; it merely reveals a lack of cohesion. It has been highlighted by Shapiro,  that unelected committees, agencies and working groups play a substantial role in the decision-making of the European Union at every level. This means that, although most autonomous agencies, such as the Office for Internal Market Harmonization, have no formal coercive powers, the important part which they play undermines the functions of the institutions and the democracy that they, particularly the elected Parliament, proclaim to embody. This means that the workings of the institutions of the European Union do not necessarily correspond to a formal reading of the Treaties, and therefore no official balance of power can be established. This problem is further exacerbated by the numerous different processes in place for the resolution of different issues, which means that even if an institutional balance and a clear democratic structure can be discerned, it is shifting, inconstant and often unclear. These problems have led some academics to characterise the relationship between the institutions as a ‘garbage-can model’  rather than as an adherent to a recognised method of political equilibrium.
Democracy may only function effectively if single institutions are prevented from monopolising power and thus government continues to be ‘by the people’ rather than by the individual. By necessitating co-operation, the structure of the European Union promotes this ideal and attempts to preclude autocracy. Nevertheless, the shifting dynamics of power which are evident in the model mean that any institutional balance is rendered irregular and unpredictable. This irregular structure may be characterised as undemocratic as it fails to ensure that power is never concentrated in the hands of one institution. In addition, the structure of the European Union is only democratic if certain checks and balances operate at all times to prevent the few exercising unmitigated authority over the many. However, it is clear that, while there are limitations in place over the authority of each institution, these limitations are not clearly defined and do not always operate effectively to promote and protect government ‘by the people’ and ‘for the people’ rather than government in the interests of those working within the institutions themselves.
Finally, in determining whether or not the structure of the European Union is democratic it is critical to assess the overall purposes for which this structure was created. It is easy to become embroiled in discussion of the political mechanisms and the complex interactions between the various bodies which comprise this supra-national body, and to thereby lose sight of the aims which those mechanisms and interactions were created to fulfil. The motivations of the European Union must be considered alongside the methods by which they have been implemented in order to properly understand whether or not it is a democratic organisation. As Norbert Reich argues, ‘Community law is principle-orientated not rule-orientated’  (Reich’s emphasis). What is vital to the question of democracy is not only the idea of equality and fairness which the European Union endeavours to promote,  but the recognition that each of the Member States plays an important and supportive role in the structure which embodies these aims.  The European Union recognises that the Member States, and their political and legal structures, must interact with the political and legal structures of the Community. Consequently, the methods of law-making within the EU and the doctrines of direct and indirect effect,  enable each state to maintain some elements of autonomy in the implementation of Community law. This means that, although as seen above the democratic nature of the institutions of the European Union themselves may be called into question, the Member States and their elected officials serve as another form of representation for the citizens of each member.
Overall it is clear that the European Union strives to embody and promote ideals of democracy, through both its principles of equality and its recognition of each individual Member State. However, it is not possible to state without significant qualification that it has achieved this objective. Government, if it is to be ‘of the people, by the people, for the people,’  must be elected by universal suffrage and must be controlled by a system of checks and balances which prevent single men or institutions from exercising total power. It is evident that, although the European Parliament is elected, the institutions which are not and the shifting balance of power between them undermine the Community’s commitment to democracy. The principles extolled by the European Union and its various Treaties suggest that the intention is honestly to create laws ‘for the people’; however the structure and competencies of its institutions prevent these laws from being made ‘by the people.’ It is evident that it will always be difficult to embody a democratic ideal in such a large and diverse polity; however, if the current situation is to be improved, the elected members of the European Parliament must be given greater authority and the same mechanisms of legislation must be used in all policy areas to ensure that a constant balance of power is achieved.