• Back to 1992 (more or less)
  • Norway, Iceland and Liechtenstein status
  • Plus customs union
  • No customs duties
  • No declarations of origin or customs control
  • No/ very limited freedom to enter trade agreements
  • The UK largely a rule-taker of many trade rules
  • Free movement of goods
  • Free movement workers (plus other categories?)
  • Free movement of investment
  • Access to the single market in  services retained
  • EEA provides a template to a large extent
  • EU likely to accept EEA plus Customs Union
  • EFTA Court- indirectly binding

This outcome is no longer a significant possibility. The Conservative Party won the December 2019 UK General Election (80 seat majority 45% of Vote) on a policy of a more distant free trade agreement. The UK left the EU on 31st January 2020 on the EU UK negotiations are based on negotiating a free trade agreement without the UK being a member of  or having and equivalent close relationship with the EU customs union or single market.

EEA Plus

This is sometimes referred to as Common Market 2.0. or Norway plus. It is effectively the EFTA/ EEA  option together with a customs union. As members of the EEA, UK would retain full access to the single market including for the important financial services sector.

UK citizens and UK domiciled companies would be able to use the powerful treaty and EU legislative rights to exercise free movement of goods, services capital and persons within the EEA/EU.

The Common Market 2.0 is an attempt to recast the UK’s relationship with the EU to that which existed prior to the Maastricht Treaty in 1992. The UK would join EFTA and accede to the EEA agreement.

The UK would adopt the EU EEA measures and the single market including free movement of goods, services, capital and free movement of persons.

UK’s Status

The UK would no longer be subject to the Court of Justice of the EU but subject to the EFTA Court. However, the EFTA Court follows closely the case-law of the CJEU. It interprets the same laws with the difference is that its opinions are advisory.

The UK would be obliged, in practical terms to implement EU single market rules. It would be obliged to give effect to rulings of the EFTA Court. It could fail to do so in one sense, but there would then follow a process which may lead ultimately to the UK being excluded from the relevant EU area.

The Common Market 2.0 arrangement would replicate the free movement of persons. For this reason, it is unlikely to be viable given the perceived centrality of free movement of persons to the Brexit decision

Practical Difficulties

As the UK would largely be a rule-taker and have no freedom to enter trade agreements worldwide, it might seem that the position is inferior to EU membership, given the absence of input into laws.

The size of the UK relative to the other EFTA members may be problematical. It has different interests in some significant respects to those members.

Non-EU EEA countries must agree unanimously to adopt an EU law. Therefore if the UK did not do so, it would impede access for the other EFTA countries to the EEA market which is unlikely to be satisfactory for them.

Norway is very closely aligned with the EU and the issue of acceptance of EU laws is not highly politicised. It recognises its position as a relatively small member and is not in a confrontational relationship with the EU.

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