The ‘institutional issues’

Welcome to the fifth week of our course! Last week, we studied the free movement of persons, and we did so against the background of discussions and attempts to limit migration in Switzerland. We saw how this is causing tensions with Switzerland’s obligations, notably, under the Agreement on the Free Movement of Persons that Switzerland concluded with the EU. This week, we turn to another difficult matter in the relationship between the EU and Switzerland, namely, the functioning of the bilateral agreements, or their institutional framework.

As a starting point, we will use the so-called 8-days rule under Swiss law in order to explain the difference between the substantive content of an agreement, on the one hand and, its functioning or the institutional side, on the other hand. The 8-days rule concerns the free movement of services. This freedom is guaranteed for service providers under the Swiss-EU Agreement on the Free Movement of Persons. However, Annex 1 to that agreement contains important reservations. First, Art. 22(2) reserves national laws, regulations, and administrative practices for the application of working and employment conditions to employed persons posted for the purpose of providing a service and in this context makes reference to the EU’s posted workers legislation. Second, Art.

22(4) reserves national laws, regulations, and administrative practices necessitated by imperative requirements in the public interest. Against this background, Switzerland has adopted a number of supporting measures. Some of these measures have led to discussions in the Joint Committee in charge of the Agreement on the free movement of persons. This includes, in particular, an eight days notification requirement for undertakings from the EU wishing to provide services in Switzerland, which appears to be particularly burdensome for small and medium enterprises. The basis for the rule is Art. 6 of the Swiss Act on the posting of workers.

According to this article, the company planning to bring workers to Switzerland must submit certain information to the Swiss authorities, including, in particular, the identity of the workers, their salary, the work, and the place where the work will be carried out. Art. 6(3) then states, ‘The work may start eight days after submitting the information at the earliest.’ This is the 8-days rule. As there is no corresponding obligation for Swiss companies, this rule appears to amount to discrimination on the grounds of nationality against service providers from the EU. The EU and Switzerland disagree on the question of whether the requirement is nevertheless allowed under the provisions of Annex I of the Agreement on the free movement of persons.

According to Switzerland, it is fine, since it serves the protection of workers. However, according to the EU, the rule breaches the Agreement. Note that the question of whether or not the Swiss 8-days rule is in line with the Agreement is a question of substance. That is, a question of what free movement means in the present context. Conversely, the question of how to decide on a contested matter, such as the legality of the 8-days rule, is an institutional matter. Why, then, are the institutional aspects of the sectoral or bilateral law a “difficult issue” between Switzerland and the EU? For that, the 8-days rule is an illustrative example. This particular dispute has been going on for several years.

The reason for this lengthy duration is that the Free Movement of Persons Agreement does not provide for a mechanism of independent international supervision of the functioning of the Agreement or for the settlement of the dispute between the parties to the agreement through judicial means. In the eyes of the EU, such mechanisms should exist. Other institutional issues that the Union considers important relate to the development of the content of the various agreements in order to update them in line with the EU law from which they are derived and to rules on the interpretation of the agreements in parallel with EU law. In our fifth course week, we will focus on these institutional issues.

We will first learn about the present institutional rules. Thereafter, we will turn to the Unions’ demands in this respect as seen against a background of the Unions’ models to deal with such demands. These models include, in particular, EEA law. We will then look at the Swiss-EU negotiations on the institutional issues and at what so far has been achieved in this context. A peer review test will round off our work in this course week. Once again, we look forward to working with you in this course week!