The relationship between Austria and the EU intensified slowly from 1960 until 1995 when Austria became a full member. In 1960, Austria and six other states founded the European Free Trade Association (EFTA) to provide a framework for the liberalization of trade in goods. After unsuccessful attempts to conclude an association agreement with the EU, the trade relationship between Austria and the EU was first governed by a general free trade agreement and other bilateral agreements. The conclusion of the European Economic Area Agreement between the EFTA members and the EU allowed Austria to participate in the EU internal market. In 1989, Austria submitted an application for full membership. Formal negotiations were conducted from 1993 until 1994. The Austrian people approved the accession to the EU in a referendum in June 1994.
I. General Membership Criteria
According to article 49 of the Treaty on European Union (TEU), “[a]ny European State which respects the values referred to in Article 2 and is committed to promoting them may apply to become a member of the Union.” Any country wishing to join has to fulfill key political and economic criteria for accession, as defined at the 1993 European Council in Copenhagen (“Copenhagen criteria”). The Copenhagen criteria overlap to some extent with the conditions spelled out in article 49 of the TEU. They must be taken into account when a membership application is considered.
The Copenhagen criteria state that a country must have stable institutions guaranteeing democracy, the rule of law, human rights, and respect for and protection of minorities; a functioning market economy and the capacity to cope with competition and market forces; and the administrative and institutional capacity to effectively implement the acquis communautaire (acquis) and the ability to take on the obligations of membership. In addition, the EU must have the capacity to integrate a new member. When the EU decides that a country is ready to fulfill these criteria, it becomes an official candidate for membership.
The application for membership is addressed to the Council of the European Union (EU Council), which is made up of one government representative from each EU Member State. The European Parliament and the national parliaments are notified of the application. Formal membership negotiations with a candidate country cannot start until all EU member governments agree on a framework or mandate for negotiations with the candidate country in an intergovernmental conference. The framework will address the conditions and timing of the applicant country’s adoption, implementation, and enforcement of the EU acquis. The acquis is divided into thirty-five different chapters (covering topics such as the four EU freedoms of the internal market, transport, energy, environment, financial arrangements, etc.), each of which is negotiated separately. For some chapters, rules will be phased in gradually. The process is monitored by the EU Commission, which regularly updates the EU Parliament and the EU Council on its progress. The duration of the negotiations varies depending on how prepared a country is to join.
At the end of the screening and monitoring process, the EU Commission delivers a final opinion to the EU Council on whether it recommends accepting the application. In addition, the EU Parliament must approve the application by a majority of its members. The requirement that the EU Parliament has to consent was added in 1986. The EU Parliament can therefore prevent the accession of new members.
The EU Council has the final say on whether the candidate country should be allowed to join. The Council’s decision must be unanimous. After the application is accepted, the political agreements are codified in a legal text (known as an accession treaty) which is then signed by the EU Member States and the candidate country. The accession treaty spells out the conditions for admission of the candidate country and the adjustments to EU treaties. Each EU Member State and the candidate country need to ratify the accession treaty in accordance with their respective constitutional requirements and deposit the instrument of ratification with the Italian government.
II. Austria’s EFTA Membership
Austria was one of the founding members of the European Free Trade Association (EFTA), an intergovernmental organization established by the Stockholm Convention on January 4, 1960. The other founding members were Denmark, Norway, Portugal, Sweden, Switzerland, and the United Kingdom. Finland became a full member in 1986. Iceland acceded to EFTA in 1970. The aim of EFTA is to provide a framework for the liberalization of trade in goods amongst its member states. At the time, it was also seen as a counterbalance to the emerging European Economic Community (EEC). EFTA is only a free trade agreement and not a customs union, so members retain responsibility to set their own tariffs with countries outside of EFTA and may conclude other free trade agreements with third countries.
