The Agreement creating the European Economic Area(EEA) entered into force on 1 January 1994. It allows the EEA EFTA States (Norway, Iceland and Liechtenstein) to participate in the Internal Market on the basis of their application of Internal Market relevant acquis. All new relevant Community legislation is dynamically incorporated into the Agreement and thus applies throughout the EEA, ensuring the homogeneity of the internal market.
The EEA Agreement is concerned principally with the four fundamental pillars of the Internal Market, “the four freedoms", i.e. freedom of movement of goods, persons, services and capital. But also “flanking policies” such as social policy, consumer protection, and environment policy may be covered. The EEA Agreement does not cover agriculture and fisheries.
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 Agreement covers most of the substance of the EU's relations with the EEA EFTA States. The updating of the Agreement through the incorporation of new relevant Community legislation generally runs smoothly and thousands of legal acts have been extended to the EEA to date.
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http://www.efta.int/sites/default/files/images/publications/efta-at-a-glance-may-2015.pdf
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:
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The EFTA Convention;
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The Agreement on the European Economic Area (the EEA Agreement); and
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EFTA’s worldwide network of free trade agreements (FTAs).
The EFTA Convention
The EFTA Convention regulates the free trade relations between the four EFTA Member States and provides the
legal framework for EFTA as an organisation. It covers trade in goods and services and includes areas such as
investment and the free movement of persons.
The EEA Agreement
The EEA Agreement brings together the Member States of the European Union (EU) and three of the EFTA States
– Iceland, Liechtenstein and Norway – in a single market, also referred to as the ”Internal Market”. The Agreement
provides for the inclusion of EU legislation on the free movement of goods, services, capital and persons in the
legal systems of the three EEA EFTA States and establishes common rules on competition and state aid. It further
covers cooperation in key areas such as research and development, environment, education and social policy.
Switzerland is not a member of the EEA but has a series of bilateral agreements with the EU.
EFTA’s Free Trade Network
Cross-border trade and investment are central to the economic growth and dynamism of the EFTA countries,
which are highly integrated in the global economy and are leading international investors. Together they
ranked twelfth in world merchandise trade and seventh in world commercial services trade in 2013. The EFTA
States have developed one of the largest networks of FTAs, which today spans over 60 countries and territories,
including the EU. Combining the contractual frameworks with the EU and the FTAs with non-EU countries, some
80% of EFTA’s total merchandise trade is conducted under preferential arrangements.