EFTA EEA définition

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European Free Trade Association (EFTA)

• Establishment of EFTA: At the initiative of the United Kingdom, the seven non-EEC states of Denmark, Norway, Austria, Portugal, Sweden, the United Kingdom and Switzerland sign the Convention establishing the European Free Trade Association (EFTA) in Stockholm on 4 January 1960.

• The objective of the Association was to liberalise trade among its Member States, and the Convention thus contained basic rules regarding free trade in goods and related disciplines (This is intended as a counterbalance to the EEC and EURATOM).

• The Convention was updated in 2001/2002. Important new provisions included the free movement of persons, trade in services, movement of capital and protection of intellectual property.

• The EFTA Member States (currently Switzerland, Iceland, Liechtenstein and Norway) also developed close trade relations with the EU, as reflected in the EEA Agreement and the EU-Swiss Bilateral Agreements.

• The EFTA States jointly negotiate free trade agreements (FTAs) with partners outside the European Union in order to strengthen their competitive position and increase market access for their products. Today, EFTA has 29 FTAs covering 40 countries and territories outside the EU.

• However, EFTA does not envisage political integration. It does not issue legislation, nor does it establish a customs union.

• That’s why, the EFTA States are not obliged by the EFTA Convention to conclude preferential trade agreements as a group. They maintain the full right to enter into bilateral third-country arrangements.

• Areas covered by the EFTA Convention:

• Trade in goods
• Services and investment
• Land and air transport
• Intellectual property rights
• Government procurement
• Movement of persons, social security and mutual recognition of diplomas
• Technical barriers to trade
• Competition, public undertakings and monopolies, and state aid

• Resources:

• Short Overview of the EFTA Convention

• The European Free Trade Association - Parliament UK

Switzerland and the European Union

• Switzerland is not a member state of the EU;

• Switzerland is not a member of the EEA (Swiss electorate’s rejection of the European Economic Area (EEA) in 1992)

• Switzerland conducts its relations with the EU on the basis of bilateral sectoral agreements.

• This bilateral approach enables Switzerland to adopt a policy based on openness and cooperation with its European neighbours.
• This approach is the European policy instrument that best allows Switzerland to safeguard its interests with regard to the EU.
• The electorate has endorsed the bilateral approach in various referendums.

• Switzerland laid the foundations for this economic exchange in 1972 when it concluded the Free Trade Agreement with what was then the European Economic Community (EEC), the predecessor of the European Union.

• This abolishes import and export duties and eliminates quotas for industrial products.

• On 21 June 1999, Switzerland and the EU sign the seven agreements in the areas of free movement of persons, technical barriers to trade, public procurement, agriculture, overland transport, air transport and research. Known as “Bilateral Agreements I”, they form an overall package and are legally linked to one another. They give Switzerland gradual access to the EU internal market and facilitate the free movement of persons and participation in EU research programmes.

• Switzerland and the EU sign the second set of bilateral agreements on 26 October 2004, intensifying economic cooperation and extending it to include areas such as security, asylum, the environment and culture.

• On 30 March 2005, the agreement on processed agricultural products comes into force. This part of the second round of bilateral agreements abolishes customs duties and export subsidies for a wide range of food products.

• Overall, Switzerland and the EU have concluded around 20 main agreements and some 100 secondary agreements in several stages.

• Of the ‘four freedoms’ that characterise that market, the Swiss–EU law does not include the free movement of capital, though it should be added that, to a certain extent, the Union’s rules on the free movement of capital also apply to the movement of capital between the EU and third countries.

• Financial services are a notable omission to the bilateral agreements. Attempts to negotiate a financial services agreement (FSA) giving access to the single market stretch back to the early 1990s but have faced significant resistance from Brussels.

• In lieu of an FSA, Swiss banks and their overseers have followed four routes into the single market: passporting from an EU subsidiary, equivalence recognition, cross-border services and reverse solicitation

• The bilateral agreements are based on mutual recognition of the equivalence of legislation, as in the case of the dismantling of technical barriers to trade, or on the full incorporation into the national legal order of the entire body of EU law (‘acquis communautaire’).

• However, Switzerland does not automatically adopt further amendments to these agreements. Instead, it is free to decide whether to do so – in line with its own approval procedures.

• In fact, the EU-Swiss agreements have created a complex and sometimes incoherent network of obligations, which are not easy to sustain. Bilateral agreements are updated regularly. Unlike the EEA Agreement, the nature of the bilateral agreements with Switzerland is static, given that there are no proper mechanisms to adapt the agreements to evolving EU legislation, nor are there any surveillance arrangements or effective dispute settlement mechanisms.[pic 2]+[pic 3][pic 4]

• Extra Resources:

• Switzerland and the EU – a sectoral relationship
• How Switzerland's financial sector copes outside the EU single market
• The major bilateral agreements Switzerland–EU
• Switzerland and the European Union
• Bilateral agreements Switzerland–EU

European Economic Area (Norway/Liechtenstein/Iceland and the EU)

• The Agreement on the European Economic Area, which entered into force on 1 January 1994, brings together the EU Member States and the three EEA EFTA States — Iceland, Liechtenstein and Norway — in a single market, referred to as the "Internal Market".

• The EEA Agreement allows for EEA EFTA participation in Internal Market relevant Community programmes and agencies, albeit with no right to vote. The EEA-EFTA states also make financial contributions towards the reduction of economic and social disparities in the EEA.    

• The EEA Agreement extends the application of EU Internal Market law to three of the EFTA States. Relevant legislation concerns the so-called "four freedoms", i.e. the free of movement of goods, services, capital and persons, as well as certain horizontal and flanking policies.

• The EEA Agreement also covers cooperation in other important areas such as research and development, education, social policy, the environment, consumer protection, tourism and culture. It also enables the three EEA EFTA states to participate in various EU programmes.

• A central principle of the EEA Agreement is homogeneity, which means that the same rules and conditions of competition apply to all economic operators within the EEA. To maintain homogeneity, the EEA Agreement is continuously updated and amended to ensure that the legislation of the EEA 3 The EEA Agreement

• What is the EEA Not? The EEA Agreement does not cover the following EU policies:

• Common Agriculture and Fisheries Policies (although the Agreement contains provisions on various aspects of trade in agricultural and fish products);
• Customs Union;
• Common Trade Policy;
• Common Foreign and Security Policy;
• Justice and Home Affairs (even though the EFTA countries are part of the Schengen area); or
• Monetary Union (EMU).

• Resource:

• EEA Policy Areas 

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