The European Union (EU) is an economic and political union between 27 European countries which, together, account for about 15-20 percent of the world's agricultural exports and imports. Agriculture in the EU member states is regulated by the Common Agricultural Policy (CAP),  which was initiated in 1963 and is based on three major principles:

• a unified market in which there is a free flow of agricultural commodities with common prices within the EU;
• product preference in the internal market over foreign imports through common customs tariffs; and
• financial solidarity through common financing of agricultural programs

The EU Common Agricultural Policy has a major impact on world agricultural markets, and the Union is one of the key participants in World Trade Organization (WTO) negotiations on agricultural trade.  The EU is also one of the most important trading partners and competitors of the United States in world agricultural markets. 

ERS conducts research and analysis on the EU agricultural sector, particularly on issues related to policy, enlargement, and WTO commitments.