Documents considered by the Committee on 14th October 2015 - European Scrutiny Contents

21 EU and Kosovo: Stablisation and Association Agreement (SAA)

Committee's assessment Legally and politically important
Committee's decisionCleared from scrutiny
Document detailsProposal for Council Decisions on the conclusion and signing of a Stabilisation and Association Agreement between the EU and Kosovo
Legal base (a) Articles 217, 218(6)(a)(i) and 218(8) TFEU; unanimity (b) Article 101 Euratom; QMV (c) Articles 217, 218(5) and 218(8) TFEU; unanimity
DepartmentForeign and Commonwealth Office
Document Numbers(a) (36826), 8532/15 + ADDs 1-3, COM(15) 181

(b) (36827), 8534/15 + ADDs 1-3, COM(15) 182

(c) (36828), 8535/15 + ADDs 1-4, COM(15) 183

Summary and Committee's conclusions

21.1 These Decisions would enable the EU to sign and conclude (ratify) the Stabilisation and Association Agreement (SAA) with Kosovo, a process which the Government strongly supports. The political background is set out in more detail in our First Report.

21.2 However the process gives rise to legal difficulties relating to the application of the UK opt-in in respect of the elements of the Agreement falling within the subject matter of Title V of Part Three TFEU (concerning the Area of Freedom, Security and Justice)[ 117] and the exercise of competence. The difficulties in respect of competence are exacerbated by the fact that agreements of this sort are normally entered into by both the EU and the Member States each exercising separate competence. However in this case the SAA is being entered into only by the EU because five Member States do not recognise Kosovo. The Minister for Europe (Mr David Lidington) has written[ 118] to provide an update and to respond to the legal issues we raised.

21.3 We are grateful to the Minister for his response and update.

21.4 We now clear these documents from scrutiny, but in doing so draw the attention of the House to the fact that the signing and conclusion of this Agreement by the EU alone involves a concession that the EU should exercise shared competence.[ 119] This concession is justified, according to the Government, by the wider importance of this Agreement.

21.5 We have been unable to ascertain the precise extent of the concession because the Minister has not provided the further information we requested as to which provisions of the SAA are matters of shared competence. Although he has not been able to provide us with this information, he has been able to indicate that "we are content that this [exercise by the EU of shared competence] will not have an adverse impact on the positions of the EU and Member States on competence, nor any adverse impact on the nature of the scope of any similar agreements to be negotiated in the future".

21.6 To the extent that this assessment is based on his assertion that "In any event, the balance of competence is set out in the treaties and cannot be modified by a Third Country Agreement or a Council Decision" we disagree. As we have previously noted[ 120] the Treaties themselves provide that shared competence can be exercised by either the EU or the Member States. The extent to which the EU exercises shared competence is a policy choice. However, in this case we accept that the adverse effect is ameliorated by wording inserted into the proposed Decisions to indicate that this matter should not be regarded as a precedent; and by the addition of a legal base relevant to the Common Foreign and Security Policy reflecting this content in the Agreement.

21.7 On the issue of the opt-in, we repeat that we do not share the Government's view that the UK opt-in can apply to legislation which lacks a Title V legal base, such as these proposals. We note that the Government has pressed consistently for a Title V legal basis without success. A unilateral statement in the Council minutes is a poor substitute. The acknowledgements that the Agreement "contains provisions relating to JHA" does not appear to provide clarification that the UK opt-in applies.

21.8 On the assumption that the UK opt-in does, nevertheless, apply the Minister has now supplied, belatedly and after the opt-in had been exercised, the factors leading to the decision to opt in to the provisions on Mode IV services;[ 121] and the decision not to opt-in to the provisions on readmission. We do not pursue these matters further because we do not consider that the opt-in applies and, even if it did, the resultant lack of clarity is unlikely to give rise to practical difficulties for reasons outlined below.

Full details of the documents: (a) Proposal for a Council Decision on the conclusion of the Stabilisation and Association Agreement between the European Union and the European Atomic Energy Community and Kosovo: (36826), 8532/15 + ADDs 1-3, COM(15) 181; (b) Recommendation for a Council Decision approving the conclusion, on behalf of the European Atomic Energy Community, of the Stabilisation and Association Agreement between the European Union and the European Atomic Energy Community, and Kosovo: (36827), 8534/15 + ADDs 1-3, COM(15) 182; (c) Proposal for a Council Decision on the signing of the Stabilisation and Association Agreement between the European Union and the European Atomic Energy Community and Kosovo: (36828), 8535/15 + ADDs 1-4, COM(15) 183.

The exercise of competence


21.9 As is normally the case with agreements of this nature, this SAA covers matters where competence is shared between the EU and its Member States. When competence is shared it can be exercised either by the EU or by the Member States. This Committee, like its predecessor favours Member States exercising shared competence. However, in this case, such an approach is not possible as only the EU is entering into the SAA. For this reason we sought to ascertain from the Government the extent of shared competence and how the legal text would give expression to the assurances obtained by the Minister that this was a unique case.

The Minister's response

21.10 The Minister responds:

    "In response to the Committee's question on assurances that the Agreement is a unique case, that it does not change the current distribution of competence and that it does not set a precedent for future EU agreements, the amendments we have secured to the Council Decisions include wording which makes clear: 'the commitments and co-operation to be entered into by the Union under the Agreement relate only to the areas covered by the acquis or existing Union policies. Signature and conclusion of the Agreement as an EU-only Agreement is without prejudice to the nature and scope of any similar agreements to be negotiated in the future. It is also without prejudice to the powers of the EU institutions conferred on them in the Treaties and the positions of EU institutions and Member States on competences'. I judge that this provides sufficient assurance that the use of an EU-only agreement on this occasion will not set a precedent.

