WORLD TRADE
ORGANIZATIONWT/REG154/1
7 July 2003
(03-3616)
Committee on Regional Trade Agreements Original:  English
EUROPEAN FREE TRADE ASSOCIATION
The following text reproduces the consolidated version of the Convention establishing the
European Free Trade Association.*
_______________
CONSOLIDATED VERSION OF THE CONVENTION ESTABLISHING
THE EUROPEAN FREE TRADE ASSOCIATION
The Republic of Iceland , the Principality of Liechtenstein , the Kingdom of Norway  and the
Swiss Confederation  (hereinafter referred to as the “Member States”);
Having regard  to the conclusion on 4 January 1960, between the Republic of Austria, the
Kingdom of Denmark, the Kingdom of Norway, th e Portuguese Republic, the Kingdom of Sweden,
the Swiss Confederation and the United Kingdom of Great Britain and Northern Ireland, of the
Convention establishing the European Free Trade Association (hereinafter referred to as the“Convention”);
Having regard  to the association with the Republic of Finland and its subsequent accession
on 1 January 1986, and to the accessions by the Republic of Iceland on 1 March 1970 and by the
Principality of Liechtenstein on 1 September 1991;
Having regard  to the successive withdrawals from the Convention by the Kingdom of
Denmark and the United Kingdom on 1 January 1973;  the Republic of Portugal on 1 January 1986;
the Republic of Austria, the Republic of Finland and the Kingdom of Sweden on 1 January 1995;
Having regard  to the free trade agreements between the Member States on the one hand and
third parties on the other;
Reaffirming  the high priority they attach to the privileged relationship between the Member
States and to the facilitation of continuity in their respective good relations with the European Union,
which are based on proximity, long-standing common values and European identity;
Resolved  to deepen the co-operation instituted within the European Free Trade Association,
further facilitating the free movement of goods, aiming at the progressive attainment of free
movement of persons and the progressive liberalisation of trade in services and investment, further
opening up the public procurement markets in the EFTA States, and providing for the appropriate
protection of intellectual property rights, under fair conditions of competition;
Building  on their respective rights and obligations under the Agreement establishing the
World Trade Organization and other multilateral and bilateral instruments of co-operation;
                                                     
* The full text of the Agreement together with its annexes and protocol is available on the EFTA
website ( http://www.efta.int ).WT/REG154/1
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Recognising  the need for mutually supportive trade and environmental policies in order to
achieve the objective of sustainable development;
Affirming  their commitment to the observance of r ecognised core labour standards, noting
their endeavours to promote such standards in the appropriate multilateral fora and expressing their
belief that economic growth and development fostered by increased trade and further tradeliberalisation contribute to the promotion of these standards;
Have agreed  as follows:
CHAPTER I: OBJECTIVES
Article 1
The Association
An international organisation to be known as the European Free Trade Association,
hereinafter referred to as "the Association", is hereby established.
Article 2
Objectives
The objectives of the Association shall be:(a) to promote a continued and balanced strengthening of trade and economic relations
between the Member States with fair conditions of competition, and the respect ofequivalent rules, within the area of the Association;
(b) the free trade in goods;
(c) to progressively liberalise the free movement of persons;
(d) the progressive liberalisation of trade in services and of investment;
(e) to provide fair conditions of competition affecting trade between the Member States;
(f) to open the public procurement markets of the Member States;
(g) to provide appropriate protection of intellectual property rights, in accordance with
the highest international standards.
CHAPTER II: FREE MOVEMENT OF GOODS
Article 3
Customs Duties On Imports And Exports, And Charges Having Equivalent Effect
Customs duties on imports and exports, and any charges having equivalent effect, shall be
prohibited between the Member States. This shall also apply to customs duties of a fiscal nature.WT/REG154/1
Page 3
Article 4
Internal Taxation
1. No Member State shall impose, directly or indirectly, on the products of other Member States
any internal taxation of any kind in excess of that imposed directly or indirectly on similar domesticproducts.
2. Furthermore, no Member State shall impose on the products of other Member States any
internal taxation of such a nature as to afford indirect protection to other products.
3. Where products are exported to the territory of any Member State, any repayment of internal
taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
Article 5
Rules Of Origin
The rules of origin and methods of administrative cooperation in customs administration are
set out in Annex A.
Article 6
Mutual Assistance In Customs Matters
1. Member States shall assist each other in customs matters in general in accordance with the
provisions of Annex B in order to ensure that their customs legislation is correctly applied.
2. Annex B shall apply to all products whether or not covered by the provisions of this
Convention.
Article 7
Quantitative Restrictions On Imports And Exports, And Measures Having Equivalent Effect
Quantitative restrictions on imports and exports, and all measures having equivalent effect,
shall be prohibited between the Member States.
Article 8
Agricultural Goods
1. In view of the special considerations affecting agriculture, the basic agricultural goods and the
goods processed from agricultural raw materials listed in Annex C shall be subject to the following
rules:
(a) In relation to the goods listed in Part I of Annex C, the provisions of this Convention
shall apply, with due regard to the arrangements provided for in Article 9.
(b) In relation to goods listed in Part II or in Part III of Annex C, and with due regard to
the arrangements provided for in Article 9, Articles 2, 3, 4 and 7 shall not apply.
