Definition
The European Economic Community (EEC), initially known as the Common Market, was a regional organization created in 1957 by the Treaty of Rome. Its aim was to integrate the economies of six founding member states—Belgium, France, Germany, Italy, Luxembourg, and the Netherlands—by establishing a common market and a customs union. Over time, the EEC became one of the foundational pillars of the European Union, which absorbed it in 1993 through the Maastricht Treaty.
Key Features
- Common Market: The EEC facilitated free movement of goods, services, labor, and capital among member states.
- Customs Union: It eliminated internal tariffs and established a common external tariff on imports from non-member countries.
- Common Policies: Common policies on agriculture, transportation, and competition were developed to ensure uniform regulations across the member states.
- Economic Integration: Aimed at reducing disparities in wealth and development between member states.
- Expansion: Over time, the EEC expanded its membership to include other European countries.
Examples
- Common Agricultural Policy (CAP): A system of agricultural subsidies and programs shared among EEC member countries to stabilize markets and guarantee food supplies.
- European Single Market: As an evolution of the common market, this initiative allowed for the free movement of goods, services, people, and capital.
Frequently Asked Questions
What was the main objective of the EEC?
The main objective of the EEC was to foster economic cooperation and integrate the economies of Europe, particularly through creating a common market and customs union.
How did the EEC evolve into the European Union?
The EEC evolved into the European Union with the signing of the Maastricht Treaty in 1991, which came into force in 1993. This treaty expanded the EEC’s scope from purely economic cooperation to include political integration.
Which countries founded the EEC?
The EEC was founded by Belgium, France, Germany, Italy, Luxembourg, and the Netherlands.
What is the significance of the Treaty of Rome?
The Treaty of Rome, signed in 1957, established the EEC and laid the foundation for the creation of a common market and customs union among its member states.
How did the EEC benefit its member states?
The EEC facilitated increased trade, economic prosperity, and political stability among its member states through cooperation, unified policies, and reduced trade barriers.
Related Terms
European Union (EU)
An economic and political union of 27 European countries, the EU was established by the Maastricht Treaty in 1993, absorbing the EEC and expanding its role beyond economic matters to include political, social, and security policies.
Customs Union
A trade agreement by which a group of countries charge a common set of tariffs to the rest of the world while allowing free trade among themselves.
Single Market
A type of trade bloc in which most trade barriers have been removed for goods and services, and common policies on product regulation, and freedom of movement of the factors of production (capital and labor) are in place.
Online References
- European Commission - The History of the European Union
- Europa - The Founding of the Community
- OECD - The European Economic Community
Suggested Books for Further Studies
- “The European Union: A Very Short Introduction” by John Pinder and Simon Usherwood
- “The Economy of the European Union” by Neil Nugent
- “Building the European Union” by John Pinder
- “The European Union Explained: Institutions, Actors, Global Impact” by Andreas Staab
Fundamentals of the European Economic Community: Business Law Basics Quiz
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