The common market is a group of countries that promote duty free trade and free movement of labor and capital among its members through establishing a customs union with a common external tariff and common policies for agriculture, transport, and trade. The European Economic Community established by the Treaty of Rome in 1957 is an example of a common market that aimed to integrate Europe economically and prevent future wars.

1. What is the common market?
Group formed by countries within a geographical area to promote
duty free trade and free movement of labor and capital among its
members. European community (as a legal entity within the
framework of European Union) is the best known example. Common
markets impose common external tariff (CET) on imports from non-
member countries.
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2. Benefits and costs
 A single market has many benefits. With full freedom of movement for all the factors of
production between the member countries, the factors of production become more
efficiently allocated, further increasing productivity.

 For both business within the market and consumers, a single market is a very competitive
environment, making the existence of monopolies more difficult. This means that
inefficient companies will suffer a loss of market share and may have to close down.
However, efficient firms can benefit from economies of scale, increased competitiveness
and lower costs, as well as expect profitability to be a result. Consumers are benefited by
the single market in the sense that the competitive environment brings them cheaper
products, more efficient providers of products and also increased choice of products.
What is more, businesses in competition will innovate to create new products; another
benefit for consumers.
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 Transition to a single market can have short term negative impact on some sectors of a
national economy due to increased international competition. Enterprises that
previously enjoyed national market protection and national subsidy (and could therefore
continue in business despite falling short of international performance benchmarks) may
struggle to survive against their more efficient peers, even for its traditional markets.
Ultimately, if the enterprise fails to improve its organization and methods, it will fail. The
consequence may be unemployment or migration.

4. History
 Background

 In 1951, the Treaty of Paris was signed, creating the European Coal and Steel Community (ECSC). This
was an international community based on supranationalism and international law, designed to help
the economy of Europe and prevent future war by integrating its members.

 In the aim of creating a federal Europe two further communities were proposed: a European Defence
Community (EDC) and a European Political Community (EPC). While the treaty for the latter was
being drawn up by the Common Assembly, the ECSC parliamentary chamber, the EDC was rejected
by the French Parliament. President Jean Monnet, a leading figure behind the communities, resigned
from the High Authority in protest and began work on alternative communities, based on economic
integration rather than political integration.After the Messina Conference in 1955, Paul Henri Spaak
was given the task to prepare a report on the idea of a customs union. The so-called Spaak Report[3]
of the Spaak Committee formed the cornerstone of the intergovernmental negotiations at Val
Duchesse castle in 1956. Together with the Ohlin Report the Spaak Report would provide the basis for
the Treaty of Rome.

 In 1956, Paul Henri Spaak led the Intergovernmental Conference on the Common Market and
Euratom at the Val Duchesse castle, which prepared for the Treaty of Rome in 1957. The conference
led to the signature, on 25 March 1957, of the Treaty of Rome establishing a European Economic
Community.

5. Aims
 1.The establishment of a customs union with a
common external tariff
 2.Common policies for agriculture, transport and
trade
 3.Enlargement of the EEC to the rest of Europe

6. Parliament
 The European Parliament held its first elections in 1979, slowly gaining more influence
over Community decision making.
 Under the Community, the European Parliament (formerly the European Parliamentary
Assembly) had an advisory role to the Council and Commission. There were a number of
Community legislative procedures, at first there was only the consultation
procedure, which meant Parliament had to be consulted, although it was often ignored.
The Single European Act gave Parliament more power, with the assent procedure giving it
a right to veto proposals and the cooperation procedure giving it equal power with the
Council if the Council was not unanimous.

 In 1970 and 1975, the Budgetary treaties gave Parliament power over the Community
budget. The Parliament's members, up-until 1979 were national MPs serving part-time in
the Parliament. The Treaties of Rome had required elections to be held once the Council
had decided on a voting system, but this did not happen and elections were delayed until
1979 (see European Parliament election, 1979). After that, Parliament was elected every
five years. In the following 20 years, it gradually won co-decision powers with the Council
over the adoption of legislation, the right to approve or reject the appointment of the
Commission President and the Commission as a whole, and the right to approve or reject
international agreements entered into by the Community

7. Commission
 The Commission of the European Communities was the
executive arm of the community, drafting Community
law, dealing with the day to running of the Community and
upholding the treaties. It was designed to be
independent, representing the Community interest, but
was composed of national representatives (two from each
of the larger states, one from the smaller states). One of its
members was the President, appointed by the Council, who
chaired the body and represented it.

8. Council
 The Council of the European Communities was a body holding legislative and executive powers and
was thus the main decision making body of the Community. Its Presidency rotated between the states
every six months and it is related to the European Council, which was an informal gather of national
leaders (started in 1961) on the same basis as the Council.
 The Council was composed of one national ministers from each state. However the Council meets in
various forms depending upon the topic. For example, if agriculture was being discussed, the Council
would be composed of each national minister for agriculture. They represented their governments
and were accountable to their national political systems. Votes were taken either by majority (with
votes allocated according to population) or unanimity. In these various forms they share some
legislative and budgetary power of the Parliament. Since the 196 as the Council also began to meet
informally at the level of national leaders; these European summits followed the same presidency
system and secretariat as the Council but was not a formal formation of it.

9. Institutions
 There were three political institutions which held the executive and legislative power of
the EEC, plus one judicial institution and a fifth body created in 1975. These institutions
(except for the Auditors) were created in 1957 by the EEC but from 1967 onwards they
applied to all three Communities. The Council represents governments, the Parliament
represents citizens and the Commission represents the European interest.
Essentially, the Council, Parliament or another party place a request for legislation to the
Commission. The Commission then drafts this and presents it to the Council for approval
and the Parliament for an opinion (in some cases it had a veto, depending upon the
legislative procedure in use). The Commission's duty is to ensure it is implemented by
dealing with the day-to-day running of the Union and taking others to Court if they fail
to comply.[22] After the Maastricht treaty in 1993, these institutions became those of the
European Union, though limited in some areas due to the pillar structure. Despite
this, Parliament in particular has gained more power over legislation and security of the
Commission. The Court was the highest authority in the law, settling legal disputes in the
Community, while the Auditors had no power but to investigate.