Twenty-fifth Report of Session 2013-14 - European Scrutiny Committee Contents


9 Croatia's accession to the EU/Switzerland Agreement on the Free Movement of Persons

(a)

(35455)

14367/13

COM(13) 674


(b)

(35460)

14368/13

COM(13) 673


Draft Council Decision on the signing of a Protocol to the Agreement between the European Community and its Member States, and the Swiss Confederation, on the free movement of persons, to take account of the accession of the Republic of Croatia to the European Union

Draft Council Decision on the conclusion of a Protocol to the Agreement between the European Community and its Member States, and the Swiss Confederation, on the free movement of persons, to take account of the accession of the Republic of Croatia to the European Union

Legal base(a)  Articles 217, 218(5) and 218(8) TFEU; unanimity

(b)  Articles 217, 218(6)(a) and 218(8) TFEU; unanimity; EP consent

Documents originated(Both) 1 October 2013
Deposited in Parliament(a)  3 October 2013

(b)  4 October 2013

DepartmentHome Office
Basis of considerationEM of 18 November 2013
Previous Committee ReportNone
Discussion in CouncilAgreement expected in December
Committee's assessmentLegally important
Committee's decisionNot cleared; further information requested

Background

9.1 In June 1999, the (then) European Community and its Member States signed an Agreement with Switzerland on the free movement of persons to enable EU and Swiss nationals to live and work in each others' territories (the Agreement). The Agreement entered into force on 1 June 2002. Croatia acceded to the European Union on 1 July 2013. Under the terms of its Accession Treaty, Croatia undertakes to accede to agreements concluded by the EU and Member States with third countries. In September 2012, the Council authorised the Commission to open negotiations with Switzerland with a view to concluding a Protocol providing for Croatia's accession to the Agreement. The Protocol resulting from these negotiations is annexed to the draft Council Decisions deposited for scrutiny.

The draft Council Decisions

9.2 Document (a) authorises signature of the Protocol and document (b) its conclusion on behalf of the EU and its Member States. Both draft Decisions cite Articles 217 and 218 of the Treaty on the Functioning of the European Union (TFEU) as their substantive legal bases. Article 217 TFEU empowers the EU to conclude association agreements with third countries "involving reciprocal rights and obligations, common action and special procedure." Article 218 TFEU provides for decisions on the signing and conclusion of such agreements (including, in this case, any Protocol to such agreements) to be agreed by the Council by unanimity. The European Parliament is also required to give its consent.

9.3 Once the Protocol has been approved, Croatia will become a Contracting Party to the Agreement, subject to transitional provisions which are set out in the body of the Protocol.

The Government's view

9.4 The Minister for Immigration (Mr Mark Harper) describes the Protocol as a "technical measure resulting from Croatian accession, which has no impact on the UK",[17] adding:

"In practice, the proposal has the effect of updating the existing Association Agreement to include Croatia to reflect its accession to the EU. The amendment does not seek to amend the terms of the agreement beyond this, and will affect movement between Croatia and Switzerland. The free movement provisions for both Swiss and Croatian nationals in the UK will not be affected by this amendment."[18]

9.5 The Minister does, however, dispute the legal bases proposed by the Commission for both draft Decisions:

"The extension of the EU-Switzerland Agreement to Croatia will allow nationals of a third country, Switzerland, to reside in the territory of a Member State, Croatia. Accordingly, it is our view that the EU will be exercising competence under Article 79(2)(b) TFEU.[19] For that reason, we consider the proposal to engage the UK's opt-in under Protocol 21 to the Treaties. We will proceed to take an opt-in decision on this basis. We will seek the citation of an Article 79(2)(b) TFEU legal base but assess that it is unlikely we will be successful in this regard due to the views of the Commission and other Member States."[20]

9.6 The Minister alludes to an earlier draft Council Decision amending the social security provisions of the same Agreement which we last considered in February 2012 and which remains under scrutiny.[21] In that case, the Commission proposed Article 48 TFEU (on social security coordination) as the substantive legal base for the draft Decision. As the amendments to the Agreement would have the effect of extending social security rights for Swiss migrants to the UK, the Government considered that Article 79(2)(b) TFEU should be cited instead, as this provision concerns the definition of the rights of legally resident third country nationals. Article 79 TFEU (unlike Article 48) is subject to the UK's Title V (justice and home affairs) opt-in. Despite the UK's objections, the draft Council Decision was adopted on an Article 48 TFEU legal base and the Government initiated proceedings to challenge its validity in the Court of Justice. Pending the Court's ruling on validity, and on the application of the UK's opt-in to EU measures which do not cite a Title V legal base, the draft Decision remains under scrutiny.

