European common market

The European Common Market also known as the internal market of the European Union or European single market is one of the instruments of economic integration that the European Union uses, which consists of the establishment of a common market between the twenty seven states who are members of it. The aim of having a single market for goods, services, capital and people to circulate freely, where in turn, citizens of the union can live, study, work or do business freely.

The Maastricht Treaty, officially called the Treaty on the European Union (Maastricht, 1992), is together with the Treaty on the Functioning of the European Union (Rome, 1957), one of the founding treaties of the European Union. The internal market is mentioned in Article 3(3) of the Treaty on European Union (TEU) as one of the objectives to be achieved by the Union. Furthermore, the Treaty on the Functioning of the European Union (TFEU), in its article 26(1) states that the European Union shall adopt measures to establish or ensure the functioning of the internal market .

In 1957 the Treaty of Rome was signed, which meant the creation of the European Economic Community (ECC), which a few years later, was renamed the European Community (EU). The main goal of the Community was to achieve economic integration, including a common market and customs union, among its six founding members. As Cuyvers explains in his book “it was thought that by integrating markets and economies, peace and stability would follow. Not only would Member States [...] economic integration would also lead to a de facto solidarity and would make waging war economically impossible" (Cuyvers, A., 2017, p. 293) .

The Free Movement of Goods

The free movement of goods or products is described as “one of the successes of the European project” by the European Commission. This free movement implies the establishment of a customs union covering all trade in goods and involving the prohibition, between Member States, of customs duties on imports and exports. It also provides for the adoption of a common customs tariff in its relations with third countries. But for this to happen, three conditions must be met  :

• The first one is that for a product to be considered a good, that product must be capable of being valued economically and subject of commercial transaction.
• The second condition is that the goods must be used in cross-border trade between the European Union.
• And finally, the person to whom the provision applies must be an addressee of the Treaties.

The Free Movement of Services

The freedom to provide services is set out in the TFEU, in particular in Articles 56 and 57, but these articles only provide a general outline. Therefore, the CJEU has developed a number of questions, such as what is the concept of service, the delimitation between services and establishment and the question of who can rely on the freedom to provide services . This free movement is achieved by the exclusion of restrictions on the freedom to provide services within the Union for nationals of Member States established in a Member State other than that of the recipient of the service. Thus, the freedom movement of services includes two essential assumptions. The first concerns the provision of a service in the country of establishment of the provider, the recipient of which is not a national of the country but of another Member State. The second one concerns the provision of a service in a country other than that in which the provider is established.

The Free Movement of Capital

Another fundamental free movement, which has been established by economic and monetary union, is the freedom of capital in the EU. The free movement of capital is defined by the TFEU, where Article 63 as a general rule prohibits any restriction on the movement of payments and capital, both between Member States and between non-EU countries and Member States. Therefore, taking into account this freedom, “the Member States have the obligation to reduce and abolish any hindrances that appear in the transnational capital movement and money transfers for an effective functioning in the internal market” (Roggenthien, S., 2014, p. 6) .

The Free Movement of People

Labour is one of the factors of production that must move freely for the internal market to function properly. So, the free movement of labour therefore implies the free movement of persons. The free movement of people is laid down in the Article 45(1) of the TFEU. Discrimination on grounds of nationality with regard to employment, pay and other working conditions is prohibited. With this in mind, it expressly establishes the right of posting, residence and stay of Community workers. Therefore, all nationals of a Member State are automatically EU citizens, and it is this citizenship that underpins the right to move and reside freely within the territory of the Member States .

References

• European Commission, Directorate-General for Enterprise and Industry. (2010). Free movement of goods : guide to the application of Treaty provisions governing the free movement of goods. Publications Office.
• Pomfret, R. (2021). The Economic Integration of Europe. Harvard University Press.
• Roggenthien, S. (2014). The Four Freedoms of the European Union. Grin.
• Ugirashebuja, E., Ruhangisa, J. E., Ottervanger, T., & Cuyvers, A. (2017). East African Community Law: Institutional, Substantive and Comparative EU Aspects. Brill.

Author: Idoia Arregi