(c) In relation to the goods listed in Part III of Annex C, the Member States declare their
readiness to foster, in so far as their agricultural policies allow, the harmonious
development of trade. In pursuance of this objective, Iceland shall grant tariffWT/REG154/1
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concessions to agricultural products originating in Norway and Switzerland1 as
specified in Table 1 of Annex D, Norway shall grant tariff concessions to agricultural
products originating in Iceland and Switzerland2 as specified in Table 2 of Annex D,
and Switzerland3 shall grant tariff concessions to agricultural products originating in
Iceland and Norway as specified in Table 3 of Annex D. Article 15 of Annex A shall
not apply to goods listed  in Part III of Annex C.
2. Chapter IV on State aid, Chapter VI on competition and Chapter XII on public procurement
shall not apply to agricultural goods.
Article 9
Parts I And II - Goods Of Anne x C (Processed Agricultural Goods)
1. In order to take account of differences in the cost of the agricultural raw materials
incorporated in the goods specified in Part I of Annex C referred to in sub-paragraph (a) of Article 8,
the Convention does not preclude, in respect of such goods:
(a) the levying, upon import, of a fixed duty;
(b) the application of internal price compensation measures;
(c) the application of measures adopted upon export.
2. The fixed duties, levied upon import of goods listed in Part I of Annex C, shall be based on,
but not exceed, the differences between the domestic price and the world market price of the
agricultural raw materials incorporated into the goods concerned.
3. With due regard to the provisions in paragraph 2, no Member State shall accord to imports of
goods listed in Part I or in Part II of Annex C from the territory of another Member State a treatmentless favourable than it accords to imports from th e territory of the European Community or any other
free trade partner.
4. The Member States shall notify each other of all changes in the treatment for products listed
in Part I or in Part II of Annex C accorded to th e European Community or any other free trade partner.
Article 10
Fish And Other Marine Products
The provisions of this Convention shall apply in  relation to fish and other marine products.
Article 11
Seeds And Organic Agriculture
1. Specific rules on seeds are set out in Annex E.
2. Specific rules on organic agriculture are set out in Annex F.
                                                     
1 Also applies to the Principality of Liechtenstein as long as its Customs Union Treaty of 29 March
1923 with Switzerland remains in force.
2 Also applies to the Principality of Liechtenstein as long as its Customs Union Treaty of 29 March
1923 with Switzerland remains in force.
3 Also applies to the Principality of Liechtenstein as long as its Customs Union Treaty of 29 March
1923 with Switzerland remains in force.WT/REG154/1
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Article 12
Sanitary And Phytosanitary Measures
The rights and obligations of the Member States in respect of sanitary and phytosanitary
measures shall be governed by Annex G.
Article 13
Exceptions
The provisions of Article 7 shall not preclude prohibitions or restrictions on imports, exports
or goods in transit justified on grounds of public morality; public policy or public security; theprotection of health and life of humans, animals or plants and of the environment; the protection of
national treasures possessing artistic, historic or archaeological value; or the protection of industrial
and commercial property. Such prohibitions or restrictions shall not, however, constitute a means of
arbitrary discrimination or a disguised restriction on trade between the Member States.
CHAPTER III: TECHNICAL BARRIERS TO TRADE
Article 14
Notification Of Draft Technical Regulations
1. Member States shall notify to the Council at th e earliest practicable stage all draft technical
regulations or amendments thereto.
2. The provisions on the notification procedure are set out in Annex H.
Article 15
Mutual Recognition Of Conformity Assessment
Without prejudice to Article 7, Switzerland, on the one hand, and Iceland, Liechtenstein and
Norway, on the other, grant mutual acceptance of reports, certificates, authorisations, conformity
marks and manufacturer’s declarations of conformity in accordance with Annex I.
CHAPTER IV: STATE AID
Article 16
State Aid
1. The rights and obligations of the Member States relating to State aid shall be based on Article
XVI of the GATT 1994 and the WTO Agreement on Subsidies and Countervailing Measures, which
are incorporated and made part of the Convention, except as otherwise provided for in Annex Q.
2. Member States shall not apply countervailing measures as provided for under Part V of the
WTO Agreement on Subsidies and Countervailing Measures in relation to any other Member State in
accordance with Article 36.
3. The Member States shall review the scope of application of this Chapter with a view to
extending the disciplines with respect to State aid to the field of services, taking into accountinternational developments in the sector. The reviews shall take place at yearly intervals.WT/REG154/1
Page 6
CHAPTER V: PUBLIC UNDERTAKINGS AND MONOPOLIES
Article 17
Public Undertakings And Monopolies
1. Member States shall ensure that public undertakings refrain from applying:
(a) measures the effect of which is to afford protection to domestic production which
would be inconsistent with this Convention if achieved by means of a duty or charge
with equivalent effect, quantitative restriction or government aid, or
(b) trade discrimination on grounds of nationality in so far as it frustrates the benefits
expected from the removal or absence of duties and quantitative restrictions on tradebetween Member States.
2. For the purposes of this Article, “public undertakings” means central, regional, or local
government authorities, public enterprises and any other organisation by means of which a Member
State, by law or in practice, controls or appreciably influences imports from, or exports to, the
territory of a Member State.
3. The provisions of paragraph 1 of Article 18 shall also apply to the activities of public
undertakings, and undertakings for which the Member States grant special or exclusive rights, in so
far as the application of these provisions does not obstruct the performance, in law or in fact, of the
particular public tasks assigned to them.
4. Paragraph 3 shall apply to Annex Q. The Member States shall review the scope of application
of this Chapter with a view to extending the disciplines to other services, taking into account
international developments in the sector. The reviews shall take place at yearly intervals.