9.7 The Minister suggests that "similar principles are at stake" with regard to the draft Council Decisions providing for Croatia's accession to the Agreement. He continues:

"If we are unsuccessful in attaining the citation of an Article 79(2)(b) legal base in respect of the current proposal and if the Government were to decide not to opt in we would need to consider whether to launch another ECJ challenge.

"The Government will now consider whether to opt in to the proposal and must communicate this decision to the EU Council Secretariat by early December in order to allow the measures to apply from 1 January 2014."[22]

9.8 In the section of his Explanatory Memorandum dealing with the financial implications of the draft Decisions, the Minister states:

"The proposed amendment does not present any financial implications, as there will be no legal challenge to the proposal from the UK and the right of free movement will not be extended to persons to whom it does not already apply."[23]

9.9 Turning to the timetable for reaching agreement in Council, he adds:

"The agreement puts in place measures starting from 1 January 2014. Therefore the EU must agree its position in time for the EEAS and Switzerland to arrange signature before the end of the year. The last Council that could agree the point takes place on 17 December. Therefore approval is sought before the preparatory Coreper scheduled for 12 December."[24]

Conclusion

9.10 We note that the Government accepts that there is little prospect of securing a change to the legal base for the draft Council Decisions, but nevertheless intends to "take an opt-in decision" on the strength of its conviction that Article 79(2)(b) TFEU is the correct legal base. We do not accept that the UK's Title V (justice and home affairs) opt-in applies in the absence of a Title V legal base. Moreover, it is clear from the timetable set out in the Minister's Explanatory Memorandum that other Member States have no intention of applying the procedural requirements set out in the UK's Title V opt-in Protocol (including the three-month opt-in period) before reaching a decision.

9.11 We note that a unanimous decision of the Council is required to adopt the draft Decisions. The Government therefore has the power to veto the draft Decisions if it is unable to persuade other Member States to amend the legal base, or to abstain and challenge their validity post-adoption in the Court of Justice. We ask the Minister to clarify which course of action the Government intends to take and to explain the apparent contradiction in his Explanatory Memorandum which states (in paragraph 18) that the Government will "need to consider whether to launch another ECJ challenge" and (in paragraph 23) that "there will be no legal challenge to the proposal from the UK."

9.12 We note also that two earlier Protocols extending the EU/Switzerland Agreement to central and eastern European countries acceding to the EU in 2004 and 2007 were based on Treaty provisions equivalent to those cited in the current draft Decisions.[25] We ask the Minister to explain why he considers that a different legal base is justified for the latest Protocol on Croatian accession. Pending further information from the Minister, the draft Decisions remain under scrutiny.



17   See para 20 of the Minister's Explanatory Memorandum.  Back

18   See para 14 of the Minister's Explanatory Memorandum. Back

19   Article 79(2)(b) TFEU provides for the adoption of measures on "the definition of the rights of third country nationals residing legally in a Member State, including the conditions governing freedom of movement and of residence in other Member States." Back

20   See para 9(i) of the Minister's Explanatory Memorandum. Back

21   See Council document 16231/11 (33298); HC 428-xliv (2010-12), chapter 7 (14 December 2011) and HC 428-xlix (2010-12), chapter 6 (1 February 2012).  Back

22   See paras 18 and 19 of the Minister's Explanatory Memorandum. Back

23   See para 23 of the Minister's Explanatory Memorandum. Back

24   See para 28 of the Minister's Explanatory Memorandum. Back

25   The relevant provisions are Articles 300(2) and (3) and 310 of the EC Treaty.  Back


 
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