asked the Secretary of State for Foreign and Commonwealth Affairs what restrictions apply to the industrial, regional, and coal and steel policies of the EFTA countries under the free trade agreements they have negotiated with the European Communities, in the light of the declaration made by the Communities; and how far these restrictions differ from those applying to the members of the Communities.
The agreements between the EFTA countries and the EEC contain provisions specifying that various practices in the field of industrial and regional policy are incompatible with the functioning of the agreements. The standard formulation is that used in Article 23(1) of the agreement between Norway and the EEC (Cmnd. 5556):
There are identical provisions in the agreements between the EFTA countries—with the exception of Iceland—and the European Coal and Steel Community—for example, Article 19 of the agreement between Sweden and the ECSC (Cmnd. 5657)."1. The following are incompatible with the proper functioning of the Agreement in so far as they may affect trade between the Community and Norway:
(i) all agreements between undertakings, decisions by associations of undertakings and concerted practices between undertakings which have as their object or effect the prevention, restriction or distortion of competition as regards the production of or trade in goods; (ii) abuse by one or more undertakings of a dominant position in the territories of the Contracting Parties as a whole or in a substantial part thereof; (iii) any public aid which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods."
The formulation of these provisions is based directly upon, and is intended to have the same effect as, Articles 85, 86 and 92(1) of the EEC Treaty, in relations between the EEC and ECSC and the EFTA countries.
In the agreements with the ECSC the EFTA countries, with the exception of Iceland and Switzerland, also bind themselves to observe with respect to trade with the Community certain practices followed by the Community in the matter of pricing—for example, Article 20 of the agreement between the ECSC and Sweden (Cmnd. 5657).