Why don't we be like Norway, outside the EU?

January 21, 2016 10:37 PM

Norway is a very prosperous country, much richer than most EU countries, with huge oil and gas reserves, but independence comes at a price.

A few years ago a central heating boiler maker discovered that the EU was introducing new environmental and energy efficiency standards that favoured gas powered boilers over electric ones. Half the company's products would soon be useless: unsaleable.

New machinery and robots that were needed to install better insulation onto the boilers -- in all it has cost the company £5m of extra investment.

As Norway is not a member of the EU, it has no say over these or any other EU rules. It can lobby against them, but it does not sit round the table when they are proposed, discussed, amended, debated, or voted into law.

With a large domestic market, why didn't the company just turn its back on the European Union and its new rules and ignore them. The answer is that it can't.

This is a key factor of the Norwegian model; Norway is not in the EU, but it is in the European Economic Area (EEA), and technically it is as much a part of the single market as France, Germany or the UK.

Legislation comes from the EU and is implemented in Norway in exactly the same way as the rest of the EU with no exceptions and no adaptations to Norwegian conditions

More than just a free trade area the EU coordinates and enforces common rules, regulations and standards, so any manufacturer anywhere in the EU can sell in any other part of the EU.

Many companies in Norway have to follow the rules of the single market even if they have never exported so much as a single widget to the European Union.

That is just one of the costs of Norway's non-membership of the EU.

It does a higher percentage of its trade with the EU than we in the UK do, in fact more than the vast majority of EU members do.

But it pays hundreds of millions of pounds a year for the right to do that and has to accept all the rules and regulations without a say in how they are made.

This is an edited version of an article previously published by the BBC.