EUROPEAN COMMUNITY

(EC) formerly (until Nov. 1, 1993) European Economic Community (EEC), byname Common Market economic association of European countries that was established to promote European economic unity. The EEC was established in the wake of World War II to promote the lasting reconciliation of France and Germany, to develop the economies of the member states into one large common market, and to try to develop a political union of the states of western Europe capable of alleviating their fears of war with each other. The liberalized trade policies sponsored by the EC from the 1950s were highly successful in increasing trade and economic prosperity in western Europe. The EC is now the principal organization within the European Union (q.v.). The European Economic Community was formally established by one of the Treaties of Rome in 1957 to facilitate (1) the removal of barriers to trade among the member nations, (2) the establishment of a single commercial policy toward nonmember countries, (3) the eventual coordination of members' transportation systems, agricultural policies, and general economic policies, (4) the removal of private and public measures restricting free competition, and (5) the assurance of the mobility of labour, capital, and entrepreneurship among the members. The original members were France, Belgium, Luxembourg, The Netherlands, Italy, and West Germany. The United Kingdom, Denmark, and Ireland joined in 1973, Greece in 1981, and Portugal and Spain in 1986. The former East Germany was admitted as part of reunified Germany in 1990. Austria, Finland, and Sweden joined the European Union, and hence the EC, in 1995. Plans for a common market in western Europe had been discussed in 1955 at a meeting in Messina, Sicily; the treaty was finally signed in March 1957, and the EEC came into operation on Jan. 1, 1958. The four primary structural organs of the EEC were the Commission, the Council of Ministers, the Court of Justice, and the European Parliament; the last two were also to serve the other two branches of the European Communitiesthe European Coal and Steel Community (ECSC) and the European Atomic Energy Community (Euratom). From the beginning one of the EEC's main goals was to eliminate the tariffs, customs duties, and quotas that its members imposed on each other's exports. Accordingly, the first reduction in EEC internal tariffs was implemented in January 1959, and this proved so successful in stimulating trade between member states that by July 1968 all internal tariffs had been removed. Trade among the member nations of the EEC quadrupled in value in the period from 1958 to 1968. Meanwhile, the EEC had adopted a common external tariff so that all of its member states imposed uniform duties on goods imported from nonmember nations. A common agricultural policy was established in 1962 and consisted of a system of common guaranteed prices (expressed in dollar terms for convenience) that would offer protection against agricultural imports from lower-cost markets outside the EEC. Because of the high cost of price supports and the resentment of the manufacturing countries, which felt that they were being forced to subsidize inefficient agriculture, the community in 1979 agreed to gradually eliminate the subsidies, replacing them with an intervention price designed to prevent agricultural prices from falling below fixed levels. The European Communities came into existence on July 1, 1967, in the merger of the EEC, the ECSC, and Euratom. Previously each of these three separate organizations had its own commission (called the High Authority in the case of the ECSC) and its own council. The merger created a single Commission of the European Communities and a single Council of Ministers of the European Communities. Other executive, legislative, and judicial bodies were also collected under the umbrella of the EC. The plural was dropped from the EC's name in the 1980s as the economic integration of the nations of western Europe progressed, and the organization became known as the European Community. In 1993 the European Community became the basis for the European Union. At the same time, the European Economic Community was renamed the European Community. The economic history of the EEC (and of the EC) since the 1970s is subsumed in that of the European Union.