European Free Trade Association

European Free Trade Association

Infobox Geopolitical organisation
conventional_long_name = European Free Trade Association (EFTA)
linking_name = the European Free Trade Association
symbol_type = Logo
image_symbol = EFTA logo.svg

map_caption =
org_type = Trade bloc
membership_type = Member states
membership = ISL
admin_center_type = Secretariat
admin_center = Geneva, Switzerland
languages_type = Official languages
languages = German, French, Norwegian, and Icelandic
leader_title1 =
leader_name1 =
established = 3 May 1960
established_event1 = nowrap|EFTA Convention
established_date1 = 4 January 1960
area_rank =
area_magnitude =
area_km2 = 529,600
area_sq_mi = 204,518
percent_water =
population_estimate = 12,660,623
population_estimate_rank =
population_estimate_year = 2007
population_density_km2 = 100.6
population_density_sq_mi = 59.82
population_density_rank =
GDP_PPP = $567.5 billion
GDP_PPP_rank =
GDP_PPP_year = 2007 (IMF)
GDP_PPP_per_capita = $44,828
GDP_PPP_per_capita_rank =
GDP_nominal = $743.3 billion
GDP_nominal_rank =
GDP_nominal_year = 2007 (IMF)
GDP_nominal_per_capita = $58,714
GDP_nominal_per_capita_rank =
currency = Icelandic króna, Norwegian krone, Swiss franc
currency_code = ISK, NOK, CHF
time_zone = WET / CET
utc_offset = +0 / +1
time_zone_DST = WEST / CEST
DST_note =
utc_offset_DST = +1 / +2

The European Free Trade Association (EFTA) is a European trade bloc which was established on 3 May 1960 as an alternative for European states who were either unable to, or chose not to, join the then-European Economic Community (now the European Union).

The EFTA Convention was signed on 4 January 1960 in Stockholm by seven states. Today only Iceland, Norway, Switzerland, and Liechtenstein remain members of EFTA (of which only Norway and Switzerland are founding members). The Stockholm Convention was subsequently replaced by the Vaduz Convention.

This Convention provides for the liberalisation of trade among the member states. Three of the EFTA countries are part of the European Union Internal Market through the Agreement on a European Economic Area (EEA), which took effect in 1994; the fourth, Switzerland, opted to conclude bilateral agreements with the EU. In addition, the EFTA states have jointly concluded free trade agreements with a number of other countries.

An important development was the conclusion by Switzerland in 1999 of a set of bilateral agreements with the European Union covering a wide range of areas, including movement of persons, transport and technical barriers to trade. This development prompted the EFTA States to modernise their Convention to ensure that it will continue to provide a successful framework for the expansion and liberalization of trade among them and with the rest of the world.

The EFTA UPDATE on 1 June 2002. The main areas in which the Convention has been modernised include: Mutual recognition of conformity assessments; Intellectual property rights; Movement of persons, social security and mutual recognition of diplomas; Investment and services; Land and air transport; Public procurement; Agriculture;

Membership history

thumb|left|300px|">legend|#008000|EFTA member stateslegend|#66FF99|Former member states, now EU member statesIts original members were the United Kingdom, Denmark, Norway, Sweden, Austria, Switzerland and Portugal. During the 1960s these countries were often referred to as the Outer Seven, as opposed to the Inner Six of the then-European Economic Community. [ [,9171,874317,00.html Now, the Seven and a Half - TIME ] ]
Finland became an associate member in 1961 (becoming a full member in 1986), and Iceland joined in 1970. The United Kingdom and Denmark joined the European Communities in 1973 (together with Ireland), and hence ceased to be EFTA members. Portugal also left EFTA for the European Community in 1986. Liechtenstein joined in 1991 (previously its interests in EFTA had been represented by Switzerland). Finally, Austria, Sweden and Finland joined the European Union in 1995 and hence ceased to be EFTA members.

Current members

General Secretaries

General Secretaries of EFTA:

*1960-1965: flagicon|United Kingdom Frank E. Figgures
*1965-1972: flagicon|United Kingdom Sir John Coulson
*1972-1975: flagicon|Sweden Bengt Rabaeus
*1976-1981: flagicon|Switzerland Charles Müller
*1981-1988: flagicon|Norway Per Kleppe
*1988-1994: flagicon|Austria Georg Reisch
*1994-2000: flagicon|Iceland Kjartan Jóhannsson
*2000-2006: flagicon|Switzerland William Rossier
*2006-present: flagicon|Norway Kåre Bryn


EFTA is governed by the EFTA Council and serviced by the EFTA Secretariat. In addition, in connection with the EEA Agreement of 1992, two other EFTA organisations were established, the EFTA Surveillance Authority and the EFTA Court.

