What is a State Party

The European Economic Area (EEA), Switzerland and the North

The European Economic Area (EEA) was established in 1994 with the aim of extending the EU provisions on the internal market to the countries of the European Free Trade Association (EFTA). Norway, Iceland and Liechtenstein belong to the EEA. Switzerland is a member of the EFTA, but does not belong to the EEA. The EU and its EEA / EFTA partners (Norway and Iceland) are also linked through various “Northern Policies” and forums focusing on the rapidly developing northern reaches of Europe and the entire Arctic.

Legal basis

For the EEA: Article 217 of the Treaty on the Functioning of the European Union (Association Agreement).

For Switzerland: Insurance agreement from 1989, bilateral agreement I from 1999, bilateral agreement II from 2004.


A. Goals

With the European Economic Area (EEA) the internal market of the EU is to be extended to the countries of the European Free Trade Association (EFTA). The current EFTA countries do not want to join the EU. The EU internal market regulations will become part of the legal provisions of the EEA / EFTA states as soon as they have consented to their adoption. The administration and management of the EEA will be set up between the EU and the EEA / EFTA countries in a two-pillar structure. Decisions are taken by joint EEA bodies (the EEA Council, the EEA Joint Committee, the EEA Joint Parliamentary Committee and the EEA Advisory Committee).

B. Background

In 1992, the then seven EFTA states negotiated an agreement that enabled them to participate in the ambitious project of the internal market of the European Community that was launched in 1985 and concluded at the end of 1992. The Agreement on the European Economic Area (EEA) was signed on May 2, 1992 and entered into force on January 1, 1994.

However, the number of EEA / EFTA states soon declined: Switzerland did not ratify the agreement due to a negative referendum on this issue, and Austria, Finland and Sweden joined the European Union in 1995. Only Iceland, Norway and Liechtenstein remained in the EEA. The ten new Member States that joined the European Union on May 1, 2004 automatically became part of the EEA, as did Bulgaria and Romania, which joined the Union in 2007, and Croatia, which joined in 2013 [1].

In June 2009 Iceland applied for EU membership as a way out of the 2008 global financial crisis. The Council accepted Iceland's request on June 17, 2010 and negotiations began in June 2011. In March 2015, however, the Icelandic government stated in a letter addressed to the Council of the European Union that "Iceland should not be considered a candidate country for EU accession". Although the government has not officially withdrawn the application, the EU is not currently treating Iceland as a candidate country.

C. The scope of the EEA

The EEA goes beyond free trade agreements in the traditional sense, as it extends the full rights and obligations of the EU internal market to the EEA / EFTA states (with the exception of Switzerland). The EEA includes the four freedoms of the internal market (free movement of goods, people, services and capital) as well as related policy areas (competition, transport, energy and economic and monetary cooperation). The agreement includes horizontal policies that relate solely to the four freedoms: social policies (including health and safety at work, labor law and gender equality); policy measures in the areas of consumer protection, the environment, statistics and company law and various accompanying policy measures, for example in the area of ​​research and technical development, which are not based on the EU acquis or binding legal acts but are implemented through cooperation measures.

D. The borders of the EEA

The EEA Agreement does not create binding rules for all areas of the internal market or for other political measures under the EU treaties. In particular, its binding regulations do not concern:

  • the common agricultural policy and the common fisheries policy (although the agreement contains provisions on trade in agricultural and fishery products),
  • the customs union,
  • the common commercial policy,
  • the common foreign and security policy,
  • justice and home affairs (although all EFTA states are members of the Schengen area) or
  • the Economic and Monetary Union (EMU).

E. Institutions and mechanisms of the EEA

1. Adoption of EU legislation

New texts relating to the EU's internal market are reviewed by an EEA Joint Committee made up of representatives from the EU and the three EEA / EFTA states. This committee meets once a month and decides which legal provisions and, in general, which EU legal acts (actions, programs, etc.) are to be incorporated into the EEA Agreement. The relevant legal provisions are then formally adopted by including the respective legal acts in the list of protocols and annexes to the EEA Agreement. Several thousand legal acts have already been integrated into the EEA Agreement in this way. An EEA Council, made up of representatives of the Council of the EU and the foreign ministers of the EEA / EFTA states, meets at least twice a year. It sets the political guidelines for the Joint Committee. The EEA Agreement contains provisions that are intended to facilitate the contributions of the EEA / EFTA states in different phases of the EU legislative process before new legal provisions are enacted (decision-making).