On May 2, 1992, the European Economic Area Agreement (EEA Agreement) was signed by the EU Member States and the EFTA states. It entered into force on January 1, 1994. Liechtenstein joined on May 1, 1995. Switzerland rejected the EEA Agreement in a referendum held on December 6, 1992.
One of the aims of the EEA Agreement was “to contribute, on the basis of market economy, to worldwide trade liberalization and cooperation, in particular in accordance with the provisions of the General Agreement on Tariffs and Trade.” It obligated the EFTA countries to implement EU legislation covering the free movement of goods, services, persons, and capital in order to participate in the internal market, but left them without the possibility of taking part in the decision making. The EEA members therefore already fulfilled approximately half of the conditions of accession to the EU. The EEA Agreement did not cover the Customs Union, the Common Trade Policy, the Common Foreign and Security Policy, Justice and Home Affairs, the Economic and Monetary Union, or the Common Agriculture and Fisheries Policies (although it did contain provisions on various aspects of trade in agricultural and fish products).
For most countries, membership in EFTA was only the first step to joining the European Economic Area (EEA) and/or subsequently becoming a member of the EU. Membership in EFTA was the first step for Austria towards European integration.
III. Application for Association
In 1961, Austria applied for the first time for association with the European Community along with the other neutral EFTA members Sweden and Switzerland on the basis of former article 238 of the Treaty Establishing the European Economic Community (EEC Treaty). Article 238 of the EEC Treaty allowed the EEC to conclude agreements “establishing an association involving reciprocal rights and obligations, common action and special procedure” with one or more third countries or international organizations. The negotiations failed mainly as a result of the neutrality issue. Austrian and Finnish neutrality in the post-World War II period resulted from their situation as smaller and weaker states located between powerful countries in the East and West. For them it was more opportune to act as a buffer between the powerful military alliances. Austria’s neutrality is laid down in the Federal Constitutional Law on the Neutrality of Austria.
In 1963, Austria submitted another application for association based on article 238 of the EEC Treaty. Negotiations were conducted from 1965 to 1967, but failed because of various political problems, among them the hostility of the Soviet Union towards a closer relationship between the EEC and Austria and the question of autonomy of South Tyrol between Italy and Austria.
IV. Free Trade and Bilateral Agreements between Austria and the EEC
Due to the failure of the conclusion of a far-reaching association agreement, Austria and the EEC instead entered into negotiations to abolish tariffs for goods. In 1972, on the basis of former article 113 of the EEC Treaty, Austria and the EEC concluded an interim free trade agreement which entered into force on October 1, 1972. It was replaced by a general free trade agreement (FTA) shortly thereafter, which entered into force on January 1, 1973. It was negotiated by the EEC in parallel with FTAs with other EFTA members. During a brief period of fifteen months, Austria alone qualified for a greater initial tariff reduction than the other EFTA countries because of the interim agreement, which came into force three months before the general free trade agreement. It received an initial tariff reduction of 30% instead of the 20% agreed upon in the general FTAs with the other EFTA countries.
In addition to the general FTA with the EEC, another agreement was concluded with the European Coal and Steel Community (ECSC), another one of the three pillars of the European Communities.
FTAs are compatible with World Trade Organization (WTO) rules as long as certain conditions are observed to ensure the complementarity of the FTA with the WTO system. This includes, among others, the conditions specified in article XXIV of the GATT (trade in goods) and in article V of the GATS (trade in services). The general FTA with Austria envisaged the progressive implementation of a free trade area for industrial goods and certain processed agricultural products, but did not set up a customs union, which would involve a joint external tariff.
Other bilateral agreements were concluded between Austria and the EEC in the area of transit of goods. Because of Austria’s geographical location, a high volume of EEC goods were transported through Austria. In addition, Austria wanted to take precautions to avoid environmental threats to the Alpine passes caused by heavy goods vehicles. In 1972, a first EEC-Austria transit agreement was concluded. The aim of the agreement was to simplify customs procedures affecting the transit of EU goods. Another transit agreement was concluded in 1975. It dealt with the conditions of passage through and warehousing in Austria of goods traded between the EEC and Greece and Turkey. Its goal was to simplify customs formalities and facilitate trade between the northern EEC Member States and southern states with which the EEC had association agreements. In 1992, parallel to the EEA negotiations, another transit agreement was concluded which created an “eco points system” of transit licenses to reduce the emissions and noise generated by heavy goods vehicles transiting Austrian territory.
