EU signs internal-market association deal with Andorra and San Marino
The European Union signed an association agreement with Andorra and San Marino in Brussels. It sets a legal framework for the two states to participate extensively in the EU internal market under shared rules. Financial services face a separate, gradual process tied to supervision. European Parliament consent and further approval procedures remain necessary after the signature.
Geopolitics··Morning
Common rules govern internal-market participation
The European Union signed an association agreement with Andorra and San Marino in Brussels on 19 October. The two small European states are entering a common legal framework for extensive participation in the EU internal market. The framework covers the free movement of goods, people, services and capital, linking market participation to aligned rules and fair competition between businesses.[1], [2]
The agreement also creates a basis for dialogue and cooperation on research and innovation, education, social policy and the environment. Consumer protection, culture and regional cooperation are included. The European Commission, the EU’s executive institution, describes the framework as intended to provide greater legal certainty for citizens, businesses and public authorities while respecting the partners’ specific characteristics.[2]
Financial services face a separate assessment
Financial services will enter through a distinct, gradual process with specific conditions. Access depends on a positive assessment of the strength of the partners’ regulatory and supervisory arrangements. Cooperation with the relevant EU supervisory authorities is part of that process. The sector therefore has its own assessment requirements within the wider association framework agreed at the signing.[1], [2]
The EU also signed updated monetary agreements with both states, addressing overlaps with the new association arrangements. Andorra’s existing monetary agreement dates from 2011 and San Marino’s from 2012. Those agreements govern their use of the euro. Commissioners Maroš Šefčovič and Valdis Dombrovskis represented the European Commission at the signing ceremony.[1], [2]
Parliamentary consent and national procedures follow
Signature is followed by approval procedures. The Council must seek the European Parliament’s consent before concluding the agreement. Provisional application depends on the respective national procedures permitting it. Andorra will hold a binding referendum, with a date not yet decided. The association agreement provides a route into the internal market, rather than membership of the European Union.[1], [2]
The negotiating mandate was adopted in December 2014 and talks began in 2015. Monaco initially took part but suspended its negotiations in September 2023. Negotiations with Andorra and San Marino concluded in December 2023. The Commission presented its proposal in April 2024, and the Council authorised signature in July 2026, preceding the Brussels ceremony.[1]
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