Citizens of EFTA Member States enjoy freedom of movement in the territories of the other country, in accordance with the EFTA Convention.  EFTA citizens also enjoy free movement in the European Union (EU). Not only are EFTA citizens and EU citizens visa-free, but they also have the right to enter and stay in other countries. The Citizens` Rights Directive (also known as the “Free Movement of Persons Directive”) defines the right of citizens of the European Economic Area (EEA), which includes the three EFTA members, Iceland, Norway and Liechtenstein, as well as EU member states. Switzerland, which is a member of EFTA but not of the EEA, is not bound by the directive, but has a separate bilateral agreement on free movement with the EU. EFTA strives to become a world open to trade, but is committed to recognizing all dimensions of sustainable development in its free trade agreements, such as environmental, labour and human rights protection. The Fues have already concluded a comprehensive bilateral free trade agreement with Iceland, known as the Hoyvek Agreement. EFTA free trade agreements are notified to the World Trade Organization (WTO). They build on WTO rules and obligations to improve the cross-border economic trade framework and add value to reduce barriers to trade and legal security. EFTA states see free trade agreements as a complement and not as a substitute for the multilateral trading system.
In 1992, EFTA and the EU signed the European Economic Area Agreement in Porto, Portugal. However, the proposal for Switzerland to ratify its participation was rejected in a referendum. (Nevertheless, Switzerland has several bilateral agreements with the EU that allow it to participate in the European single market, Schengen agreements and other programmes).) Thus, with the exception of Switzerland, EFTA members are also members of the European Economic Area (EEA). The EEA comprises three member states of the European Free Trade Association (EFTA) and 28 Member States of the European Union (EU), including Croatia, which applies the agreement provisionally until it is ratified by all EEA countries.   It was created on 1 January 1994 as a result of an agreement with the European Community (which had complied with the EU two months earlier).  It allows EFTA-EEA states to participate in the EU internal market without being eu membership. They transpose almost all EU internal market legislation, with the exception of agriculture and fisheries legislation. However, they also contribute to the implementation of new EEA policies and legislation at an early stage as part of a formal decision-making process. One EFTA member, Switzerland, has not joined the EEA, but has a number of bilateral agreements, including a free trade agreement, with the EU. The Council examines substantive issues, including the development of EFTA relations with third countries and the management of free trade agreements, and examines the relationship with the policy and administration of EU third countries in general. It has a broad mandate to examine possible policies to promote the Association`s overall objectives and to facilitate the development of links with other states, state organizations or international organizations. The Council also manages relations between EFTA states under the EFTA Convention.