V. Accession of Austria to the EEC
A. Reasons for Membership
In the mid-1980s, Austria’s industry struggled and economic growth stagnated. The EEC was working on completing the internal market and Austria feared it would lose market share. The EEC market was important for Austria, because it traded most of its goods with EU Member States and had the highest percentage of EFTA exports to the EU. In the late 1980s, more than 60% of Austria’s exports went to EU countries. Austria approached the EEC with a proposal to participate in the internal market and the decision-making process without becoming a full member, but this idea was rejected by the EU. Austria’s business associations and the Federal Chamber of Commerce pushed for full membership. In 1988, the Austrian Trade Union Confederation also showed support because of predicted improved economic development and the reduction of prices and increase in employment. On July 17, 1989, the Austrian government therefore sent a letter to the EU Council asking to join the EEC. The Austrian government identified a commitment to neutrality, keeping social welfare standards, and upholding strict environmental protection laws as conditions for membership. The letter to the EU Council therefore included a neutrality clause.
The EU Commission presented its preliminary opinion on Austria’s accession on August 1, 1991. The Commission decided that no formal accession negotiations should be started before the EU internal market was completed and the discussions to establish an economic and monetary union and a political union were finished.
Formal negotiations were opened on February 1, 1993. Negotiations took place over the course of nine separate meeting at the ministerial level, 130 meetings to decide how to implement the EU acquis, and 72 meetings of departments in specific fields. Negotiations on an important number of chapters of the acquis were facilitated by the existence of the FTA between the EU and Austria and the EEA Agreement between the EFTA countries and the EU, whereby Austria was already committed to take over in its national legislation most of the EU acquis. The negotiations were concluded on April 12, 1994.
With regard to neutrality, Austria and the other countries applying for membership confirmed in a joint declaration, which was added to the accession treaty, that they would accept the EU acquis, that they would be ready and able to fully participate in the Common Foreign and Defense Policy, and that they would amend their legal rules on neutrality to make them compatible with the EU acquis.
Austria was allowed to maintain its stricter environmental rules for a transitional period of four years. The EU agreed to review the relevant directives on the environment during that time and eventually adjust them. Furthermore, the EU promised to conclude free trade agreements with the Baltic states so that the Nordic countries that applied at the same time as Austria could maintain free trade with them.
At the ministerial meeting that took place from February 26 to March 1, 1994, the remaining topics, in particular agriculture, were discussed. Austria preferred longer transitional periods, whereas the EU insisted on an immediate acceptance of the rules of the Common Agricultural Policy. As a compromise, Austria and the other new members would be allowed to grant transitional and degressive national aid to producers of basic agricultural products over the course of the next five years.
Transit of heavy goods by road through Austria was another important topic for Austria during the negotiations. The final agreement built on the 1992 bilateral agreement between the EEC and Austria. The parties agreed that the eco points system would be used for another nine years and that pollution from heavy goods vehicles would be reduced by 60%. Austria’s bargaining position to limit the normally unrestricted right of passage through member states was strengthened by the fact that Switzerland had voted in a referendum in 1994 to adopt legislation to prohibit any transit of heavy goods vehicles by road within the next ten years.
C. Approval of the Application and Accession Treaty
On April 19, 1994, the EU Commission delivered a favorable opinion on the question of Austria’s accession to the EEC. The EU Parliament consented to the accession request on May 4, 1994. The EU Council decided on May 16, 1994 to accept the application.