    "We have also secured citation of a CFSP legal base in the Council Decisions, to reflect the fact that there is clear CFSP content in the Agreement.

    "The Committee has also asked which elements of the Kosovo SAA fall within shared competence. Specifying where competence lies article-by-article risks negotiations in the Council becoming intractable and untimely. Some articles within this Agreement fall within shared competence, and the Union will be exercising this shared competence (given the agreement is EU-only). However, we are content that this will not have an adverse impact on the positions of the EU and Member States on competence, nor any adverse impact on the nature or scope of any similar agreements to be negotiated in the future. In any event, the balance of competence is set out in the treaties and cannot be modified by a Third Country Agreement or a Council Decision."

The UK opt-in


21.11 The Government asserts that the UK opt-in is engaged in respect of the provisions of the SAA concerning Mode IV services[ 122] and readmission.[ 123]

21.12 However, the EU institutions and other Member States do not accept that the UK opt-in is engaged unless the relevant proposals for EU legislation (in this case documents (a) and (c)) have a Title V legal base. This approach was supported by our predecessor Committee and we also agree.

21.13 On the basis of the Government's assertion that the UK opt-in was engaged the Committee asked the Minister for further information as to the factors affecting a decision whether or not to opt-in, in accordance with Government undertakings.[ 124] It also asked for further information as to the steps taken to resolve the apparent confusion between the SAA itself which touches upon the UK opt-in and the Decisions themselves, which do not recognise that the UK opt-in is engaged.

Minister's letter of 3 August 2015

21.14 In his latest letter the Minister for Europe (Mr David Lidington), indicates that the deadline for the UK to opt into the negotiation stage of the proposed Decisions (a) and (c) was 23 July 2015, and records that the UK was unsuccessful in securing Title V legal bases to these proposed Decisions. This would have signified acceptance by others that the UK opt-in was indeed engaged. In relation to the UK opt-in he further states:

    "The Government is committed to taking all opt-in decisions on a case-by-case basis, putting the national interest at the heart of the decision-making process. In making the opt-in decision on this proposal, the Government had particular regard to whether the provisions on Mode IV were in line with the UK's previously-agreed Mode IV commitments under the WTO General Agreement on Trade in Services (GATS).

    "On readmissions, the Government had particular regard to whether the UK wanted to be bound by an exercise of EU competence in relation to readmissions with Kosovo, which might limit the UK's ability to maintain its existing, effective readmission arrangements. We judged that the provisions in the SAA, or a future readmissions agreement, would not be an improvement on the effective readmission arrangements we already have with Kosovo, and that it was therefore not appropriate for us to opt in on this occasion.

    "In response to the Committee's comments about legal confusion and whether the Council Decisions are, on their face, inimical to the UK opt-in, I share the Committee's concerns. We have pressed consistently for a Title V legal base for these Decisions, to clarify that the UK's opt-in is engaged, but there has not been sufficient support in Council to secure one. However, we have secured an amendment to the Council Decision acknowledging that the Agreement contains provisions relating to JHA. We have also secured a recital in the SAA text itself clarifying that the opt-in would apply to JHA measures in any future agreements which could be made based on the Kosovo SAA. I judge that the political importance of the Kosovo SAA in addressing our wider foreign policy and security objectives means that we should not block adoption of the SAA over this matter.

    "When the Council Decisions are adopted, we will place on record our position by laying a minute statement. This minute statement will make clear the Government's view that the UK's JHA opt-in is triggered by the provisions in the Agreement on Mode IV and readmissions. It will also confirm that the UK has notified the President of the JHA Council of our decision to opt in on Mode IV."

Our analysis

21.15 It can be accepted by all parties that the UK is participating in these Decisions as regards Mode IV services, either because the opt-in is engaged and has been exercised (as the Government asserts) or because the UK is an automatic participant (as is the view of this Committee and the EU institutions).

21.16 However in relation to readmission the Government asserts that the opt-in applies and the UK has not exercised it, resulting in the UK's non-participation in the readmission arrangements of the Agreement. This would be a more serious discrepancy but for the fact that readmission procedures between the UK and Kosovo will be able to operate on the basis of the UK bilateral readmission arrangements. Therefore, a problem is only likely to arise in practice if the UK's bilateral readmission arrangements diverge significantly from those of the EU, enabling an individual adversely affected to exploit the situation. This is unlikely given that Article 88 of the Agreement only sets out the basic obligation to apply readmission and envisages a further agreement to cover the specific procedures. However the recitals to the Agreement make clear, as the Minister explains, that any such further agreement would be subject to the UK opt-in.

Previous Committee Reports

First Report HC 342-i (2015-16), chapter 27 (21 July 2015).

117   Protocol 21. Back

118   Letter of 3 August 2015. Back

119   Shared competence can be exercised either by the EU or the Member States, the choice is political. Back

120   First Report HC 342-i (2015-16), chapter 55 (21 July 2015), at para 55.7. Back

121   Mode IV services are involve the service provider crossing the border to provide the service and therefore overlap with immigration law. Back

122   These are service that involve the provider of the service crossing the border, and therefore overlaps with immigration law. Back

123   Reciprocal agreements to cooperate over the return of illegal residents to their country of origin or transit. Back

124   The statement made by the then Leader of the House of Lords (Baroness Ashton) on 9 June 2008, confirmed and expanded by the statement of the then and current Minister for Europe dated 20 January 2011. Back

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Prepared 14 October 2015