What is 'Supranational'

Supranational is an international organization or union in which member states transcend national boundaries or interests to share in the decision making and vote on issues pertaining to the wider grouping.

The European Union and the World Trade Organization are both supranationals. In the European Union, each member votes on policy that will affect each member nation. The benefits of this construct are the synergies derived from social and economic policies along with a stronger presence on the international stage.

BREAKING DOWN 'Supranational'

For an organization to be supranational, it must operate in multiple countries. While applicable to multinational businesses, the term is more often used in reference to government-style entities as they often have regulatory responsibilities within their standard operation. This can include the creation of international treaties and standards for international trade.

Even though a supranational organization may be highly involved in setting business standards and regulation, it does not necessarily have any enforcement authority. Instead, enforcement falls on the individual governments with participating businesses.

While the primary focus of most supranational organizations is to ease trade between member nations, it may also have political implications or requirements. For example, it may require that all member nations participate in certain political activities, such as public election for leadership.

Other Areas of Concern

Aside from basic trade, supranational organizations may be involved in other activities designed to promote and international standard. This can include items involved with food production, such as agriculture and fisheries, as well as those involved in environmental or energy production concerns. Organizations concerned with education are also included, as well as those focused on providing various forms of aid or assistance to countries or areas in need of certain goods or services.

Certain organizations are involved in areas with significant political impacts for the member nations. This includes issues relating to arms, including acceptable treatment of prisoners of war, and nuclear power and other nuclear capability development.

The United Nations

The United Nations is a well-known organization that is supranational in nature. It, and its subsidiaries, are made of groups of member nations and are designed to ease and standardize certain activities across international borders.

The Olympics

An example of a supranational organization that is less involved regulation of international activities are the Summer and Winter Olympics, controlled by their associated committees. These organizations create standard regarding which events are included in the competition, as well as scoring standards for the various events. The selection of the host city is made by international members of the committee.