What is the European Economic Area (EEA) Agreement
The European Economic Area (EEA) Agreement is an agreement made in 1992 that brings together the European Union member countries and the three EEA/EFTA states – Iceland, Liechtenstein and Norway – into a single market. The purpose of the agreement is to strengthen trade and economic relations between the countries by removing trade barriers and imposing equal conditions of competition and compliance with the same rules.
BREAKING DOWN European Economic Area (EEA) Agreement
The EEA agreement requires the inclusion of EU regulations covering the “four freedoms” – free movement of goods, services, persons and capital – throughout the member states. It also covers cooperation in other areas such as research and development, education, social policy, the environment, consumer protection, tourism and culture, collectively known as “flanking and horizontal” policies.
The agreement does not require the inclusion of EU's 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, or the monetary union (EMU).
What Is the difference between EEA and EU?
Although the two are closely related, the EEA and the EU are not the same. The EEA agreement is related to the single market and the laws relevant to it, while the EU is not just economic, but also political. All regulation that EEA countries have to comply with is formed by the EU, which effectively means that the EEA/EFTA countries do not have a say in forming the laws they are required to implement. The EEA countries also have to make financial contributions to the EU, though smaller than the contributions of an EU member.
- Republic of Cyprus
- Czech Republic
- The United Kingdom**
*Countries only in the EEA, not the EU.
**In 2016 the UK voted to leave the European Union and, effectively, the EEA agreement.