5. Member States shall ensure that new practices of the kind described in paragraph 1 of this
Article are not introduced.
6. Where Member States do not have the necessary legal powers to control the activities of
regional or local government authorities or enterpri ses under their control in these matters, they shall
nevertheless endeavour to ensure that those authorities or enterprises comply with the provisions of
this Article.
CHAPTER VI: RULES OF COMPETITION
Article 18
Competition
1. Member States recognise that the following practices are incompatible with this Convention
in so far as they frustrate the benefits arising from this Convention:
(a) agreements between enterprises, decisions by associations of enterprises and
concerted practices between enterprises which have as their object or result the
prevention, restriction or distortion of competition;
(b) abuse by one or more undertakings of a dominant position in the territories of the
Member States as a whole or in a substantial part thereof.WT/REG154/1
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2. Should a Member State consider that a given practice is incompatible with this Article, it may
ask for consultations in accordance with the procedures set out in Article 47 and take appropriate
measures under the conditions set out in paragraph 2 of Article 40 to deal with the difficulties
resulting from the practice in question.
CHAPTER VII: PROTECTION OF INTELLECTUAL PROPERTY
Article 19
1. Member States shall grant and ensure adequate and effective protection of intellectual
property rights, and provide for measures for the enforcement of such rights against infringement
thereof, counterfeiting and piracy, in accordance with the provisions of this Article, Annex J and the
international agreements referred to therein.
2. Member States shall accord to each other’s nationals treatment no less favourable than that
they accord to their own nationals. Exemptions from this obligation must be in accordance with the
substantive provisions of Article 3 of the TRIPS Agreement.
3. Member States shall grant to each other’s nationals treatment no less favourable than that
accorded to nationals of any other State. Exempti ons from this obligation must be in accordance with
the substantive provisions of the TRIPS Agreement, in particular Articles 4 and 5 thereof.
4. Member States agree, upon request of any Member State, to review the provisions on the
protection of intellectual property rights contained in the present Article and in Annex J, with a view
to further improve levels of protection and to avoid or remedy trade distortions caused by actual levels
of protection of intellectual property rights.
CHAPTER VIII: FREE MOVEMENT OF PERSONS
Article 20
Movement Of Persons
1. Freedom of movement of persons shall be secured among Member States in accordance with
the provisions set out in Annex K and in the Protocol to Annex K on the free movement of persons
between Liechtenstein and Switzerland.
2. The objective of this Article for the benefit of the nationals of the Member States shall be:
(a) to accord a right of entry, residence, access to work as employed persons,
establishment on a self-employed basis and the right to stay in the territory of the
Member States;
(b) to facilitate the provision of services in the territory of the Member States, and in
particular to liberalise the provision of services of brief duration;
(c) to accord a right of entry into, and residence in, the territory of the Member States to
persons without an economic activity in the host State;
(d) to accord the same living, employment and working conditions as those accorded to
nationals.WT/REG154/1
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Article 21
Coordination Of Social Security Systems
In order to provide freedom of movement of persons, the Member States shall make
provision, in accordance with Appendix 2 of Annex K and with the Protocol to Annex K on the freemovement of persons between Liechtenstein and Switzerland, for the coordination of social security
systems with the aim in particular of:
(a) securing equality of treatment;
(b) determining the legislation applicable;
(c) aggregating, for the purpose of acquiring and retaining the right to benefit and of
calculating the amount of benefit, of all periods taken into consideration by thenational legislation of the States concerned;
(d) paying benefits to persons resident in the territories of the Member States;
(e) fostering mutual administrative assistance and cooperation between authorities and
institutions.
Article 22
Mutual Recognition Of Professional Qualifications
In order to make it easier for nationals of the Member States to take up and pursue activities
as workers and self-employed persons, the Member States shall take the necessary measures, ascontained in Appendix 3 to Annex K and in the Protocol to Annex K on the free movement of persons
between Liechtenstein and Switzerland, concerning the mutual recognition of diplomas, certificates
and other evidence of formal qualifications, and the coordination of the provisions laid down by law,
regulation or administrative action in the Member States concerning the taking up and pursuit of
activities by workers and self-employed persons.
CHAPTER IX: INVESTMENT
Section I: Establishment
Article 23
Principles And Scope
1. Within the framework of, and subject to, the pr ovisions of this Convention, there shall be no
restrictions on the right of establishment of companie s or firms, formed in accordance with the law of
a Member State and having their registered office, central administration or principal place of
business in the territory of the Member States. This shall also apply to the setting up of agencies,
branches or subsidiaries by companies or firms of any Member State established in the territory of any
other Member State.
The right of establishment shall include the right to set up, acquire and manage undertakings,
in particular companies or firms within the mean ing of paragraph 2, under the conditions laid down
for its own undertakings by the law of the Member State where such establishment is effected, subject
to the provisions set out hereafter.WT/REG154/1
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2. For the purposes of this Chapter:
(a) “subsidiary” of a company shall mean a company which is effectively controlled by
the first company;
(b) “companies or firms” shall mean companies or firms constituted under civil or
commercial law, including cooperative societies, and other legal persons governed by
public or private law, save for those which are non-profit-making; in order to beconsidered as a company or firm of a Member State, the company or firm shall have a
real and continuous link with the economy in that Member State.
