The Schengen Agreement was signed by five European Economic Community member states: Belgium, France, Luxembourg, the Netherlands, and West Germany. The location of the signing was the small village of Schengen in Luxembourg, from which the agreement derives its name. Initiated in response to the growing desire for mobility among European citizens, the Schengen Agreement effectively eliminated internal border controls between the signatory countries. This agreement allowed individuals to travel freely across borders without the need for passports or customs checks, paving the way for what would later become a broader Schengen Area that included additional European nations.

The agreement was part of a larger trend towards integration in Europe, driven by political, economic, and social factors. The signatory nations aimed to enhance their cooperation on border security and law enforcement while promoting economic ties and travel. The Schengen Agreement represented a shift focusing on the need for greater unity among European states, addressing concerns about the free flow of people across borders following the liberalized trade policies that had emerged in the post-World War II era. Over time, this agreement led to the establishment of a common visa policy and led to the development of the Schengen Area, which would further expand in the coming years.

By enabling citizens to navigate across borders with minimal restrictions, the Schengen Agreement fostered increased cultural exchange and economic collaboration among member nations. It presented an initiative to strengthen Europe as a unified region, setting the stage for further advancements in governance and policies in the years to come. Over time, the agreement faced challenges, particularly during times of crisis, with some nations reinstating border controls. Nevertheless, the fundamental principles established by the Schengen Agreement remain integral to European Union cooperation.