What is EFTA? EFTA Review

Overview

The European Free Trade Association (EFTA) is also known as the small free trade zone, the Group of Seven, or the Seven Alliance. It is a free trade zone consisting of the United Kingdom, Sweden, Norway, Switzerland, Austria, Denmark, and Portugal. In order to compete with the European Economic Community, the seven countries signed the Convention Establishing the European Free Trade Agreement on January 4, 1960, and the European Free Trade Association was formally established on May 3 of the same year. The headquarters is located in Geneva. The purpose of the EFTA is to achieve free trade in industrial products and expand agricultural product trade among member states within the alliance area; to ensure that trade between member states is carried out under fair competition conditions; to develop and expand world trade and gradually eliminate trade barriers. Its main tasks are: to gradually eliminate tariffs and other trade barriers on industrial products within member states to achieve "free trade"; to maintain different tariff rates for industrial products from other countries; to expand trade in agricultural products; and not to seek any form of European political integration.

background

In the 1950s, Western Europe was working to achieve a faster and more complete economic unity. Some European countries also made plans to establish an intergovernmental organization outside the OEEC. They proposed closer economic cooperation among countries and the creation of a strong central agency to jointly achieve this goal.

When the European Coal and Steel Community was established, it hoped that Britain would join the organization. However, Britain relied on the trade support of the Commonwealth countries and the United States, and believed that it would lose its sovereignty and the right to control its domestic economy, so it finally refused to join. A few years later, the European Coal and Steel Community was reorganized into the European Economic Community, and its economy developed very rapidly, and it also emerged from the shadow of World War II.

Britain regretted it very much and applied to join the European Economic Community several times, but French President Charles de Gaulle believed that Britain's joining would affect France's leadership in the organization, and was dissatisfied with Britain's reneging and wanting to join, so he refused to allow Britain to join. Britain had no choice but to form the European Free Trade Association with Portugal, Switzerland, Austria, Denmark, Sweden and Norway, hoping to achieve the same results as the European Economic Community, but it was not as expected, and it was always far away from the six countries.

history

It was officially established in May 1960 and is headquartered in Geneva.

In March 1961, Finland became an associated country.

Iceland officially joined in March 1970.

In January 1973, the United Kingdom and Denmark withdrew and joined the European Economic Community.

In January 1986, Portugal withdrew and joined the European Economic Community.

On December 31, 1994, Austria, Sweden and Finland withdrew and joined the European Union.

Organization

The European Trade Union is mainly composed of the Council, the Standing Committee and the Secretariat. The Council is the highest authority, composed of ministers or permanent representatives of each member country, and meets twice a year. The chairman is rotated among the member countries for a term of six months. Decisions on assuming new obligations must be passed by unanimous consent, and other issues must be passed by majority. The Standing Committee has committees such as origin and tariff experts, trade experts, budget, economy, technical barriers to trade, and advisory committees.

The Advisory Committee is composed of employers, trade union representatives and individuals designated by each country, and meets before each Council meeting. The Secretariat is responsible for handling daily affairs, with one Secretary-General and one Deputy Secretary-General. In addition, there is also a Supervisory Bureau, which was established in January 1993 and officially started work on January 1, 1994. It is located in Brussels and is responsible for supervising the compliance of EFTA member states with the European Economic Area Agreement.

Enterprises from EFTA countries must comply with the competition principles of the European Economic Area; On January 24, 1994, the member states signed an agreement to establish the court, which is located in Geneva and consists of five judges. Its duties and powers are similar to those of the European Court of Justice.

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