3. Annexes L to O contain specific provisions and exemptions regarding the right of
establishment. The Member States shall endeavour to eliminate gradually remaining discriminations,
which they may maintain in accordance with Annexes L to O.  The Member States agree to review the
present provision, including its Annexes, within two years after the entry into force of the Agreement
amending the Convention establishing the European  Free Trade Association of 21 June 2001 with a
view to reducing, and ultimately eliminating, the remaining restrictions.
4. From the date of entry into force of the Agreement amending the Convention establishing the
European Free Trade Association of 21 June 2001, neither Member State shall adopt new, or more,
discriminatory measures as regards the establishment and operation of companies or firms of another
Member State, in comparison with the treatment accorded to its own companies or firms.
5. In sectors covered by an exemption as containe d in Annexes L to O, each Member State shall
accord to companies or firms of another Member State treatment no less favourable than that accorded
to companies or firms of third parties other th an the European Community. As regards any new
agreements concluded between any Member State and the European Community, the Member States
further undertake to extend to each other, on the basis of reciprocity, the benefits of such agreements,subject to a decision by the Council.
6. The right of establishment in the field of road, rail and air transport shall be governed by the
provisions of Article 35 and Annexes P and Q, subject to the specific provisions and exemptions set
out in Annexes L and M.
7. The right of establishment of natural persons shall be governed by the provisions of Article
20, Annexes K and the Protocol to Annex K on movement of persons between Liechtenstein and
Switzerland.
Article 24
National Treatment
1. Within the scope of application of this Chapter, and without prejudice to any special
provisions contained herein:
(a) Member States shall grant treatment no less favourable than that accorded to their
own companies or firms;
(b) each Member State may regulate the establishment and operation of companies or
firms on its territory, in so far as these regulations do not discriminate againstcompanies or firms of the other Member States in comparison to its own companies
or firms.
2. The provisions of this Article do not preclude the application by a Member State of particular
rules concerning the establishment and operation in its territory of branches and agencies ofWT/REG154/1
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companies of another Member State not incorporated in the territory of the first Member State, which
are justified by legal or technical differences between such branches and agencies as compared to
branches and agencies of companies incorporated in  its territory. The difference in treatment shall not
go beyond what is strictly necessary as a result of such legal or technical differences.
Article 25
Financial Market Regulation
1. In respect of financial services, this Chapter does not prejudice the right of the Member States
to adopt measures necessary for prudential grounds in order to ensure the protection of investors,
depositors, policy holders, or persons to whom a fidu ciary duty is owed, or to ensure the integrity and
stability of the financial system. These measures shall not discriminate against companies or firms of
the other Member States in comparison to its own companies or firms.
2. Nothing in this Chapter shall be construed to require a Member State to disclose information
relating to the affairs and accounts of individual customers or any confidential or proprietary
information in the possession of public entities.
Article 26
Recognition
1. A Member State may enter into an agreement or arrangement with a particular State providing
for the recognition of standards, criteria for authorization, licensing or certification of service
suppliers, in which case it shall offer adequate opportunity for any other Member State to negotiate itsaccession to such an agreement or arrangement or to negotiate comparable ones with it.
2. Where a Member State accords recognition as provided for in paragraph 1 autonomously, it
shall afford adequate opportunity for any other Member State to demonstrate that experience, licences
or certifications obtained or requirements met in that other Member State’s territory should be
recognised.
3. A Member State shall not accord recognition in a manner which would constitute a means of
discrimination between countries in the application of its standards or criteria for the authorisation,
licensing or certification of service suppliers, or a disguised restriction to establishment in the services
sector.
Article 27
Exceptions
1. The provisions of this Chapter shall not apply, so far as any given Member State is concerned,
to activities which in that Member State are connected, even occasionally, with the exercise of official
authority.
2. The provisions of this Chapter and measures taken in pursuance thereof shall not prejudice the
applicability of provisions laid down by law, regulation or administrative action providing for special
treatment for foreign companies or firms on grounds of public policy, public security, public health or
the environment.
3. Subject to the requirement that such measures are not applied in a manner which would
constitute a means of arbitrary or unjustifiable discrimination between States where like conditionsprevail, or a disguised restriction on trade in services, nothing in this Convention shall be construed to
prevent the adoption or enforcement by any Member State of measures:WT/REG154/1
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(a) inconsistent with Article 24, provided that the difference in treatment is aimed at
ensuring the equitable or effective4 imposition or collection of direct taxes in respect
of services or service suppliers of other Member States;
(b) inconsistent with paragraph 5 of Article 23, provided that the difference in treatment
is the result of an agreement on the avoidance of double taxation or provisions on the
avoidance of double taxation in any other international agreement or arrangement bywhich the Member State is bound.
Section II: Capital Movement
Article 28
1. Within the framework of this Chapter, there shall be no restrictions between the Member
States on the movement of capital relating to the establishment in another Member State’s territory of
a company or firm of that Member State.
2. The movement of capital not relating to establishment between the Member States shall be
ensured in accordance with the internati onal agreements to which they are parties.
3. The Member States agree to review the present provision within two years after the entry into
force of the Agreement amending the Convention establishing the European Free Trade Association
of 21 June 2001 in order to broaden the scope of, and ultimately eliminate the remaining restrictions
to, the movement of capital.