Subsequently, the Austrian parliament, which consists of the National Council (Nationalrat) and the Federal Council (Bundesrat), approved the Austrian Federal Constitutional Act on the Accession of Austria to the European Union. The Act authorized the government to sign the accession treaty. On June 12, 1994, the Austrian people approved the accession to the EEC in a referendum with 66.6% voting in favor. The accession treaty between the EU Member States and Austria was signed on June 24, 1994. The Austrian parliament ratified the accession treaty in November 1994. It entered into force on January 1, 1995 after ratification by all EU Member States as provided in article 2, paragraph 2 of the treaty.
Prepared by Jenny Gesley
Foreign Law Specialist
 The values referred to are human dignity, freedom, democracy, equality, the rule of law, and respect for human rights, including the rights of persons belonging to minorities.
 Treaty on European Union (TEU) art. 49, 2012 O.J. (C 326) 13, http://eur-lex.europa.eu/resource.html?uri=cellar: 2bf140bf-a3f8-4ab2-b506-fd71826e6da6.0023.02/DOC_1&format=PDF, archived at http://perma.cc/D6TR-LVCF.
 Presidency Conclusions, Copenhagen European Council (June 21–22, 1993), http://www.europarl.europa.eu/ summits/copenhagen/co_en.pdf, archived at http://perma.cc/AN3K-ZKVC.
 TEU art. 49, para. 1, sentence 4.
 The acquis is a constantly evolving body of EU primary and secondary law and obligations that are binding on all EU member states.
 Presidency Conclusions, supra note 3.
 TEU art. 16, para. 2.
 Chapters of the Acquis, European Commission, https://ec.europa.eu/neighbourhood-enlargement/policy/ conditions-membership/chapters-of-the-acquis_en (last updated Dec. 6, 2016), archived at http://perma.cc/5CM2-4VTY.
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 TEU art. 49, para. 1
 TEU art. 49, para. 2, sentence 1.
 TEU art. 40, para. 2, sentence 2. As the original EEC Treaty was signed in Rome, the Italian government is the depository for EU treaties and any amending treaties and acts.
 Übereinkommen zur Einrichtung der Europäischen Freihandelsassoziation [Convention Establishing the European Free Trade Association], Jan. 4, 1960, Bundesgesetzblatt [BGBl.] [Federal Law Gazette] No. 100/1960, https://www.ris.bka.gv.at/Dokumente/BgblPdf/1960_100_0/1960_100_0.pdf, archived at http://perma.cc/V3P2-8T66.
 The EEC was later renamed the European Community (EC) and would eventually become the EU.
 Agreement on the European Economic Area (EEA Agreement), 1994 O.J. (L 1) 3, http://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:31994D0001&from=EN, archived at http://perma.cc/9FEX-D4ZJ.
 Bundesratsbeschluss über das Ergebnis der Volksabstimmung vom 6. Dezember 1992 (Europäischer Wirtschaftsraum [EWR]) [Decision of the Federal Council on the Result of the Referendum of Dec. 6, 1992 (European Economic Area [EEC]), 1993 Bundesblatt [BBl.] [Federal Gazette] I at 167, https://www. amtsdruckschriften.bar.admin.ch/viewOrigDoc.do?id=10052502, archived at http://perma.cc/AP4Z-P4NM.
 EEA Agreement pmbl.
 EEA Agreement art. 1.
 EEC Treaty art. 238 (as in effect 1961) (now Consolidated Version of the Treaty on the Functioning of the European Union (TFEU) art. 217, 2012 O.J. (L 326) 47, http://eur-lex.europa.eu/legal-content/EN/TXT/ PDF/?uri=CELEX:12012E/TXT&from=en, archived at http://perma.cc/6ZXF-JAHS).
