Report on the EU relations with Andorra, Monaco and San Marino. Options for their participation in the internal market

On 20 November 2012, the Commission adopted a Communication on enhancing the EU’s relations with the Principality of Andorra, the Principality of Monaco and the Republic of San Marino, and its accompanying Commission Staff Working Paper on obstacles to these countries’ access to the EU’s internal market and cooperation in other areas. The Communication described the current close relations between the EU and these small-sized European countries. Its assessment was that there was significant potential to develop relations further for mutual benefit.

In particular, in the context of the current economic and financial crisis, it highlighted the contribution that closer economic ties could make to achieving sustained economic recovery in Europe and the EU’s 2020 Strategy, including greater employment, trade and investment activity in EU regions neighbouring these countries. Importantly, it concluded by setting out five options for the small-sized countries’ participation in the internal market.

In its conclusions of 20 December 2012, the Council welcomed the Communication and selected two of the options as most viable:
i) participation of these small-sized countries in the European Economic Area (EEA); and
ii) the negotiation of one or more Framework Association Agreement(s) with them, ‘with a view to giving them access to the EU’s internal market, its flanking measures and horizontal policies, and including institutional mechanisms following the model of the Agreement on the European Economic Area’.

The Council invited the Commission and the High Representative (as appropriate) to continue their analysis of these two options and in particular:
– ‘to hold consultations with the Governments of Andorra, Monaco and San Marino and other relevant parties, starting in the first semester 2013, with a view to identifying the feasibility of and the degree of support for these two options, taking into account, in particular, the institutional conditions referred to in the Communication’; and
– ‘to submit to the Council, before the end of 2013, a report, including an analysis of the impact and of the main institutional, political and economic implications of these options, as well as recommendations regarding further steps’.

This report responds to the Council’s invitation. It has been prepared on the basis of consultations with the small-sized countries and the EEA-EFTA states. It incorporates information gathered during visits by the European External Action Service (EEAS) and Commission services to Andorra, Monaco and San Marino in March 2013, complemented by the countries’ responses to a detailed questionnaire on their legislation and administrative capacity.

EUR-Lex: COM(2013)793: Follow the progress of this report through the decision-making procedure http://eur-lex.europa.eu/legal-content/EN/HIS/?uri=COM:2013:793:FIN

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