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Microstates and the European Union

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The five European microstates
 Andorra
 Liechtenstein
 Monaco
 San Marino
 Vatican City
bordered by the European Union (blue)

There are a number of microstates in Europe; due to their size, they are often closely linked with another larger state. Currently, the European microstates have special relations with the European Union.

They remain outside the Union, some due to the cost of membership, the EU not being designed with microstates in mind. Two other smaller countries in Europe, Luxembourg and Malta, are full members of the Union. Iceland is considered a microstate by some due to its small population;[1] it is a member of the European Economic Area, and has applied for membership in the EU (See: Accession of Iceland to the European Union).

Andorra

Andorra has had a customs union with the Union since 1991 though is not in the EU's customs territory for agricultural produce. Andorra also maintains its border controls by staying outside of Schengen, though citizens holding a Schengen visa can usually enter.

Andorra is the only microstate to use the euro without an official agreement, having not had its own currency before the euro, when it used both the French franc and Spanish peseta. Though Andorra is in talks with the Union over an agreement that would allow it to mint its own coins, these have been stalled recently due to problems over banking rules that Andorra must adopt.

The government has said that "for the time being" there is no need to join the EU;[2] however, the governing Social Democratic Party is in favour.[citation needed]

Liechtenstein

Liechtenstein is the only microstate (not counting Iceland by population or EU members) that is a part of the European Economic Area (since 1 May 1995) after becoming a full member of the EFTA on 1 January 1995, thereby being opened to the Union's single market with partial application of European law. It also became a signatory of the Schengen Agreement on 28 February 2008, but is not currently a part of Schengen Area. There are, however, plans to implement the agreement fully at a later date. Switzerland shares an open border with Liechtenstein and is a full Schengen Area member. This open border is not considered a threat to European security because it would be highly difficult or impossible to enter Liechtenstein without first landing in or entering a Schengen state. There is currently no timeline for Liechtenstein's implementation of the agreement and the process has been delayed or postponed several times. The border with Austria is not open, and it is treated as an external border post by Austria and Liechtenstein, making it necessary to pass through customs and passport control before crossing.

Liechtenstein uses the Swiss franc rather than the euro. If Switzerland were to join the EU, Liechtenstein would need to submit a separate application as there is no provision for joint EU membership applications.

Monaco

Monaco currently applies certain policies of the European Union through its special relationship with France, a member state.[3] Monaco is a full part of the EU's customs territory and VAT area, applying most EU measures relating to VAT and Excise duties. Monaco is a de facto member of the Schengen area (its borders and customs territory are treated as part of France) and the euro currency zone (minting its own coins, having previously had its currency tied 1:1 with the French franc). It has implemented the EU Directive on the taxation of savings interest.[4]

San Marino

San Marino has an open border (though it is not a Schengen state) and customs union (since 2002, including agriculture) with the Union; it also uses the euro and is allowed to mint its own coins. The left-wing opposition Popular Alliance has been reported to be in favour of joining the EU, which the ruling San Marinese Christian Democratic Party opposes.[5]

Vatican City

The Vatican City is the smallest state in the world. As a theocracy, it cannot join the Union (Art 49 TEU), even though it is in the heart of Rome, the capital of Union member-state Italy. It does, however, have an open border with Italy, along with a desire to join the Schengen Information System.

It uses and mints the euro officially. Being the smallest country minting them, its coins have become extremely rare and the hardest and most expensive to collect of any of the microstate coins.[citation needed]

Summary

San Marino, Monaco, and the Vatican City use the euro and have been granted the right to mint a limited number of euro coins. They were allowed to do so, having used or been tied to the old eurozone currencies, and all have open borders. Andorra also uses the euro and is currently in negotiations with the EU to be granted the right to mint its own coins. This was scheduled to happen in 2009.

All but Andorra are part of the Schengen Agreement or have an open border with the Union. San Marino and Andorra are in a customs union with the bloc. All of the microstates are also part of other organisations such as the Council of Europe and the Organisation for Security and Co-operation in Europe (the Vatican is member only of the OSCE).

This table summarises the various components of EU laws applied in the microstates. Some territories of EU member states also have a special status in regard to EU laws applied as is the case with some European Free Trade Association members and their sovereign territories.

Microstates Application of EU law Enforceable in local courts Schengen Area EU VAT area EU customs territory EU single market Eurozone
 Andorra Template:Bg-yellow | Minimal Unclear No No Template:Bg-yellow | Partial[6] No Template:Bg-yellow | Unilaterally adopted
 Liechtenstein Template:Bg-yellow | Partial Unclear Template:Bg-yellow | Set to implement later No No Yes[7] No, CHF
 Monaco Template:Bg-yellow | With exemptions Unclear Yes[8] Yes[8][9] Yes[8][10] Template:Bg-yellow | Partial[citation needed] Yes[8]
 San Marino Template:Bg-yellow | Minimal Unclear Template:Bg-yellow | Open border[11] Template:Bg-yellow | Partial[12][13] Template:Bg-yellow | Partial[6] No Yes[12]
 Vatican City No No Template:Bg-yellow | Open border[14] No No No Yes[12]

See also

References

  1. ^ http://www.cid.harvard.edu/archive/events/docs/zoega_herbertsson.pdf
  2. ^ Finding Andorra's place in the world internationalspecialreports.com
  3. ^ The EU's relations with Monaco, European Commission, December 2005
  4. ^ AGREEMENT between the European Community and the Principality of Monaco providing for measures equivalent to those laid down in Council Directive 2003/48/EC "europa.eu". January 2005
  5. ^ 'Oldest republic' torn by poll-rig claims, The Australian, 2006-06-06
  6. ^ a b Customs union with some goods excluded. [1], [2]
  7. ^ European Economic Area
  8. ^ a b c d Through agreement with France
  9. ^ Commission proposal for Council directive on the common system of value added tax
  10. ^ Article 3(1) of Council Regulation 2913/92/EEC of 12 October 1992 establishing the Community Customs Code (as amended) (OJ L 302, 19.10.1992, p. 1-50) [3].
  11. ^ Although not formally part of the Schengen area, has an open border with Italy (although some random checks are made by Carabinieri, Polizia di San Marino and Guardia di Finanza).
  12. ^ a b c Through agreement with Italy
  13. ^ part of the excise territory only and not of the VAT territory
  14. ^ Has an open border with Italy and has shown an interest in joining the agreement formally for closer cooperation in information sharing and similar activities covered by the Schengen Information System

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