 European Parliament, Directorate-General for Internal Policies of the Union, The Accession Negotiations with Austria, Sweden, Finland, and Norway at 6 (June 1994), http://bookshop.europa.eu/en/the-accession-negotiations-with-austria-sweden-finland-and-norway-pbQAPOLIE02/downloads/QA-PO-LI-E02-EN-N/QAPOLIE02ENN _002.pdf;pgid=GSPefJMEtXBSR0dT6jbGakZD00009LKmv2EI;sid=xhB2Wflml3R2WaGQyXXo_ptDwcNwilulukA=?FileName=QAPOLIE02ENN
_002.pdf&SKU=QAPOLIE02ENN_PDF&CatalogueNumber=QA-PO-LI-E02-EN-N, archived at http://perma.cc/A4KP-6FYX.
 Id. at 29.
 Bundesverfassungsgesetz vom 26. Oktober 1955 über die Neutralität Österreichs [Federal Constitutional Law of October 26, 1955 on the Neutrality of Austria], Oct. 26, 1955, BGBl. No. 211/1955, https://www.ris.bka.gv.at/ GeltendeFassung/Bundesnormen/10000267/Neutralitätsgesetz, Fassung vom 24.04.2017.pdf, archived at http://perma.cc/22S9-REPL, English translation available at https://www.ris.bka.gv.at/Dokumente/Erv/ERV_1955_ 211/ERV_1955_211.pdf, archived at http://perma.cc/MKS6-MQK4.
 European Parliament, supra note 22, at 6.
 EEC Treaty art. 113 (as in effect 1961) (now TFEU art. 207). It allowed the conclusion of trade agreements with third countries or international organizations in the area of the common commercial policy.
 Interimsabkommen zwischen der Europäischen Wirtschaftsgemeinschaft und der Republik Österreich [Interim Agreement between the European Economic Community and the Republic of Austria], 1972 O.J. (L 223) 3, http://eur-lex.europa.eu/legal-content/DE/TXT/PDF/?uri=CELEX:21972A0929(01)&from=DE, archived at http://perma.cc/FVW5-LLQZ.
 Mitteilung bezüglich des Zeitpunkts, zu dem das Interimsabkommen zwischen der Europäischen Wirtschaftsgemeinschaft und der Republik Österreich in Kraft tritt [Notification Concerning the Entry Into Force of the Interim Agreement between the European Economic Community and the Republic of Austria], 1972 O.J. (L 223) 84, http://eur-lex.europa.eu/legal-content/DE/TXT/PDF/?uri=OJ:JOL_1972_223_R_0084_01&from=DE, archived at http://perma.cc/SLQ9-VAPJ.
 Abkommen zwischen der Republik Österreich und der Europäischen Wirtschaftsgemeinschaft samt Anhang und Protokolle Nr. 1 bis 5 samt Anhängen sowie Erklärung und Notenwechsel samt Anhang [Free Trade Agreement between the Republic of Austria and the European Economic Community including Annex and Protocols No. 1 to 5 including Annexes as well as a Declaration and Exchange of Notes including Annex] (General FTA Austria–EEC), BGBl. No. 466/1972, https://www.ris.bka.gv.at/Dokumente/BgblPdf/1972_466_0/1972_466_0.pdf, archived at http://perma.cc/JF2N-K647.
 Interim Agreement between the European Economic Community and the Republic of Austria art. 2; General FTA Austria–EEC art. 2, para. 2.
 Abkommen zwischen der Republik Österreich einerseits und den Mitgliedstaaten der Europäischen Gemeinschaft für Kohle und Stahl und der Europäischen Gemeinschaft für Kohle und Stahl andererseits samt Anhang und Protokollen Nr. 1 und 2 sowie Erklärung [Agreement between the Republic of Austria on the one hand and the Member States of the European Coal and Steel Community and the European Coal and Steel Community on the other hand including the Annex and Protocols No. 1 and 2 as well as a Declaration] BGBl. No. 467/1972, https:// www.ris.bka.gv.at/Dokumente/BgblPdf/1972_467_0/1972_467_0.pdf, archived at http://perma.cc/7WK7-3RW9.