CHAPTER X: TRADE IN SERVICES
Article 29
Principles And Scope
1. Within the framework of, and subject to, the pr ovisions of this Convention, there shall be no
restrictions on the right to supply services within the territory of the Member States in respect of
                                                     
4 Measures that are aimed at ensuring the equitable or effective imposition or collection of direct taxes
include measures taken by a Member under its taxation system which:
(i) apply to non-resident service suppliers in recognition of the fact that the tax obligation of non-
residents is determined with respect to taxable items sourced or located in the Member State’s
territory; or
(ii) apply to non-residents in order to ensure the imposition or collection of taxes in the Member
State’s territory; or
(iii) apply to non-residents or residents in order to prevent the avoidance or evasion of taxes,
including compliance measures; or
(iv) apply to consumers of services supplied in or from the territory of another Member State in
order to ensure the imposition or collection of taxes of such consumers derived from sources
in the Member State’s territory; or
(v) distinguish service suppliers subject to tax on worldwide taxable items from other service
suppliers, in recognition of the difference in the nature of the tax base between them; or
(vi) determine, allocate or apportion income, profit, gain, loss, deduction or credit of resident
persons or branches, or between related persons or branches of the same person, in order to
safeguard the Member State’s tax base.
Tax terms or concepts in paragraph 3(a) of Article  27 and in this footnote are determined according to
tax definitions and concepts, or equivalent or similar definitions and concepts, under the domestic law of theMember State taking the measure.WT/REG154/1
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natural persons, companies or firms of Member States who are established in a Member State other
than that of the natural person, company or  firm for whom the services are intended.
2. For the purposes of this Chapter, services shall be considered to be “services” within the
meaning of this Convention where they are normally supplied for remuneration:
(a) from the territory of one Member State into the territory of another Member State;
(b) in the territory of a Member State to the service consumer of another Member State in
accordance with paragraph 7 below;
(c) by service supplier of a Member State, through presence of natural persons of that
Member State in the territory of another Member State in accordance with paragraph
7 below.
3. Annexes L to O contain specific provisions and exemptions regarding the right to supply
services. The Member States shall endeavour to eliminate gradually remaining discriminations, which
they may maintain in accordance with Annexes L to O. The Member States agree to review thepresent provision, including its Annexes, within two years after the entry into force of the Agreement
amending the Convention establishing the European  Free Trade Association of 21 June 2001 with a
view to reducing, and ultimately eliminating, the remaining restrictions.
4. From the date of entry into force of the Agreement amending the Convention establishing the
European Free Trade Association of 21 June 2001, neither Member State shall adopt new, or more,discriminatory measures as regards services or service suppliers of another Member State, in
comparison with the treatment accorded to its own like services or service suppliers.
5. In sectors covered by an exemption as containe d in Annexes L to O, each Member State shall
accord to services or service suppliers of another Member State treatment no less favourable than that
accorded to like services or service suppliers of third parties other than the European Community.  Asregards any new agreements concluded between any Member State and the European Community, the
Member States further undertake to extend to each other, on the basis of reciprocity, the benefits of
such agreements, subject to a decision by the Council.
6. The right to supply services in the field of road, rail and air transport shall be governed by the
provisions of Article 35 and Annexes P and Q, subject to the specific provisions and exemptions setout in Annex M.
7. The supply or consumption of services by natural persons as provided for in paragraphs 2(b)
and (c) shall be governed by the relevant provisions of Article 20, Annex K and the Protocol to Annex
K on movement of persons between Liechtenstein and Switzerland, in accordance with the principles
set out hereinafter.
Article 30
National Treatment
Within the scope of application of this Chapter, and without prejudice to any special
provisions contained herein:
(a) Member States shall grant treatment no less favourable than that accorded to their
own natural persons, companies or firms providing services;
(b) each Member State may regulate services activities within its territory in so far as
these regulations do not discriminate against natural persons, companies or firms ofWT/REG154/1
Page 13
the other Member States in comparison to its own natural persons, companies or
firms.
Article 31
Financial Market Regulation
1. In respect of financial services, this Chapter does not prejudice the right of the Member States
to adopt measures necessary for prudential grounds in order to ensure the protection of investors,
depositors, policy holders, or persons to whom a fiduciary duty is owed, or to ensure the integrity and
stability of the financial system. These measures shall not discriminate against natural persons,
companies or firms of the other Member States in comparison to its own natural persons, companies
or firms.
2. Nothing in this Chapter shall be construed to require a Member State to disclose information
relating to the affairs and accounts of individual customers or any confidential or proprietary
information in the possession of public entities.
Article 32
Recognition
1. The mutual recognition between the Member States of diplomas, certificates and other
evidence of formal qualifications, and the coordinatio n of the provisions laid down by law, regulation
or administrative action in the Member States concerning the taking up and pursuit of activities by
natural persons, shall be governed by the relevant provisions of Article 22, Annex K and Appendix 3thereto and the Protocol to Annex K on movement of persons between Liechtenstein and Switzerland.
2. A Member State may enter into an agreement or arrangement with a particular State providing
for the recognition of standards, criteria for authorization, licensing or certification of service
suppliers, in which case it shall offer adequate opportunity for any other Member State to negotiate its
accession to such an agreement or arrangement or to negotiate comparable ones with it.
3. Where a Member State accords recognition as provided for in paragraph 2 autonomously, it
shall afford adequate opportunity for any other Member State to demonstrate that experience, licences
or certifications obtained or requirements met in that other Member State’s territory should be
recognised.
4. A Member State shall not accord recognition in a manner which would constitute a means of
discrimination between countries in the application of its standards or criteria for the authorisation,
licensing or certification of service suppliers, or a disguised restriction to trade in services.
