Switzerland–EU: Further development of relations at eye level

While we Swiss are dealing with a shockwave of greater proportions – the surrender of our neutrality as well as the sacrificial interference with our financial centre on the altar of US-UK interests – the Federal Council is already seizing the next opportunity to satisfy foreign powers.

On 29 March, the Federal Council instructed the Federal Administration to “draw up key parameters for a negotiating mandate with the European Union (EU)”.¹ What can that sudden rush be all about? Just because the EU Commission is pushing and threatening? It has been doing so for years. If you wash away the foam, the new variant has more or less the same content as the “institutional framework agreement” with Brussels the negotiations for which the Federal Council broke off in May 2021 – for good reasons. The “Conference of Cantonal Governments (CdC)” supports the new variant. But there are also weighty opposing voices with strong arguments.

Horizontal or vertical?
From Brussels everything comes vertically, from above

Translated into somewhat comprehensible German, the following contents of the Federal Council´s media release remain: The 2021 Framework Agreement would have packaged the EU rules into a single “horizontal” (framework) agreement that would have applied to all (previous or future) agreements.
  The “vertical solution” propagated today by the Federal Council would consist of the existing bilateral (market access) agreements and, for good measure, a “whole package with new concrete agreements (including electricity, food safety and health)”. So, apropos of nothing, the Federal Council wants to smuggle three new agreements into its “package” ...
  In addition to the rules that apply to all, corresponding special rules are to be included in the individual agreements. For example, the Agreement on the Free Movement of Persons would additionally regulate wage protection or the limits of social assistance for new immigrants.
  At best, this distinction confuses people’s minds, because the whole system is and remains vertical, it is namely imposed by Brussels and incompatible with the Swiss state system. On the subject of wage protection: we might be allowed to carry out a few percent more checks on construction sites than EU countries, but that is no substitute for effective Swiss wage protection measures – are the trade unions to be fobbed off in this way?
  We have no reason to show signs of weakness towards the EU. In fact, we have a lot to offer our neighbours: Free movement of persons, transit traffic and power lines through the Alps, a domestic market with strong purchasing power (more imports than exports in Switzerland compared to the EU), reliability as a trading partner.

CdC ready for new negotiations
with the EU – with reservations

On 24 March 2023, the “Conference of Cantonal Governments CdC” published a media release entitled “The cantons support new negotiations with the EU”. According to this, the cantonal governments have “unanimously” agreed to a “new standpoint determination concerning European policy”. The CdC is an imitation of the EU ministerial conferences and has replaced the cooperation of the cantons in our once strong federalist system with its rough edges by a central office in Bern – without us citizens having legitimised these arrangements adopted by our cantonal governments. And are they (the cantonal governments) truly all supposed to agree on such a momentous matter?
  The CdC expresses itself as follows in its position paper²:

