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The EU is working on a system of supranational independent institutions and intergovernmental decisions negotiated by member states. The important institutions of the EU are the European Commission, the Council of the European Union, the European Council, the European Court of Justice and the European Central Bank. The European Parliament is elected every five years by EU citizens. The EU has developed an internal market through a standardised legal system that applies to all Member States. Passport controls have been abolished within the Schengen area (which includes EU and third country member states). EU policy aims to ensure the free movement of people, goods, services and capital, to legislate in the areas of justice and home affairs and to maintain common policies in the areas of trade, agriculture, fisheries and regional development. The monetary union, the euro area, was created in 1999 and has been made up of 17 Member States since January 2012. Thanks to the common foreign and security policy, the EU has developed a limited role in external relations and defence. Permanent diplomatic representations have been established around the world. The EU is represented at the United Nations, the WTO, the G8 and the G20. The creation of free trade zones is seen as an exception to the most privileged principle of the World Trade Organization (WTO), since the preferences of the parties to the exclusive granting of a free trade area go beyond their accession obligations. [9] Although GATT Article XXIV authorizes WTO members to establish free trade zones or to conclude interim agreements necessary for their establishment, there are several conditions relating to free trade zones or interim agreements leading to the creation of free trade zones.

Currently, the EU has the largest trade network in the world, with 41 trade agreements in 72 countries. Among the types of EU trade agreements, part of the WTO`s non-discrimination mandate is the status of the most favoured nation (MFN). The status of the most favoured nation requires that a WTO member apply the same conditions for trade with all other WTO members. In other words, if a country gives a special favour to another country (including a non-WTO member), any other WTO member must receive the same treatment. You probably saw a version of the most favoured child status when an adult told you that if you were taking chewing gum or candy to school, you should bring enough for everyone. In other words, you couldn`t just give chewing gum or candy to your best friends, and if you didn`t have enough for everyone in the class, no one would get it.