Negotiations regarding the EU Framework Agreement between the Swiss government and the EU broke down in May 2021. As a consequence the EU has removed Switzerland, along with the UK, from the list of participants in the Horizon Europe Research Program.
Although the Swiss have voted in the past against joining the EU, the Swiss federal government has negotiated a number of specific bilateral agreements with Brussels which are seen by some as “membership in kind”. Brussels now wishes to package these agreements into an “all or nothing” framework to bring Switzerland under closer effective control. However substantial barriers remain to find a framework that would not damage Switzerland’s celebrated bottom-up federal democracy.
Since the previous talks ended in 2021 there have been more meetings between the two countries and today it seems that the EU agrees with the packaged approached proposed by Switzerland, although many questions remain unanswered, more so for Switzerland.
Leading the bilateral talks for the last two years for Switzerland with the EU, is senior Swiss diplomat Mrs Livia Leu. Mrs Leu was appointed by the Federal Council as State Secretary for Foreign Affairs and Chief Negotiator for the negotiations with the European Union in October 2020.
According to recent reports, there has been movement in the relationship discussions, with exploratory talks being held since the end of March this year. The focus here is on the package approach proposed by Switzerland. The main points of discussion:
- Institutional issues that are very important to the EU.
- The package approach which is important to Switzerland and which provides additional agreements, and also safeguards programme cooperations such as with Horizon Europe program.
It seems that to date, the parties have a clearer understanding of the areas that are important to each other – however, there are obviously still questions that are unanswered.
Possible discussion points to take into negotiations
- With some movement noted in the bi-lateral relationship, the EU appear to want to stall the process for now, whereas Switzerland is still interested in trying to keep the discussion process going.
- Two important points for Switzerland to clarify further are wage protection and immigration. Switzerland is looking for assurances from the EU on both these topics before it can move forward and negotiate further.
- The EU has signalled concessions can be discussed in the Freedom of Movement. This is a complex subject in terms of the EUR Citizens Rights Directive and Switzerland’s interest in wage protection and immigration.
Freedom of movement – Swiss perspective
- The bilateral Agreement on the Free Movement of Persons
This agreement confers upon Swiss citizens and those of the EU the right to freely choose the country of employment and residence within the national territories of the countries that signed the agreement. This is conditional on possession of a valid employment contract, or being self-employed and proof of financial independence and Swiss or equivalent health-insurance cover. The agreement is further extended through the coordination of social security systems and the EU’s system of diploma recognition. And the agreement gradually introduced the rules of free movement between Switzerland and the EU. - In addition to the above accompanying measures to better protect workers against the risk of wage and social undercutting linked to the free movement of persons. According to official sources in Switzerland:
- The measures allow checks on compliance – for minimum or standard working and pay conditions in the workplace. This, in defence of all workers in Switzerland, whether Swiss nationals or resident foreigners.
- The supervisory authorities verified Swiss working and pay conditions in 2018 in 42’000 companies totalling almost 173’000 workers.
- The efficiency of the accompanying measures is being continually monitored, including with new member States. And new measures are decided upon by Swiss authorities on a regular basis in order to ensure appropriate legislative instruments – also for posted foreign workers.
- The law includes an increase in the maximum sanction from CHF 5’000 to CHF 30’000 for violations pertaining to the minimum working and salary conditions.
- Additionally, the sanction measures have been reinforced through the introduction of an accumulation of fines and prohibitions to work in serious cases.
It is key therefore for Switzerland to maintain pay and working conditions for the workplace in Switzerland and the influx of foreign workers and companies, make this an important ongoing discussion point with the EU.
- Immigration
This subject is also a key discussion point for Switzerland and under the umbrella of the system of “direct democracy”, which is absolutely fundamental to Switzerland and the Swiss culture, the Swiss electorate rejected the initiative “For moderate immigration” by 61.71% in September 2020.- In rejecting this initiative, the Swiss people confirmed their commitment to the free movement of persons and their willingness to pursue the bilateral approach with the EU.
- The Federal Council, the cantons and the social partners, who had opposed the initiative, welcomed its broad rejection by the Swiss people.
In Summary: bilateral talks between the EU and Switzerland were stalled in 2021. Two of the main issues of contention and ongoing discussion are centred around the free movement of persons and associated wage and work condition protection as well as immigration. The Swiss delegation is keen to continue discussions with the EU and is now laying groundwork to clarify its position with the EU. Time will tell how this works out, but one thing is for sure, Switzerland needs both foreign skilled workers and a health trade partnership with the EU.
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