2. Implementation

If an EU legal act has been integrated into the EEA Agreement, it must be transposed into national law by the EEA / EFTA states (if this is required by national law). A simple government decision may be sufficient for this, but parliamentary approval may also have to be obtained. Implementation is a formal task; At this point in time, only purely technical adjustments are possible.

3. Monitoring

If internal market regulations have been extended to the EEA / EFTA states, their implementation and application is monitored by the EFTA surveillance authority and the EFTA Court of Justice. The EFTA Surveillance Authority keeps an internal market scoreboard in order to be able to follow the implementation of the legal provisions in the EEA states.

4. Role of Parliaments

Both the European Parliament and the national parliaments of the EEA / EFTA states are closely involved in monitoring the EEA Agreement. In accordance with Article 95 of the Agreement, an EEA Joint Parliamentary Committee has been set up which meets twice a year. These meetings are alternately organized by the European Parliament and the national parliaments of the EEA / EFTA states; The committee is chaired alternately for one year by a member of the European Parliament and a member of parliament from one of the EEA / EFTA countries. Each delegation consists of twelve members. Members of the Swiss Federal Assembly attend the meetings as observers. All EU legislation applicable to the EEA is subject to scrutiny by the EEA Joint Parliamentary Committee, whose members have the right to put written and oral questions to the members of the EEA Council and the EEA Joint Committee and to express their views in reports or Set out resolutions. The same procedure applies to monitoring the implementation of legislation. Every year the JPC adopts a resolution on the annual report of the Joint Committee on the functioning of the EEA Agreement, in which it sets out its views on the progress made in adopting EU law and the backlog and recommendations for the proper functioning of the internal market.


As an EFTA member, Switzerland took part in the negotiations on the EEA Agreement and signed it on May 2, 1992. Immediately afterwards, on May 22, 1992, the Swiss government submitted an application to join the EU. However, since the Swiss citizens voted against membership in the EEA in a referendum on December 6, 1992, the Swiss Federal Council put an end to the country's efforts to join the EU and the EEA. Since then, Switzerland has further developed its relations with the EU through bilateral agreements in order to maintain its economic integration with the EU. After the initiative against immigration in February 2014, bilateral relations were strained. This initiative has challenged the principles of free movement and the internal market that underpin these relationships. The Swiss Parliament passed the Aliens Act on December 16, 2016, thereby implementing the result of the 2014 referendum in a way that is less drastic. It has thus paved the way for the normalization of relations between the EU and Switzerland.

The EU and Switzerland have signed more than 120 bilateral agreements, including a free trade agreement in 1972 and two large packages of sector-specific bilateral agreements which, at the time of signature, brought much of Swiss law into line with that of the EU. The first package of sector-specific agreements (known as “Bilateral Agreements I”) was signed in 1999 and entered into force in 2002. These seven agreements cover the issues of free movement and mutual market opening [2]. In 2004, another package of sector-specific agreements (Bilateral Agreement II) was signed, which gradually came into force between 2005 and 2009. These agreements are essentially related to the strengthening of economic cooperation and the expansion of cooperation in the areas of asylum and freedom of travel in the Schengen area [3].

The agreements have strengthened economic ties while creating a complex and sometimes incoherent network of commitments. Bilateral agreements have to be updated regularly and do not have the dynamic character of the EEA agreement. There is also no monitoring regime or effective dispute settlement mechanisms. To solve these problems, negotiations between the EU and Switzerland on an institutional framework agreement began on May 22, 2014. The negotiations sought to resolve several difficult issues, ranging from the conditions for EU service providers in Switzerland to the role of the Court of Justice in resolving disputes. Negotiations on the institutional framework agreement were concluded at the political level on November 23, 2018. The Federal Council was unable to approve the final text, however, as Switzerland was concerned that the "accompanying measures" [4] and the adoption of the EU acquis in the area of ​​free movement had not been adequately reflected. It then initiated a comprehensive internal consultation with the responsible committees of the Federal Assembly, political parties, cantons, social partners and the academic world / science, which will serve as the basis for the decision whether the agreement should be submitted to the Swiss Federal Assembly for approval or not. During the consultation, which ended in April 2019, a number of questions were raised, on which the Swiss side requested further clarification. The EU stands ready to provide further clarification provided that the text will not be renegotiated and has asked the Swiss side to provide a list of specific issues that require clarification.

