It was a dark day at the end of May 2021 when the Swiss government appeared before the media and announced that it was breaking off negotiations with the EU. After seven years of negotiations, Switzerland found that the existing draft joint agreement did not reflect the country’s interests. The frustration in Brussels was correspondingly great with this small country, which had benefited from a tailor-made relationship with the EU for many years – and which now quite simply said no to the attempt to reorganize the complicated relationship.
Now, almost three years later, the mood between Bern and Brussels is better. There is even the prospect of a new start to negotiations – and above all: a quick conclusion. Both sides announced in December that they wanted to reach an agreement by the end of 2024. The optimism is based on two documents published a few weeks ago: the Swiss draft mandate for negotiations with the EUand the EU draft mandate for negotiations with Bern. As soon as the documents have been officially approved, we can get started.
Switzerland maintains around 120 bilateral agreements with its EU neighbors
Even if the whole thing seems well coordinated and prepared this time, it is still unclear whether Brussels and Bern will actually reach an agreement. The close relationship between Switzerland and the surrounding EU states is not automatic. It is based on around 120 bilateral agreements, some of which are decades old. They enable Switzerland to participate in the internal market largely without barriers in many areas, that citizens of both areas can settle in the other, and that there is cooperation in the area of asylum, border protection and research.
But this collaboration is complicated. If there are changes in EU law that affect Switzerland, the agreements must be updated individually. There is also no authority that decides whether both sides are interpreting the agreements correctly. Some differences have therefore existed for years.
For these reasons, Brussels has long wanted a kind of institutional umbrella for the bilateral agreements with Switzerland, and Bern also showed itself to be open to such an idea early on. The negotiators worked on the draft of an institutional framework agreement for four years, and it was finally available in 2018: In the five market access agreements, Switzerland should practically automatically adopt EU law.
In addition, an arbitration tribunal with equal representation was planned for disputes. But Switzerland was cautious and wanted to renegotiate on some points. Otherwise, she feared, a referendum could overturn the treaty. In Brussels there was less and less understanding for these direct democratic peculiarities – and the Swiss government finally canceled the whole thing in May 2021.
Right-wing politicians effectively raised the mood against a treaty with the EU
The relationship between the actually close partners was in such shambles that they did not begin discussions again until March 2022. Now, 22 months, eleven rounds of exploratory discussions and 46 technical discussions later, both sides apparently feel ready for a second attempt. This time an attempt was made to resolve the still controversial points before the actual negotiations begin.
The core of the new approach, which characterizes both draft mandates: Instead of a framework agreement, the institutional elements should now be written into the individual bilateral agreements – an idea that the Swiss side brought into the discussions. These institutional elements are intended to ensure that the same rules of the game apply to all internal market participants.
Similar to the framework agreement, this involves the quasi-automatic adoption of EU law, the uniform interpretation of the agreements, their monitoring and dispute resolution. In this variant, too, the latter should be carried out by an arbitration tribunal with equal representation, which in certain cases involves the Court of Justice of the European Union (ECJ). With the role of the ECJ, right-wing politicians have effectively stirred up sentiment against a treaty with the EU in recent years. “Foreign judges” who interfere in Swiss affairs: a proven threat in the Swiss Confederation.
Swiss unions fear wage dumping
Another important element of the new negotiations is likely to be the idea of a “non-regression clause” put forward by Brussels. This means that Switzerland does not have to accept any future adjustments to EU posting law if these endanger the level of protection of the high Swiss wages. This point addresses criticism that comes primarily from the Swiss unions: too close a connection to the EU means more and more workers are being sent from other EU countries and ultimately results in wage dumping.
So far there is little to suggest that the new proposals will be met with enthusiasm by traditional critics of a treaty with the EU. The right-wing populist Swiss People’s Party (SVP) has already mentioned the government’s draft mandate “a poisoned Christmas package”, with which Switzerland would “submit to the EU”. It has announced that it will fight any form of institutional connection to the EU. And also Pierre-Yves Maillard, President of the Swiss Federation of Trade Unions, recently made a surprisingly clear statement about the draft mandate: “There is no chance that the unions will agree to the package presented by the Federal Council,” said Maillard in an interview.
The situation will probably remain the same for now, which made an agreement impossible last time: In Switzerland, a reorganization of the relationship with the EU is under attack from both the right and the left. In a direct democratic system this is no trivial matter. Because even if Swiss and EU negotiators reach an agreement this year, the negotiating package is likely to end up at the Swiss ballot box sooner or later. If the Left and the SVP, which has strong voters, continue to be against it, it will be difficult – again.