The deepening of the Community has led to a crucial change in the position of the regional and local authorities in the overall structure. The most striking features of this new role of the subnational level are: their increasing direct involvement and integration under general and specific Community policies; their growing participation in the EC decision-making process as a contribution to the elimination of the democratic deficit and to the achievement of greater closeness to the citizen within the framework of a subsidiary structure of the European Union; the need, given the challenges posed by the internal market, for more regional and local initiative to help improve the quality of these levels as locations. How far the territorial authorities will be able to play this new, enlarged role will very much depend on the quality of their institutional infrastructure and their ability to take action. The comparative analysis reveals, however, that the tasks of the territorial authorities in the various member states differ significantly as regards their constitutional and democratic position. In many places regional and local authorities do not have enough independence (powers, financial resources). They are thus unable to respond adequately to the new requirements arising from deeper European integration. As there is also growing locational competition among the territorial authorities in the internal market, they need sufficient powers of their own to shape their economic future. Their ability to play an active part in the shaping of their own economic and social development against the background of their specific circumstances will very largely determine their future prospects in the internal market. The fact is, however, that central government occupies a dominant position in all policies relevant to the regions, especially in the least developed areas of the Community. This democratic deficit at regional and local level is an obstacle to the economic development of these regions. Almost half of the 175 NUTS II regions are today prepared for and capable of playing an active part within the European Union's institutional structure. The other EC regions do no more than enforce EC legislation applicable to them, without being able to influence the formulation and implementation of relevant Community policies. They lack the powers, organization, financial resources and, as a rule, administrative structures to play a democratically legitimized part in the formulation of European objectives. As a rule, they also fail to meet the requirements for democratic legitimized representation on the Committee of the Regions. Those who do not have a political mandate can hardly speak on behalf of a region's citizens. Administrative and political structures at regional and local level are underdeveloped, there are not enough opportunities for democratic decision-making and employment of funds, and the flow of information, the external representation of interests and thus the efficiency of activities at regional level are inadequate. In many regions of Europe the organizational structure and decision-making process no longer meet the new requirements arising from the internal market and the Treaty on European Union. Most member states of the Union do not consider it opportune to promote, encourage or tolerate independent initiatives and activities in the regions and municipalities. The majority of regions thus have little or no opportunity today to take the initiative themselves with a view to prompting endogenous developments. Centralism, the democratic deficit and the lack of regional powers are proving to be a major obstacle to development in the weakest regions of the EC. The Community should pay at least as much attention in the future to the removal of these handicaps as to a further increase in financial transfers to the weak regions. The differences in the powers and status of the territorial authorities are also highly significant in the context of the qualitative implementation of the subsidiarity principle in the European Union. Territorial authorities capable of taking action are crucial if solutions which are close to the citizen and have his approval are to be found when Community policies are formulated and implemented. This is particularly true of the EC structural policy. In these circumstances, the territorial authorities must also be integrated more closely into the Community decision-making process. The Treaty on European Union takes an important step in the right direction by creating the Committee of the Regions (Articles 198a to 198c). The diversity and lack of comparability of the powers of the territorial authorities in the member states and the different images they have of themselves will not exactly facilitate the Committee's work. Through its work the European Parliament has made a decisive contribution by drawing the EC institutions' attention to the importance of the regional and local authorities' new role. A number of resolutions and the conferences of regional and local authorities it has organized give practical expression to its desire to do what it can to strengthen the territorial authorities in the Community context, while preserving its own privileges.