Scrutiny of international agreements; treaties considered on 9 September 2019 Contents

Scrutiny of international agreements: treaties considered on 9 September 2019

Chapter 1: Agreement drawn to the special attention of the House

UK-Swiss Agreement on Admission to the Labour Market for a Temporary Transitional Period following the withdrawal of the UK from the EU and the Free Movement of Persons Agreement [CP 152, 2019]1

1.The UK-Swiss Agreement on Admission to the Labour Market for a Temporary Transitional Period following the withdrawal of the UK from the EU and the Free Movement of Persons Agreement (‘the Agreement’) was laid on 18 July 2019; at the time of writing, given the likely prorogation of Parliament, it is unclear when the scrutiny period of 21 sitting days will end. It was considered by the EU Internal Market Sub-Committee on 5 September 2019.

Background

2.Relations between the EU and Switzerland are currently governed by over 100 bilateral agreements, including the EU-Swiss Free Movement of Persons Agreement (FMOPA), which relaxes restrictions on mobility between the Parties. The FMOPA is broad in scope, covering migration and residence rights, social security co-ordination (including reciprocal healthcare), economic rights and mutual recognition of professional qualifications.

3.The Agreement establishes temporary provisions for the access of UK workers (employed and self-employed persons) to the Swiss labour market, and vice versa. It will only come into force in a ‘no deal’ scenario: in the event that a Withdrawal Agreement is approved and ratified, the UK will continue to be treated as an EU Member State for the duration of any transition or implementation period. Although the Agreement is not based on the FMOPA, the Explanatory Memorandum (EM) states that it “recognises recent historical patterns” of labour mobility between the UK and Switzerland.2

UK workers moving to Switzerland

4.Swiss law requires foreign nationals to obtain a permit to take up employment or self-employment in Switzerland. The type of permit needed depends on several factors, for example the applicant’s nationality and the duration of their employment contract. Annual quotas are imposed on the number of ‘short-term’ permits for stays over four months and ‘residence’ permits that may be allocated to nationals of countries outside of the European Economic Area (EEA).

5.Article 4(1) of the Agreement provides for the Swiss Federal Council to determine a specific quota for UK workers who gain admission to the Swiss labour market for more than four months. In doing so, the Swiss government will consider the demand for UK workers in the Swiss labour market, but also the Agreement’s overarching objective to “preserve recent historical patterns of labour mobility” between the UK and Switzerland.3 The table below, provided by Department for Exiting the European Union (DExEU) officials, summarises UK work-related immigration to Switzerland between 2008 and 2018.

Table 1: UK migration to Switzerland for the purpose of work 2008–2018

Year

Total migration for work purposes (permanent and non-permanent resident population)

Short-term permits for work purposes (<=4 months)

Residence permits and short-term permits for work purposes (>4 months)

2008

5,481

1,210

4,271

2009

5,145

1,268

3,877

2010

6,220

1,472

4,748

2011

6,256

1,568

4,688

2012

5,466

1,520

3,946

2013

5,705

1,609

4,096

2014

5,217

1,564

3,653

2015

5,371

1,810

3,561

2016

5,133

2,079

3,054

2017

5,303

1,995

3,308

2018

5,437

2,080

3,357

Source: ZEMIS database; Swiss State Secretariat for Migration.

The figures in the right-hand column (residence permits and short-term work permits) are those that will become subject to quotas in the event of ‘no deal’.

6.On 13 February 2019, before the Agreement was concluded, the Swiss government announced that a quota of 3,500 permits will be made available to UK citizens in 2019 in the event of ‘no deal’. This consists of 2,100 residence permits and 1,400 short-term work permits (of more than four months).4 A decision on the 2020 quota is expected in the autumn. According to officials, the Swiss government has not yet confirmed if it intends to adjust pro rata the number of available permits to reflect the point in the year at which the UK leaves the EU.

7.The EM explains that, as part of the Agreement, Switzerland has also undertaken that UK workers applying for a permit will not need to meet the requirements on skill level, national preference and economic interest usually applied to non-EEA workers.5

Swiss workers moving to the UK

8.The EM explains that the Agreement requires the UK to treat Swiss workers at least as favourably as UK nationals will be treated in Switzerland. It also references a January 2019 policy statement setting out that, in the event of ‘no deal’, Swiss (and EEA) nationals relocating to the UK will be able, if they obtain ‘European Temporary Leave to Remain’,6 to live, work and study in the UK for three years. We note that the Government intends that EU, EEA and Swiss citizens will need to apply for an immigration status under a new system, which will come into effect from 1 January 2021, if they want to stay in the UK for more than three years.7

9.Article 5(2)(b) of the Agreement provides that the UK will not apply the “resident labour market test” to Swiss nationals coming to the UK for work. This test prevents employers from offering a job to certain categories of visa holders, unless that job has been advertised or is placed on a ‘shortage occupation list’.

Frontier workers

10.The EM states that the Agreement grants “additional protections” to frontier workers not covered by the UK-Swiss Citizens’ Rights Agreement,8 which only applies to UK and Swiss nationals who are frontier workers at the time the Agreement takes effect.9 DExEU officials clarified that the new Agreement will make it possible for UK and Swiss nationals to commence (or resume) frontier work after exit day.

Aspects of mobility not covered by the Agreement

11.The Agreement does not cover social security coordination between the UK and Switzerland.10 DExEU officials explained that the Government is seeking a bilateral agreement with Switzerland to maintain the current social security coordination framework (including reciprocal healthcare) until December 2020 in a ‘no deal’ scenario. It is not clear if such arrangements will be in place by 31 October 2019.

