Institutional Challenges for External Differentiated Integration : The Case of the EEA

This working paper analyses the institutional challenges related to external differentiated integration in the European Economic Area (EEA). It focuses mainly on the formulation of EEA-relevant EU legislation and its incorporation into the EEA Agreement. The paper shows that over the past 25 years various institutional arrangements have been added to the initial institutional framework of the EEA in order to increase and maintain substantive integration. However, the European Union (EU) has been consistent in protecting the autonomy of its decision making which is why the EEA EFTA States have far-reaching access to EU policy making but never the right to vote. The EEA EFTA States therefore insist on separate EEA decision making whenever possible. This has given them a surprisingly large amount of room for manoeuvre for instance, by deliberately delaying the incorporation of politically sensitive acts, and by making EEA-specific adaptations to EU acts. On the other hand, they were also forced to introduce simplified procedures for EEA decision making in order to cope better with the high legislative dynamics of the EU. These procedures give priority to the efficacy of the EEA over the decision-making autonomy of the EEA EFTA States by establishing a more or less automatic rule transfer from the EU to the EEA. Thanks to its far-reaching functional and institutional integration the EEA provides a good example for the analysis of the legal and political feasibility of external differentiated integration. Above all, the results of the empirical analysis demonstrate how difficult it is to reconcile the integration reservations of non-Member States with the principles of the EU in an institutional framework designed to ensure the long-term good functioning of their relations