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When two Member States enter into an agreement to enhance free movement of goods, persons, companies, services or capital, this may cause distortion of the functioning of the internal market. Consequently, the Member States must observe EU law when they adopt such an agreement. This article analyses how the free movement rights may affect such agreements, and it concludes that Member States should be careful not to adopt restrictions to free movement under an agreement. Furthermore, they should be careful not to unjustly exclude goods, persons and companies from Member States that are not party to the agreement from benefiting from the agreement. The most important question is, however, whether the Member States must observe the requirement for most favoured nation treatment when adopting such an agreement. After analysing the existing case law—including the nonconclusive recent judgement in Achmea—it is concluded that Member States are likely to avoid intra-EU agreements being scrutinised under this principle.
