It's not what ICAO had in mind when ATC was invented, but it seems to work without major incidents.
I think the problem is that the high traffic density that we find in some parts of Europe these days is not what ICAO had in mind either.
I'm a great believer in the concept of standardisation through SARPs - fundamentally it's worked well for 60+ years - but the ICAO framework is showing weaknesses for what we have in Europe today. Even the Regional Supplementary Procedures are slow to reflect today's environment (largely because of the administrative processes required, I suspect).
However, the Communication Failure Procedures used in Europe were amended about 5 years ago to address some of the concerns raised in this thread. I'm not saying these are right or good - just that they are there!