Article 33
Exceptions
1. The provisions of this Chapter shall not apply, so far as any given Member State is concerned,
to activities which in that Member State are connected, even occasionally, with the exercise of official
authority.
2. The provisions of this Chapter and measures taken in pursuance thereof shall not prejudice the
applicability of provisions laid down by law, regulation or administrative action providing for special
treatment of foreign service suppliers on grounds of public policy, public security, public health or theenvironment.WT/REG154/1
Page 14
3. Subject to the requirement that such measures are not applied in a manner which would
constitute a means of arbitrary or unjustifiable discrimination between States where like conditions
prevail, or a disguised restriction on trade in services, nothing in this Convention shall be construed to
prevent the adoption or enforcement by any Member State of measures:
(a) inconsistent with Article 30, provided that the difference in treatment is aimed at
ensuring the equitable or effective5 imposition or collection of direct taxes in respect
of services or service suppliers of other Member States;
(b) inconsistent with paragraph 5 of Article 29, provided that the difference in treatment
is the result of an agreement on the avoidance of double taxation or provisions on the
avoidance of double taxation in any other international agreement or arrangement by
which the Member State is bound.
Article 34
Public Procurement
Nothing in this Chapter shall be construed to  impose any obligations with respect to public
procurement.
Article 35
Transport
The Member States shall liberalise the access to each other’s transport markets for the
carriage of passengers and goods by road, rail and air in accordance with the provisions set out in
Annex P and Annex Q respectively.
CHAPTER XI: DUMPING
Article 36
                                                     
5 Measures that are aimed at ensuring the equitable or effective imposition or collection of direct taxes
include measures taken by a Member under its taxation system which:
(i) apply to non-resident service suppliers in recognition of the fact that the tax obligation of
non-residents is determined with respect to taxable items sourced or located in the MemberStates territory; or
(ii) apply to non-residents in order to ensure the imposition or collection of taxes in the Member
States territory; or
(iii) apply to non-residents or residents in order to prevent the avoidance or evasion of taxes,
including compliance measures; or
(iv) apply to consumers of services supplied in or from the territory of another Member State in
order to ensure the imposition or collection of taxes of such consumers derived from sources
in the Member States territory; or
(v) distinguish service suppliers subject to tax on worldwide taxable items from other service
suppliers, in recognition of the difference in the nature of the tax base between them; or
(vi) determine, allocate or apportion income, profit, gain, loss, deduction or credit of resident
persons or branches, or between related persons or branches of the same person, in order tosafeguard the Member States tax base.
Tax terms or concepts in paragraph 3(a) of Article  27 and in this footnote are determined according to
tax definitions and concepts, or equivalent or similar definitions and concepts, under the domestic law of theMember State taking the measure.WT/REG154/1
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Anti-dumping measures, countervailing duties and measures against illicit commercial
practices attributable to third countries shall not be applied in relations between the Member States.
CHAPTER XII: PUBLIC PROCUREMENT
Article 37
1. The Member States reaffirm their rights and obligations under the WTO Agreement on
Government Procurement (GPA).  Under this C onvention, the Member States broaden the scope of
their commitments under the WTO Government Procurement Agreement with an aim to pursue
liberalisation in public procurement markets in accordance with Annex R.
2. To this effect, the Member States shall secure non-discriminative, transparent and reciprocal
access to their respective public procurement markets and shall ensure open and effective competitionbased on equal treatment.
CHAPTER XIII: CURRENT PAYMENTS
Article 38
Current payments connected with the movement of goods, persons, services or capital as
defined in Article 28 between Member States within the framework of the provisions of this
Convention shall be free of all restrictions.
CHAPTER XIV: EXCEPTIONS AND SAFEGUARDS
Article 39
Security Exceptions
Nothing in this Convention shall prevent a Member State from taking any measures:
(a) which it considers necessary to prevent the disclosure of information contrary to its
essential security interests;
(b) which relate to the production of, or trade in, arms, munitions and war materials or
other products or services indispensable for defence purposes or to research,
development or production indispensable for defence purposes, provided that such
measures do not impair the conditions of competition in respect of products or
services not intended for specifically military purposes;
(c) which it considers essential to its own security in the event of serious internal
disturbances affecting the maintenance of law and order, in time of war or serious
international tension constituting threat of war or in order to carry out obligations it
has accepted for the purpose of maintaining peace and international security.
Article 40
Safeguard Measures
1. If serious economic, societal or environmental difficulties of a sectorial or regional nature
liable to persist are arising, a Member State may unilaterally take appropriate measures under the
conditions and procedures set out in Article 41.WT/REG154/1
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2. Such safeguard measures shall be restricted with regard to their scope and duration to what is
strictly necessary in order to remedy the situation. Priority shall be given to such measures as will
least disturb the functioning of this Convention.
3. The safeguard measures shall apply with regard to all Member States.
4. This Article is without prejudice to the application of specific safeguard provisions set out in
the Annexes to this Convention or of special safegu ard measures in accordance with Article 5 of the
WTO Agreement on Agriculture.
Article 41
1. A Member State which is considering taking safeguard measures under Article 40, shall,
without delay, notify the other Member States through the Council and shall provide all relevant
information.
2. The Member States shall immediately enter into  consultations in the Council with a view to
finding a commonly acceptable solution.
