EU law affects governments and populations and has direct influence on the lives of citizens. With the governance turn and ever more complex decision-making in Brussels rule formulation takes increasingly often the form of soft law. Lacking binding nature and enforcement it is far from certain whether, and if so when, why and how soft law affects the performance of the EU multilevel system. This paper presents a conceptual framework to explain the use and performance of soft law in the EU. It develops a soft law cycle that starts with the creation of soft law at the EU level, the use or non-use of soft law at national level and feedback effects at EU level. Employing lenses of contemporary legal scholarship on soft law and political science insights on public policy analysis, for each of the stages in the cycle we provide a set of testable hypotheses on usage and performance of soft law. The paper is part of a multiannual, interdisciplinary project providing a systematic empirical analysis of soft law in the EU multilevel system in two member states (France and Germany), seven policy fields and over a time span of fifteen years.