EU-Swiss ties and treatment, lesson for UK

The ongoing tiff between European Union and Switzerland can been seen as a warning call for Britain, to take away the key lessons on how the cross-border ties between London and Brussels would operate in the post-Brexit regime. If UK withdraws out of the 27-nation bloc without a deal, it would clearly endanger the future collaborations between the two. As in the case of Swiss-EU impasse over the cross-border trading, what worsened the things for Bern was the lack of assurance, leading to decreased collaboration with EU nations and worst being blocked out of major EU-backed research projects.

In 2014, when Switzerland imposed stricter migration laws, post its referendum, basically to prevent the ‘free movement’ and inflow of low-skilled migrants into Switzerland. That sent the nation into isolation and regression for over five years.

The key reason of the ongoing standoff between Bern and Brussels was that EU wanted to incorporate about 120 bilateral treaties in the name of ‘institutional framework’, which would require Switzerland to automatically follow some EU laws, a proposal which Bern rejects. Also, Switzerland, a non-EU nation was asked to follow EU single market rules.

Like Switzerland, the UK would also have to pursue a similar “equivalence” relationship, post-Brexit, with the EU based on two parallel regulatory systems.

Jos Dijsselhof, CEO of SIX Group, which controls the SIX Swiss Stock Exchange, told CNBC on Thursday that the EU’s approach towards resolving bilateral ties with Switzerland indicated that the bloc was getting more stern with third party countries.

Dijsselhof said “Switzerland is technically equivalent, the EU has just used this as a political means to hold the Swiss hostage to talk about the overall framework agreement.”

You do see that the stance of the EU against third party countries is hardening more and more, and we in Switzerland have seen that, and you see that also in the EU-U.K. discussion also, so it is an example of how hard it can be.”

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