3. The Member State concerned may not take safeguard measures until one month has elapsed
after the date of notification under paragraph 1, unless the consultation procedure under paragraph 2
has been concluded before the expiration of the stated time limit.  When exceptional circumstances
requiring immediate action exclude prior examination, the Member State concerned may applyforthwith the protective measures strictly necessary to remedy the situation.
4. The Member State concerned shall, without delay, notify the measures taken to the Council
and shall provide all relevant information.
5. The safeguard measures taken shall be the subject of consultations in the Council every three
months from the date of their adoption with a view to their abolition before the date of expiryenvisaged, or to the limitation of their scope of application.
Each Member State may at any time reques t the Council to review such measures.
CHAPTER XV: ECONOMIC AND MONETARY POLICY CO-OPERATION
Article 42
The Member States shall exchange views and information concerning the implementation of
this Convention and the impact of the integration on economic activities and on the conduct of
economic and monetary policies. Furthermore, they may discuss macro-economic situations, policies
and prospects. This exchange of views and information shall take place on a non-binding basis.
CHAPTER XVI: INSTITUTIONAL PROVISIONS
Article 43
The Council
1. It shall be the responsibility of the Council:
(a) to exercise such powers and functions as are conferred upon it by this Convention;WT/REG154/1
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(b) to decide on amendments to this Convention in accordance with the provisions
herein;
(c) to supervise the application of this Convention and keep its operation under review;
(d) to consider whether further action should be taken by Member States in order to
promote the attainment of the objectives of the Association;
(e) to facilitate the establishment of closer links with other States and unions of States;
(f) to seek to establish such relationships with other international organisations as may
facilitate the attainment of the objectives of the Association;
(g) to negotiate trade and co-operation agreements between the Member States and any
other State, union of States or international organisation;
(h) to endeavour to resolve disputes that may arise regarding the interpretation or
application of this Convention; and
(i)  to consider any other matter that may affect the operation of this Convention.
2. Each Member State shall be represented in the Council and shall have one vote.
3. The Council may decide to set up such organs, committees and other bodies, as it considers
necessary to assist it in accomplishing its tasks. These organs, committees and other bodies are listed
in Annex S.
4. In exercising its responsibility under this Article, the Council may take decisions, which shall
be binding on all Member States, and may make recommendations to Member States.
5. Decisions and recommendations of the Council shall be made by unanimous vote, except in
so far as this Convention provides otherwise. Decisions or recommendations shall be regarded as
unanimous unless any Member State casts a negati ve vote. Decisions and recommendations which are
to be made by majority vote, require the affirmative vote of three Member States.
6. If the number of the Member States changes, the Council may decide to amend the number of
votes required for decisions and recommendations which are to be made by majority vote.
Article 44
Administrative Arrangements Of The Association
The Council shall take decisions for the following purposes:(a) to lay down the Rules of Procedure of the Council and of any other bodies of the
Association, which may include provision th at procedural questions may be decided
by majority vote;
(b) to make arrangements for the secretariat services required by the Association;
(c) to establish the financial arrangements necessary for the administrative expenses of
the Association, the procedure for establishing a budget and the apportionment of
those expenses between the Member States.WT/REG154/1
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Article 45
Legal Capacity, Privileges And Immunities
1. The legal capacity, privileges and immunities to be recognised and granted by the Member
States in connection with the Association shall be laid down in a Protocol to this Convention.
2. The Council, acting on behalf of the Association, may conclude with the Government of the
State in whose territory the headquarters will be situated an agreement relating to the legal capacity
and the privileges and immunities to be recognised and granted in connection with the Association.
CHAPTER XVII: CONSULTATIONS AND DISPUTE SETTLEMENT
Article 46
Scope
The provisions of this Chapter shall apply to  any matter arising from this Convention, unless
otherwise specified in this Convention.
Article 47
Consultations
1. The Member States shall at all times endeavour to agree on the interpretation and application
of this Convention, and shall make every attempt through cooperation and consultations to arrive at a
mutually satisfactory resolution of any matter that might affect its operation.
2. Any Member State may bring any matter, which concerns the interpretation or application of
this Convention before the Council. The Council sha ll be provided with all information, which might
be of use in making possible an in-depth examin ation of the situation, with a view to finding an
acceptable solution. To this end, the Council shall examine all possibilities to maintain the good
functioning of the Convention.
3. A meeting of the Council shall be held within  30 days from the receipt of the request for
consultations.
Article 48
Arbitration
1. In case a Member State considers that a measure applied by another Member State violates
the Convention and the matter has not been resolved within 45 days after consultations have been held
pursuant to Article 47, such matter may be referred to arbitration by one or more Member Statesparties to the dispute by means of a written notification addressed to the Member State complained
against.  A copy of this notification shall be communicated to all Member States so that each may
determine whether it has a substantial interest in the matter. Where more than one Member State
requests the submission to an arbitration tribunal of a dispute with the same Member State relating to
the same question a single arbitration tribunal should be established to consider such disputeswhenever feasible.
2. A Member State which is not a party to the dispute, on delivery of a written notice to the
disputing Member States, shall be entitled to make written submissions to the arbitration tribunal,WT/REG154/1
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receive written submissions of the disputing Me mber States, attend all hearings and make oral
submissions.
3. The award of the arbitration tribunal shall be final and binding upon the Member States
parties to the dispute and shall be complied with promptly.
4. The establishment and functioning of the arbitration tribunal and the implementation of
arbitral awards are governed by the rules set out in Annex T.