• Legal certainty: The CdC hopes that a new treaty will lead to “a long-term and stable relationship” with the EU instead of the “creeping erosion of the bilateral agreements”. Note: The “creeping erosion” is not due to Switzerland – we have always complied with the treaties – it is a consequence of the treaty-breaking harassment used by the Brussels bureaucracy to wear us down. Would a new “package” give us more legal security than the previous bilateral agreements? The contracting party remains the same …
• Adoption of EU law: The CdC is prepared to “agree to a dynamic adoption of law”, subject to the “approval of the Federal Council, Parliament and the people”. Note: We have already gained experience with this kind of reservation, for example after the acceptance of the federal popular initiative “Against Mass Immigration” by our sovereign. Its text has been laid down in the Federal Constitution for nine years (Art. 121a) and stipulates: “Switzerland shall manage the immigration of foreigners independently”, with maximum numbers and quotas. Yet in implementing this constitutional provision, the Federal Council and the parliamentary majority joined forces with EU bodies against their own people and passed an anaemic law that reflects the will of the citizens in no way.
• Dispute resolution: The CdC favours “a treaty-based mechanism for the settlement of disputes” and “accepts” that the ECJ should “ensure a coherent interpretation” of EU law adopted by Switzerland. Note: With these two sentences, the central office of our 26 cantonal governments subordinates itself to the counterparty’s court.
• Monitoring: Here the CdC does show a mind of its own: “The cantonal governments continue to reject supranational monitoring of the application of the agreements with the EU. The correct application and implementation of the agreements is the responsibility of the two contracting parties in their respective territories.” Note: They are right! The planned agreement would also affect the cantons and put their very own tasks in the federal state “on the line”. Only: The EU Commission will never, ever relinquish control to the cantons (see next paragraph).
• Ban on state aid: The Federal Council prefers to omit this point, also in its media release of 29 March. The fact is that in the case of the public service, which is deeply rooted in the people, no stone would be left standing if we accepted the EU ban on state aid. An electricity agreement, for example, is in fact not possible as long as the Swiss hydroelectric power plants are largely owned by the cantons and municipalities and the population rejects privatisation. The CdC leadership is well aware of this, but believes “that in the case of market access agreements with the EU, there is no way around adopting the EU’s state aid rules [...]”. In this dilemma, it dithers about what to do and finally demands, rather unrealistically, that state aid regulations “on the one hand will not significantly encroach on the competences of the cantons and that on the other hand already existing state aid should, as far as possible, fall under exemption regulations […]”.

The German “Federal Ministry for Economic Affairs and Climate Action” dampens such hopes: “The member states have decided that state aid control is the exclusive competence of the European Commission (‘guardian of the EU treaties´) [...] Therefore, all planned state aid-relevant measures must be notified or even formally notified to and approved by the European Commission.”³
  The direct-democratic and federalist Swiss state model is simply not compatible with the EU. The following letter to the Federal Council makes this crystal clear.

Kompass/Europa to the Federal Council:
Swiss-style constructive criticism

Kompass/Europa is a broad, non-partisan alliance of entrepreneurs, politicians and many other citizens, which already helped the Federal Council to stop negotiations with Brussels on the Framework Agreement in May 2021. On 23 March, Kompass/Europa wrote an “Open Letter to the Federal Council”.⁴
  The authors call on the Federal Council to “only give a negotiating mandate that respects the interests of the Swiss people and economy”. They point to the fact that they had always supported the bilateral path and were open to a selective adoption of law in individual areas, “with a fundamental dynamic adoption of law, however, we risk that in case of doubt our laws will no longer be dictated by parliament and the electorate, but by the EU. We must not give this our direct-democratic legislative competence out of our hands.” Like many other voices, Kompass/Europa also states that the ECJ as a court of the opposing party is not suitable for settling disputes; rather, “a neutral, clarifying instance is needed. This is one of the things we miss in the current discussion.”
  The Alliance recommends the Federal Council “not to continue the negotiations on the current basis”, if the EU does not back down from its conditions, because “we value our grassroots democratic rights and our long-term locational advantages more highly than short-term transaction cost advantages from a possible treaty package with the EU. Last but not least, we are convinced that you need to be persistent vis-à-vis the EU in order to obtain the necessary domestic political support for Switzerland’s future European policy.”
  The letter to the Federal Council concludes with the supportive words: “For the complex and demanding decisions you have to make, we would like to wish you serenity and express our confidence. Good solutions or even new approaches need time. We have that.”  •

¹ “Bundesrat beschliesst das weitere Vorgehen im Hinblick auf ein Verhandlungsmandat” (Federal Council decides on further procedure with a view to a negotiating mandate). Media release of 29 March 2023
² Conference of Cantonal Governments KdK. Beziehungen Schweiz-EU. Standortbestimmung der Kantone (Switzerland-EU relations. Status Report of the Cantons) of 24 March 2023
³ https://www.bmwk.de/Redaktion/DE/Artikel/Europa/beihilfenkontrollpolitik.html
⁴ https://kompasseuropa.ch/wp-content/uploads/2023/03/Offener-Brief-an-den-Bundesrat-1.pdf