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 General FTA Austria–EEC, supra note 29, art. 3.
 Abkommen zwischen der Europäischen Wirtschaftsgemeinschaft und der Republik Österreich zur Anwendung der Bestimmungen über das Gemeinschaftliche Versandverfahren [Agreement between the European Economic Community and the Republic of Austria on the Application of the Community Customs Transit Rules], 1972 O.J. (L 294) 87, http://eur-lex.europa.eu/legal-content/DE/TXT/PDF/?uri=CELEX:21972A1130(01)&from=DE, archived at http://perma.cc/GX5G-4QE8.
 Id. art. 1.
 Agreement between the European Economic Community and the Republic of Austria on the simplification of formalities in respect of goods traded between the European Economic Community on the one hand and Greece and Turkey on the other hand when the said goods are forwarded from Austria, 1975 O.J. (L 188) 2, http://eur-lex. europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:21975A0611(01)&from=EN, archived at http://perma.cc/ 8N87-JWS2.
 Id. pmbl.
 Agreement between the European Economic Community and the Republic of Austria on the Transit of Goods by Road and Rail art. 15, 1992 O.J. (L 373) 6, http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX: 21992A1221(01)&from=EN, archived at http://perma.cc/KL7M-PDK2.
 Paul Luif, On the road to Brussels: the Political Dimension of Austria’s, Finland’s, and Sweden’s Accession to the European Union 189 (1995).
 Id. at 182.
 Id. at 191.
 Id. at 191, 192.
 Id. at 193, 194.
 Brief nach Brüssel [Letter to Brussels], from Alois Mock, Austrian Foreign Minister, to Roland Dumas, President of the EC Council of Ministers (July 17, 1989), https://www.parlament.gv.at/ZUSD/PDF/Brief_Bruessel.pdf, archived at http://perma.cc/9R8Z-8LY8.
 Luif, supra note 40, at 196.
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 Treaty between the Kingdom of Belgium, the Kingdom of Denmark, the Federal Republic of Germany, the Hellenic Republic, the Kingdom of Spain, the French Republic, Ireland, the Italian Republic, the Grand Duchy of Luxembourg, the Kingdom of the Netherlands, the Portuguese Republic, the United Kingdom of Great Britain and Northern Ireland (Member States of the European Union) and the Kingdom of Norway, the Republic of Austria, the Republic of Finland, the Kingdom of Sweden, concerning the accession of the Kingdom of Norway, the Republic of Austria, the Republic of Finland and the Kingdom of Sweden to the European Union (Accession Treaty), 1994 O.J. (C 241) 9, 381, Joint Declaration on Common Foreign and Security Policy, http://eur-lex.europa.eu/resource.html ?uri=cellar:6a09c1b5-b835-42e7-9901-0c33354bf77b.0008.03/DOC_1&format=PDF, archived at http://perma.cc/ EM5D-GTNN.
 Luif, supra note 40, at 311.
 Accession Treaty, supra note 50, art. 138.
 See supra note 39. The 1992 agreement covered the eco points system of transit licenses.
 Accession Treaty, supra note 50, art. 11.
 Luif, supra note 40, at 313; Bundesratsbeschluss über das Ergebnis der Volksabstimmung vom 20. Februar 1994 [Federal Council Decision on the Result of the Referendum of Feb. 20, 1994], 1994 BBl. II at 696, https://www. amtsdruckschriften.bar.admin.ch/viewOrigDoc.do?id=10053008, archived athttp://perma.cc/74U4-F54S; Schweizerische Bundeskanzlei [Swiss Federal Chancellery], Eidgenössische Volksinitiative 'zum Schutze des Alpengebietes vor dem Transitverkehr [Referendum to Protect the Alpine Passes from Transit Transport], https:// www.admin.ch/ch/d/pore/vi/vis204t.html, archived athttp://perma.cc/ZJF6-2N89.
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 Accession Treaty, supra note 50.
Last Updated: 05/16/2017