Concerns about the free movement of people between Switzerland and the EU were raised during the consultation. On September 27, 2020, Switzerland held a referendum on the termination of the agreement with the EU on the free movement of persons under the auspices of the Swiss People's Party (SVP). Almost 62% of voters rejected the SVP's initiative. The EU hopes that the outcome of this vote will pave the way for the swift signature and ratification of the institutional framework agreement.

Politics in relation to the north

The EU is actively involved in various political activities and forums focusing on the rapidly developing northern reaches of Europe and the entire Arctic, including in particular:

  • the “Northern Dimension”, which has served as a common policy for the EU, Russia, Norway and Iceland since 2007. This policy has resulted in successful sector-specific partnerships for cooperation in the Baltic and Barents Sea regions. The Northern Dimension comprises a parliamentary body, the Parliamentary Forum on the Northern Dimension, of which the European Parliament is a founding member;
  • the Council of the Baltic Sea States (CBSS); this was founded in 1992 after the dissolution of the USSR by the EU and the neighboring states. All the member states of the Baltic Sea Council participate in the Parliamentary Conference of the Baltic Sea States (BSPC), of which the European Parliament is a member;
  • the cooperation in the Barents Sea region, which brings together the northern regions of Finland, Norway, Sweden and the north-western regions of Russia. This cooperation takes place within the framework of the sub-state Barents Regional Council, the intergovernmental Euro-Arctic Barents Council (of which the European Union is also a member) and a parliamentary conference (of which the European Parliament is a member);
  • Arctic affairs: EU policy on the Arctic is based on communications from the Commission / European External Action Service (EEAS) (2008, 2012 and 2016), Council conclusions (2009, 2014, 2016 and 2019) and European resolutions Parliament (2011, 2014 and 2017). The last resolution of the European Parliament on an integrated EU policy for the Arctic was adopted on March 16, 2017. On July 20, 2020, the European Commission and the EEAS jointly launched a public consultation on the way forward for the European Union's Arctic policy. The consultation will seek input on the strengths and weaknesses of the existing policy with a view to possible updating the concept. The EU has been participating in meetings of the Arctic Council since 2013, but the Arctic Council has still not decided on the EU's application for formal observer status in 2008. The European Parliament is a member of the Conference of Arctic Parliamentarians;
  • it also takes part in the annual meetings of the Nordic Council, to which it is regularly invited. In addition, the delegations of the European Parliament and the West Nordic Council (consisting of MEPs from the Faroe Islands, Greenland and Iceland) meet once a year.
[1] The agreement on Croatia's participation in the EEA has been provisionally applied since April 2014 and will formally enter into force once ratification by all member states has been completed.
[2] The seven agreements are in the areas of free movement of persons, air and land transport, trade in agricultural products, technical barriers to trade, public procurement and research cooperation.
[3] These agreements relate to Switzerland's participation in Schengen and Dublin, agreements on taxation of interest, processed agricultural products, statistics and the fight against fraud, participation in the EU MEDIA program and the European Environment Agency, and Swiss financial contributions on economic and social cohesion in the new EU member states.
[4] "Accompanying measures": a series of measures that were unilaterally introduced by Switzerland in 2006 to protect its labor market. These include reporting obligations for EU service providers, contributions from EU operators to cover the costs of the Swiss tripartite commissions, the obligation for EU companies to provide deposit guarantees and certain sanctions. The EU believes that these measures are incompatible with the free movement of people and constitute a barrier to trade and services.

María Álvarez López / Ausra Rakstelyte