CHAPTER XVIII: GENERAL PROVISIONS
Article 49
Obligations Under Other International Agreements
1. Nothing in this Convention shall be regarded as exempting any Member State from
obligations which it has undertaken by virtue of agreements with third States or multilateral
agreements to which they are parties.
2. This Convention shall be without prejudice to the rules applicable to Member States governed
by the Agreement on the European Economic Area, the Nordic cooperation and the regional unionbetween Switzerland and Liechtenstein.
Article 50
Rights And Obligations Of The Member States
The Member States shall take all appropriate measures, whether general or particular, to
ensure fulfilment of the obligations arising out of this Convention. They shall abstain from any
measure which could jeopardize the attainment of the objectives of this Convention.
Article 51
Transparency
1. The Member States shall publish their laws, or otherwise make publicly available their laws,
regulations, procedures and administrative rulings and judicial decisions of general application as wellas the international agreements which may affect the operation of this Convention.
2. The Member States shall promptly respond to specific questions and provide, upon request,
information to each other on matters referred to in paragraph 1.
Article 52
Confidentiality
The representatives, delegates and experts of the Member States, as well as officials and other
servants acting under this Convention shall be required, even after their duties have ceased, not todisclose information of the kind covered by the obligation of professional secrecy, in particular
information about undertakings, their business relations or their cost components.WT/REG154/1
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Article 53
Annexes
1. The Annexes, Appendices and Protocols to this Convention shall form an integral part of it.
2. The Annexes to this Conv ention are the following:
Annex A on Rules of Origin
Annex B on mutual administrative assistance in customs mattersAnnex C List of agricultural goods and goods processed from agricultural raw
materials referred to in paragraph 1 of Article 8
Annex D List of tariff concessions to agricultural productsAnnex E SeedsAnnex F Organic agricultureAnnex G Sanitary and phytosanitary measures
Annex H Procedure for the provision of information in the field of technical
regulations and of rules on Information Society services
Annex I Mutual recognition in relation to conformity assessment
Annex J Intellectual property rights
Annex K Movement of personsAnnex L Reservations by Iceland on investment and servicesAnnex M Reservations by Liechtenstein on investment and servicesAnnex N Reservations by Norway on investment and servicesAnnex O Reservations by Switzerland on investment and services
Annex P Land transport
Annex Q Air transportAnnex R Public procurementAnnex S Organs, committees and other bodies set up by the CouncilAnnex T Arbitration
Annex U Territorial application
The Council may decide to amend the provisions to this paragraph.WT/REG154/1
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3. The Council may decide to amend Annexes A, C, H, S and T, as well as the Appendices to
Annexes E, F, K, P, Q and R, unless otherwise provided in the Annexes.
4. The Committee established under Annex I may decide to amend Article 4 of that Annex as
well as Appendices 1 and 2 thereto.  It shall inform the Council of its decision-making.
Article 54
Ratification
1. This Convention shall be ratified by the signatory States. The instruments of ratification shall
be deposited with the Government of Sweden, which shall notify all other signatory States.
2. The Government of Norway shall act as Depositary as of 17 November 1995.
3. The Council may decide to amend the provisions of this Article.
Article 55
Entry Into Force
This Convention shall enter into force on the deposit of instruments of ratification by all
signatory States.
Article 56
Accession And Association
1. Any State may accede to this Convention, provided that the Council decides to approve its
accession, on such terms and conditions as may be set out in that decision. The instrument of
accession shall be deposited with the Depositary, which shall notify all other Member States.  This
Convention shall enter into force in relation to an acc eding State on the date indicated in that decision.
2. The Council may negotiate an agreement between  the Member States and any other State,
union of States or international organisation, creating an association embodying such reciprocal rights
and obligations, common actions and special procedur es as may be appropriate. Such an agreement
shall be submitted to the Member States for accepta nce and shall enter into force provided that it is
accepted by all Member States. Instruments of acceptance shall be deposited with the Depositary,
which shall notify all other Member States.
3. Any State acceding to this Convention shall apply to become a party to the free trade
agreements between the Member States on the one hand and third states, unions of states or
international organisations on the other.
Article 57
Withdrawal
1. Any Member State may withdraw from this Conv ention provided that it gives twelve months’
notice in writing to the Depositary, which shall notify all other Member States.
2. Before the withdrawal takes effect, the Member States shall agree on appropriate
arrangements and equitable cost-sharing relating to the withdrawal.WT/REG154/1
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Article 58
Territorial Application
This Convention shall apply to the territories of the Member States except as provided for in
Annex U.
Article 59
Amendment
Except as otherwise provided for in this Conv ention, an amendment to the provisions of this
Convention shall be subject to a decision of the Council which shall be submitted to the MemberStates for acceptance in accordance with their intern al legal requirements. It shall enter into force,
unless otherwise provided, on the first day of the second month following the deposit of the
instruments of acceptance by all Member States with the Depositary, which shall notify all other
Member States.
IN WITNESS WHEREOF the undersigned, duly aut horised thereto, have signed the present
Convention.
DONE at Stockholm this 4th day of January, 1960, in a single copy in the English and French
languages, both texts being equally authentic, which shall be deposited with the Government of
Sweden, by which certified copies shall be transmitted to all other signatory and acceding States.
AMENDED at Vaduz this 21st day of June, 2001, in a single authentic copy in the English
language, which shall be deposited with the Government of Norway.
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