EEA-related institutions

The EFTA Surveillance Authority and the EFTA Court regulate the activities of the EFTA members in respect of their obligations in the European Economic Area (EEA). Since Switzerland is not an EEA member, it does not participate in these institutions.

The EFTA Surveillance Authority performs the European Commission's role as "guardian of the treaties" for the EFTA countries, while the EFTA Court performs the European Court of Justice's role for those countries.

The original plan for the EEA lacked the EFTA Court or the EFTA Surveillance Authority, and instead had the European Court of Justice and the European Commission were to exercise those roles. However, during the negotiations for the EEA agreement, the European Court of Justice informed the Council of the European Union by way of letter that they considered that giving the EU institutions powers with respect to non-EU member states would be a violation of the treaties, and therefore the current arrangement was developed instead.


The EFTA Secretariat is headquartered in Geneva, Switzerland. The EFTA Surveillance Authority has its headquarters in Brussels, Belgium (the same location as the headquarters of the European Commission), while the EFTA Court has its headquarters in Luxembourg (the same location as the headquarters of the European Court of Justice).

Portugal Fund

The Portugal Fund was established in 1975 when Portugal was still a member of EFTA, to provide funding for the development and reconstruction of Portugal after the Carnation Revolution. When Portugal left EFTA in 1985, the remaining EFTA members decided to nonetheless continue the Portugal Fund, so Portugal would continue to benefit from it. The Fund originally took the form of a low-interest loan from the EFTA member states to Portugal, to the value of 100 million US dollars. Repayment was originally to commence in 1988, but EFTA then decided to postpone the start of repayments until 1998. The Portugal Fund has now been dissolved by the Member States.

International conventions

EFTA also originated the Hallmarking Convention and the Pharmaceutical Inspection Convention, both of which are open to non-EFTA states.

Relationship to the European Economic Area

The EFTA members, except for Switzerland, are also members of the European Economic Area (EEA).

International Relationships

EFTA has several free trade agreements with non-EU countries as well as declarations on cooperation and joint workgroups to improve trade. Currently, the EFTA States have established preferential trade relations with 20 States and Territories, in addition to the 27 Member States of the European Union.

Free Trade Agreement
*South Korea
*Republic of Macedonia
*Palestinian National Authority
*Southern African Customs Union (Botswana, Lesotho, Namibia, Swaziland, South Africa)

Currently negotiating with Thailand and the Gulf Co-operation Council (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, United Arab Emirates)

Declarations on Cooperation
*Mercosur (Brazil, Argentina, Uruguay, Paraguay)

Joint workgroups

Trade News
*8 May 2008 EFTA and Algeria hold 3rd round of free trade negotiations
*5 May 2008 Free Trade Agreement between EFTA and SACU
*24 April 2008 EFTA and the Gulf Co-operation Council (GCC) Finalize Free Trade Negotiations
*25 July, 2008: EFTA interested on Free Trade Agreement with Malaysia [ [ EFTA & Hong Kong keen on FTA with Malaysia, says Muhyiddin] ]

Future of EFTA

Norwegians have rejected in referendums to join the EU on two occasions. At the time of the first referendum (1972) their neighbours the Kingdom of Denmark joined. The second time (1994) two other Nordic neighbours, Sweden and Finland joined the EU. The two last governments of Norway have been unable and unwilling to advance the question, as they have both been coalition governments consisting of both proponents and opponents.

Iceland is not likely to join the EU in the near future due to political indifference towards the Union.

Since Switzerland rejected the EEA in 1992, referendums on EU membership have been initiated, the last time in 2001. These were rejected by clear majorities.

In mid-2005, representatives of the Faroe Islands have hinted at the possibility of their territory joining EFTA. However, the chances of the Faroes' bid for membership are uncertain because, according to the EFTA Convention, only states may become members of the Association.Fact|date=March 2008If the Faroe Islands gain independence there is a strong possibility that they may opt out of the EU altogether as Greenland has done.

United Kingdom

The United Kingdom benefited from the lack of common tariffs for EFTA members, by importing goods from the Commonwealth of Nations and selling them on to other EFTA members. Due to the advancement of the EEC and the decision to focus on Europe, rather than the United States and Commonwealth nations such as Australia, Canada and New Zealand, as trading partners, the United Kingdom chose to apply for EEC membership in 1961 (however, it did not become a member until 1973).

ee also

*Central European Free Trade Agreement (CEFTA)
*Enlargement of the European Union
*Euro-Mediterranean free trade area (EU-MEFTA)
*Free trade areas in Europe
*European Union Association Agreement, which covers many more countries
*Trade bloc
*Schengen Agreement


External links

* [ Official EFTA site]
* [ The history of EFTA in detail]
* [ Mission of Norway to the EU]
* [ The European Commission's Delegation to Norway and Iceland]
* [ European Free Trade Association] European Navigator

European Free Trade Association (EFTA)

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