On March 8, the Swiss government confirmed that it would be reentering negotiations with the European Union. Here’s why Switzerland has to negotiate with the EU, why talks are only resuming now, and what the new agreement will look like.

Switzerland and the European Union

While Switzerland is not part of the European Union, the country is heavily integrated into the free movement of goods and people - hence why Swiss residence permits are much easier to apply for if the applicant is an EU or EEA citizen. The Swiss-EU relationship is defined by a large series of bilateral agreements relating to everything from agriculture to science to migration.

Since 2014, the two sides have been trying to improve, reform and combine some of the agreements into a single framework. This new set of accords was first submitted to the Swiss government in late 2018.

However, the Swiss Federal Council raised several issues with the deal, mainly the fact that it would give the European Court of Justice power over Swiss courts, lead to the scrapping of the state aid mechanism that helps maintain Swiss cantonal banks and could lead to salaries declining through having to impose EU labour laws and price controls. Sovereignty over energy, the stock exchange and the free movement of people were also concerns.

After trying and failing to reach a compromise, the Swiss government withdrew from talks in 2019. Negotiations were started officially again in 2021 but failed due to disagreements over the free movement of people and state aid rules.

Switzerland to restart EU negotiations in 2024

Now, speaking at a press conference, Foreign Minister Ignazio Cassis (FDP) confirmed that Switzerland would reenter negotiations with the European Union in 2024. When asked why they were trying again, Cassis said that the lack of an agreement puts “Swiss prosperity at risk.”

Cassis confirmed that the new Swiss plan was based on a “common understanding” with the EU, which was created after months of backroom talks. While no specific timeline was mentioned, he said that he and his EU counterparts wanted to “move forward quickly”, suggesting that official negotiations might begin at some point in March.

What does Switzerland want from the EU?

The Federal Council has set out several goals it wants to achieve with the EU. These are, among others:

• Electricity: Switzerland continues to subsidise and regulate the energy sector on its own.
• Transport: Switzerland is given full control over its public transport network and is allowed to choose which international rail services can pass through.
• Agriculture: Switzerland maintains full control over agricultural policy.
• Wage protection: Switzerland seeks an EU guarantee on salaries and working conditions.
• Price controls: While it is not against price controls, the government said it wanted an agreement that took "Swiss price levels" into account.
• Immigration: Immigration policies must be “labour market-oriented”, and the agreement must include a clause that exempts Switzerland from the free movement of people if immigration is deemed to be too high.
• Food protection: Switzerland must be able to keep its food health safety rules, which officials argue are much stricter than EU regulations.

Finally, the Federal Council said it hoped to maintain free trade between Switzerland and the EU, regardless of which deal is reached.

How do Swiss-EU negotiations in 2024 differ from last time?

The latest set of demands reflects a softening of the Swiss position, with 20 Minuten noting that the European Court of Justice’s involvement in Switzerland is no longer listed as a point of contention. Cassis himself confirmed that they are yet to lay out any red lines in negotiations.

Writing back in December 2023, EU President Ursula von der Leyen said “Switzerland and the EU are close friends and partners…Today's decision on a proposal for a negotiating mandate brings us another step closer to opening negotiations on our future relationship.”

However, there are still many hurdles to overcome, especially when it comes to sovereignty and the free movement of people. It is also unclear how willing the EU is to be more lenient in its negotiating positions.

Swiss-EU framework faces an uphill battle

What’s more, Cassis confirmed that even if they reach an agreement with the EU, the proposal will still have to pass both parliament and a referendum. The chief concern among critics is that the plan, as it stands, would mean that EU courts would have more sovereignty over Switzerland - which was one of the main sticking points when negotiations failed in 2018.

In a sign of what is to come, Marco Chiesa, outgoing president of the Swiss People’s Party (SVP) claimed in an editorial on March 10 that the Federal Council’s plan is a “subordination of Switzerland to the EU… [European Union] law takes precedence over national law… In case of doubt, EU judges and not the Swiss people have the last word.” 

The SVP is expected to be the main voice against the new plan, meaning Cassis is starting negotiations without the support of the largest party in the National Council. For more information about the negotiations, check out the official press release.