What is the Single Market

The European Single Market is an entity created by a trade agreement between participating states. These states include the members of the European Union (EU), as well as four non-EU countries that are members of the European Free Trade Association (EFTA).

The Single Market created a unified trading territory that functions without border regulations, such as tariffs, which typically apply to trade between countries. The Single Market allows the unrestricted movement of goods and services, as well as capital and people throughout the territory or bloc.


The European Single Market, originally known as the Common Market, has its foundations in the former European Economic Community (EEC) which was established by the Treaty of Rome in 1957. The first significant change to the original treaty was in 1986, with the Single European Act (SEA). In 1992, the European Union was formed, encompassing the former EEC.

Primary goals of the Single Market include stimulating economic growth across the region, improving quality and availability of goods and services, and reducing prices. In aiming to meet these objectives, the following benefits have been provided:

  • A larger ‘domestic’ market with more resources.
  • Greater specialization within the region.
  • A powerful trading presence in the international arena.
  • Increased economic integration among members.

Another major function of the Single Market is the setting and enforcing of measures that ensure high safety and quality standards, as well as environmental protection.

Drawbacks to the Single Market

Being a part of the Single Market means that an individual country does not have the right to refuse to sell products which are deemed acceptable in other countries in the bloc. There have been instances where a country has challenged EU law as the country sought to ban the sale of a product deemed to be harmful. France, for example, succeeded in getting permission to ban the sale of Red Bull drinks on the basis that one of the main ingredients was harmful to health. This ban remained in place for twelve years until it was over-ruled on the grounds that there was no proof for this health risk.

A country is also unable to limit the immigration of nationals from other countries in the bloc, and at the time of the announcement of “Brexit,” regaining control of immigration appeared to be a key issue for the United Kingdom (UK). EU leaders made it clear that the UK retaining the benefits of free trade depended on the continued rights of EU nationals to work and reside in the UK.

Leadership of the Single Market

The Single Market is governed by the European Commission which is responsible for monitoring the application of EU laws and acting on non-compliance under the Single Market Act. The Commission also collects data for the purpose of evaluating policy implementation, and assessing areas in which policy development is required.

Economic reports are also presented based on analysis conducted by the Commission. These reports investigate the results of the application of regulations in various sectors, and provide a basis for future direction. Reports also pinpoint areas in which progress has been made, as well as those which have encountered obstacles.