The European Union and the Schengen Area represent two entirely different concepts within the same continent.
What is the the European Union?
The European Union (EU) is a political and economic union consisting of the 28 member states. It was originally established to promote peace on the continent but has grown in importance since its birth.
EU countries have autonomy over many aspects of their policy making including foreign policy, but are bound to the judicial and legislative institutions of the EU.
The single market, a singular internal market between the member states, allows for the free movement of people, goods, services, and money. EU citizens have the absolute freedom to study, work, live and retire in any European Union country.
However, these rights do not apply to citizens from non-EU countries. Visitors to the EU can travel freely between countries in the Schengen Area, after entering one of them, but not all EU countries are in the Schengen Area.
What is the Schengen Area?
Schengen countries are those European countries which have signed the Schengen Agreement. These countries operate with no internal border controls, allowing for free movement between the participating countries.
There are currently 26 Schengen member states. The majority of them are countries which are in the European Union (EU). However, two EU countries, the UK and Ireland decided to opt out of Schengen.
There are also four countries which are in the Schengen Area but are not EU member states: Iceland, Norway, Switzerland, and Liechenstein. Three microstates are also included in the Schengen Area: Monaco, Vatican City, and San Marino.
What’s the difference between the EU and the Schengen Area?
In short, they are too different entities although many countries are included in both. The EU is a political and economic union, whereas the Schengen Area allows for the free movement of people between the participating countries.