Introduction EFTA and the EEA Agreement

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1 Introduction EFTA and the EEA Agreement EEA Seminar 13 September 2018 Hege Marie Hoff Deputy Secretary-General EFTA Secretariat 1 13 September 2018

2 What is EFTA? > The European Free Trade Association (EFTA) is an intergovernmental organisation set up for the promotion of free trade and economic integration to the benefit of its four Member States: Iceland, Liechtenstein, Norway and Switzerland. > The Association has responsibility for the management of: a) The EFTA Convention; b) The Agreement on the European Economic Area (the EEA Agreement); and c) EFTA s worldwide network of free trade agreements (FTAs).

3 Ministers of the four EFTA member states at Ministerial meeting in Sauðárkrókur, Iceland, 25 June 2018

4 EFTA Council EFTA Secretariat s three functions EFTA Standing Committee Intra-EFTA EFTA at four Geneva Brussels Free Trade Relations EFTA at four Geneva EEA Agreement EFTA at three Brussels and Luxembourg (Statistics)

5 Organisation 1 September 2018: New Senior Management

6 Organisation Other EFTA institutions: EFTA Court (Luxembourg) EFTA Surveillance Authority (Brussels) Financial Mechanism Office (Brussels, managing the EEA/Norway Grants)

7 EFTA s quest for European integration > 1952 European Coal and Steel Community > 1957 Treaty of Rome (EEC) > 1960 European Free Trade Association (EFTA) Austria, Denmark, Norway, Portugal, Sweden, Switzerland, United Kingdom; Finland (associated1961, full member 1986), Iceland (1970), Liechtenstein (originally represented by CH, full member in 1991) > 1973 Denmark and the UK leave EFTA for the EC > 1973 EFTA-EU bilateral free trade agreements > 1986 Portugal leaves EFTA for the EC > 1987 EC Single European Act > 1994 European Economic Area > 1995 Austria, Finland and Sweden leave EFTA for the EU > 1999 Swiss-EU bilateral agreements > 1995 Schengen Agreement > 2001 EFTA countries part of Schengen

8 The Challenges of the 1980s Decline in European economic growth in the 1970s US and Japanese dominance in the global economy Numerous physical, technical and fiscal barriers to trade Failure to meet the objectives of the «four freedoms» The EC response: How to complete the Internal Market Commission White Paper : Completing the Internal Market by the end of 1992 Strengthening the four freedoms and supporting policies Decisions by qualified majority voting The Single European Act (1987)

9 The Birth of the EEA First EFTA-EU Ministerial meeting, Luxembourg Declaration on a dynamic "European Economic Space" Commission President Delors offers the EFTA countries «a new, more structured partnership» Fall of the Berlin Wall EEA negotiations finalized (signature) The EFTA members Austria, Finland, Norway and Sweden negotiate membership in the EU Switzerland rejects the EEA Agreement in referendum Entry into force of the EEA Agreement Austria, Finland and Sweden join the EU Remaining EEA EFTA States: Iceland, Liechtenstein, Norway

10 Objectives and principles of the EEA > establishing a dynamic and homogenous European Economic Area, based on common rules and equal conditions of competition and providing for the adequate means of enforcement at the judicial level, > Which means: Extending the internal market to the participating EFTA States > Legal homogeneity > Incorporation of all relevant legislation at the conclusion of the Agreement and by the establishment of an institutional set-up for incorporation of new legislation > Institutional set-up for surveillance and judicial litigation

11 Essence of the EEA > The Agreement on the European Economic Area or the EEA brings together the EU and three of the four EFTA states; Iceland, Liechtenstein and Norway in the Internal Market. > These 31 European countries operate in a single market consisting of over 500 million consumers, allowing goods, services, capital and people to move freely. > The EEA Agreement guarantees equal rights for individuals and businesses across all 31 countries. > Meaning a Norwegian can start a business in France, > A Polish student can study in Iceland > and a Liechtensteiner can work in Croatia.

12 Reconciling two different models of cooperation The EU model Supranationality: transfer of competence and sovereignty Institutions with defined roles in the decision-making processes: Commission European Parliament Council Important concern: Preserving decision-making autonomy of the EU The EFTA model Intergovernmental cooperation: No transfer of competence, no common policies Decisions taken by consensus between the Governments Important concern: Preserving sovereignty

13 2019 EEA 25 years in force Continuously updated to ensure common rules for the free movement of goods, capital, services and people across the EEA.