The bilateral approach remains the best instrument of European policy Switzerland has at its disposal to defend its interests with respect to the EU, which continues to be Switzerland's most important trading partner by far. Based on a matrix of around 20 or so main bilateral agreements and about 100 other sectoral agreements, it ensures access for Swiss business to the single European market. On a number of occasions the Federal Council has reaffirmed the validity of this approach as best suited to defending Switzerland's interests. The bilateral approach has also regularly enjoyed the support of the Swiss electorate and the cantons, often winning a majority in referendums.

In order to preserve what Switzerland has gained, the bilateral approach must be renewed, taking care to safeguard Swiss independence and prosperity, as well as ensuring access to the market. Discussions at the national level and with our European partners have enabled this country to outline a number of technical and legal solutions. Based on one of those options, in June last year the Federal Council instructed the FDFA to draw up draft terms of reference for negotiations. Today the Federal Council confirmed its decision from last June and is submitting the draft terms of reference to the Foreign Affairs Committees and the cantons. The social partners are being informed.

Institutional issues
The solution chosen by the Federal Council does not entail setting up any new supranational institution. It ensures the homogeneity of applicable law while preserving Switzerland's autonomy as a non-EU Member State. Each party will monitor implementation of the agreement by its authorities on its own territory, while the joint committee will provide general supervision of the agreement's implementation. Questions of interpreting EU law cited in a bilateral agreement may if required be brought before the Court of Justice of the European Union, either by Switzerland or the EU. Based on the Court’s interpretation, it would then be up to the joint committee to find a mutually acceptable solution. If none can be found, proportionate compensatory measures might be taken, up to and including the suspension of all or part of the agreement concerned.

Likewise, the solution chosen does not entail automatic adoption of the acquis communautaire. Incorporation of any new acquis in a bilateral agreement must be decided by Switzerland in full accordance with its domestic procedures. Finally, any future institutional agreement may not alter the nature or scope of existing agreements between Switzerland and the EU. Thus, for example, as regards the agreement on the free movement of persons, there would be no adoption of the EU's citizenship directive. It is ensured that Switzerland can maintain the accompanying measures within the framework of the free movement of persons.

Next steps
The draft terms of reference – which contain the objectives and directives for negotiations to which the Swiss delegation must adhere – have been submitted for consultation to the Foreign Affairs Committees and the cantons. The social partners are being informed. The results of the consultation will be submitted to the Federal Council for the adoption of definitive terms of reference. If negotiations go ahead and are successful, Parliament and the Swiss people will have an opportunity to express their views.

Europe: Federal Council submits draft institutional terms of reference for consultation