ElectronicjournalofcomparaTiveLaw,vol.9.1(january2005),<http://www.ejcl.org/> the 2002 Commission Action plan and the 2003 Interinstitutional agreement on better law- making the determination to resort, where possible, to self-regulation, co-regulation and soft law instruments and mechanisms has been confirmed 2. 4 The underlying aim of enhancing the Union's legitimacy Application of the notions of flexibility and differentiation and of the principles of subsid iarity and proportionality is not an end in itself; this is considered to contribute to enhancing the effectiveness, legitimacy and transparency of Union action. The White Paper on European Governance makes this explicitly clear in respect of differentiation of the Union's modes of governance and legal instruments. 35 It is thus understood that this enables rulemaking closer to the citizen and realisation of the aims of the Lisbon strategy respectively contributing to the legitimacy and the effectiveness of EU action. Focusing here on the aim of enhancing the Union's legitimacy, we should first establish what is actually meant by legitimacy before we can consider what effects the use of self-regulation, co regulation and soft law may have on this The notions of democracy'and"rule of law are of crucial importance in this respect Even if the European legal system constitutes a legal order in its own right 36 it is clear that it is based on these notions, just like the national legal systems represented in it. 7This means that not only the existence and division of European power must be acceptable to the citizen but also the exercise thereof. 38 Democratic organisation and exercise of power is usually considered to be the basis for this acceptability and hence for the democratic legitimacy of the Union. So, enhancing legitimacy is primarily understood as an effort to increase the influence, control and participation of the European Parliament and, more generally, of the citizen in the European decision-making process Yet, acceptability of-the exercise of -state power requires more than that, and in particular reliance on the rule of law. The essence of a state, or any other ent ity vested with the exercise of government power based on the rule of law, is that government action is bound by the law. This can be said to require, on the one hand, governing sub lege and, on the other, governing per lege. 39 Governing sub lege does not only mean governing on the basis of the law, i.e. that there is a competence-conferring legal basis(the principle of legality), it also means governing within the boundaries of the law, that is in conformity with certain principles on which a constitutional state is based and which indicate the limits to the powers to be exercised, with a view to ensuring the freedom and liberty of citizens Governing per lege means that power should be exercised through the adoption of laws, inter See also the Commission's work programme for the White Paper on European Govemance, SEC(2000) 15477def,p.4 36 Case 26/62 Van Gend en Loos[1963]ECR 3 Cf. Article 6 TEU P Pescatore, Les exigences de la democratie et la legit im ite de la Communaute Europeenne, Cahiers Dr Euro10(1974),505-506 H. Gribnau, ' Legaliteit en legitim iteit. Fiscale rechtsvorming in de democratische rechtsstaat,, Ned. Tijdschrift voor Bestuursrecht(2001)1, 16Electronic Journal of Comparative Law, vol. 9.1 (January 2005), <http://www.ejcl.org/> 9 the 2002 Commission Action plan and the 2003 Interinstitutional Agreement on better law￾making the determination to resort, where possible, to self-regulation, co-regulation and soft￾law instruments and mechanisms has been confirmed. 2.4 The underlying aim of enhancing the Union’s legitimacy Application of the notions of flexibility and differentiation and of the principles of subsidiarity and proportionality is not an end in itself; this is considered to contribute to enhancing the effectiveness, legitimacy and transparency of Union action. The White Paper on European Governance makes this explicitly clear in respect of differentiation of the Union’s modes of governance and legal instruments.35 It is thus understood that this enables rulemaking closer to the citizen and realisation of the aims of the Lisbon strategy, respectively contributing to the legitimacy and the effectiveness of EU action. Focusing here on the aim of enhancing the Union’s legitimacy, we should first establish what is actually meant by legitimacy before we can consider what effects the use of self-regulation, co￾regulation and soft law may have on this. The notions of ‘democracy’ and ‘rule of law’ are of crucial importance in this respect. Even if the European legal system constitutes a legal order in its own right,36 it is clear that it is based on these notions, just like the national legal systems represented in it.37 This means that not only the existence and division of European power must be acceptable to the citizen but also the exercise thereof.38 Democratic organisation and exercise of power is usually considered to be the basis for this acceptability and hence for the democratic legitimacy of the Union. So, enhancing legitimacy is primarily understood as an effort to increase the influence, control and participation of the European Parliament and, more generally, of the citizen in the European decision-making process. Yet, acceptability of - the exercise of - state power requires more than that, and in particular reliance on the rule of law. The essence of a state, or any other entity vested with the exercise of government power based on the rule of law, is that government action is bound by the law. This can be said to require, on the one hand, governing sub lege and, on the other, governing per lege. 39 Governing sub lege does not only mean governing on the basis of the law, i.e. that there is a competence-conferring legal basis (the principle of legality), it also means governing within the boundaries of the law, that is in conformity with certain principles on which a constitutional state is based and which indicate the limits to the powers to be exercised, with a view to ensuring the freedom and liberty of citizens. Governing per lege means that power should be exercised through the adoption of laws, inter 35 See also the Commission’s work programme for the White Paper on European Governance, SEC(2000) 1547/7 def, p. 4. 36 Case 26/62 Van Gend en Loos [1963] ECR 3. 37 Cf. Article 6 TEU. 38 P. Pescatore, ‘Les exigences de la démocratie et la légitimité de la Communauté Européenne’, Cahiers Dr Euro 10 (1974), 505-506. 39 H. Gribnau, ‘Legaliteit en legitimiteit. Fiscale rechtsvorming in de democratische rechtsstaat’, Ned. Tijdschrift voor Bestuursrecht (2001) 1, 16