12.The Agreement does not contain any measures for UK or Swiss nationals moving to the other Party’s jurisdiction as jobseekers. Under the FMOPA, EU (including UK) citizens may remain in Switzerland for up to 15 months while looking for employment, provided that (after an initial period of three months) they obtain permission from the Swiss authorities. Officials told us that, in the event of ‘no deal’, UK nationals travelling to Switzerland will become subject to short-stay rules for third country nationals, which allow for a maximum stay of 90 days per 180-day period. They will need to have a job offer in order to be eligible to apply for a longer-term residence status. When asked about arrangements for Swiss jobseekers coming to the UK after Brexit, officials said that further details on the Government’s plans for a new immigration system are being developed and will be set out shortly.

13.Lastly, the Agreement does not cover the temporary provision of services on a cross-border basis.11 We note that the Citizens’ Rights Agreement ensures that in a ‘no deal’ scenario the EU-Swiss 90-day rule will continue to apply for five years for contracts that started before exit day, but it makes no provision for contracts commencing thereafter. We noted in our report Scrutiny of international agreements: treaties considered on 12 March 2019 that trade in services accounts for a sizeable share (52%) of overall trade between the UK and Switzerland.12

Entry into force, governance arrangements and territorial application

14.The Parties have agreed that, if domestic ratification procedures are not completed by exit day, the Agreement will be applied provisionally. As with the FMOPA, the Agreement will extend to Gibraltar. The EM states that any other territory or Crown Dependency may request that the Agreement be extended to them.

15.Article 11 of the Agreement establishes a Joint Committee, made up of representatives of both Parties, that will administer the Agreement and settle any related disputes. The Joint Committee will also be responsible for deciding if the Agreement should be extended beyond its current termination date of 31 December 2020, subject to approval by the governments of both Parties. This decision will not be subject to further parliamentary scrutiny under the CRAG Act. The Agreement is otherwise non-amendable.

Consultation

16.The EM indicates that the Government has engaged with the devolved administrations and government of Gibraltar, including by sharing the draft text of the Agreement. Officials told us that no responses had been provided. Officials also told us that consultation with other stakeholders was not deemed necessary, because the Agreement “provides some replication” of the effect of a transition period under the terms of the draft Withdrawal Agreement.

Conclusions

17.The Agreement would, for a time-limited period, exempt UK and Swiss workers from complying with the full range of requirements for access by third country nationals to the Parties’ labour markets. At the same time, it is not a comprehensive arrangement and does not cover areas such as social security coordination or facilitations for jobseekers. We note that the lack of provision in these areas may have an adverse impact on labour mobility between the UK and Switzerland.

18.As we noted in our report Scrutiny of international agreements: treaties considered on 19 March 2019, the patchwork nature of the agreements negotiated with the Swiss Government makes scrutiny particularly difficult.13 Without comprehensive explanatory material linking related agreements, it is difficult to build a clear overall picture of UK-Swiss arrangements in a ‘no deal’ scenario.

19.We draw special attention to the UK-Swiss Agreement on Admission to the Labour Market for a Temporary Transitional Period following the withdrawal of the UK from the EU and the Free Movement of Persons Agreement, on the grounds that:


1 Agreement between the United Kingdom of Great Britain and Northern Ireland and the Swiss Confederation on Admission to the Labour Market for a Temporary Transitional Period following the withdrawal of the United Kingdom from the European Union and the Free Movement of Persons Agreement, CP 152, 2019: https://www.gov.uk/government/publications/ukswitzerland-agreement-on-admission-to-the-labour-market-for-a-temporary-transitional-period-following-the-withdrawal-of-the-uk-from-the-eu-and-the [accessed 6 September 2019]

2 The UK and Switzerland have concluded a separate agreement to transition the FMOPA—the Citizens’ Rights Agreement. This is intended to protect the right of stay of UK nationals already living in Switzerland, and Swiss nationals in the UK, at the time the Agreement takes effect (the ‘specified date’). It will also provide for a gradual phase-out of some of the rights afforded by the FMOPA. In March we drew the Citizens’ Rights Agreement to the special attention of the House: see European Union Committee, Scrutiny of international agreements: treaties considered on 19 March 2019 (34th Report, Session 2017–19, HL Paper 321).

3 Article 1(b) of the Agreement.

4 Swiss Confederation, ‘Quotas for UK citizens in the event of a disorderly withdrawal from the EU’, 13 February 2019: https://www.admin.ch/gov/en/start/documentation/media-releases.msg-id-73962.html [accessed 19 August 2019]

5 To be admitted to the Swiss labour market, non-EEA nationals must fulfil the following criteria: (1) their admission must be in the interests of Switzerland and the Swiss economy as a whole; (2) they must be managers, specialists or other qualified workers; and (3) Employers must prove that, despite their best efforts, no suitable Swiss worker could be recruited.

6 HM Government, ‘Staying in the UK for longer than 3 months if there’s no Brexit deal’, 28 January 2019: https://www.gov.uk/guidance/european-temporary-leave-to-remain-in-the-uk#contents [accessed 23 August 2019]

7 HM Government, ‘Moving to the UK after Brexit: EU citizens and their families’, 28 January 2019: https://www.gov.uk/guidance/european-temporary-leave-to-remain-in-the-uk [accessed 5 September 2019]

8 Agreement between the United Kingdom of Great Britain and Northern Ireland and the Swiss Confederation on citizens’ rights following the withdrawal of the United Kingdom from the European Union and the Free Movement of Persons Agreement, CP 64, 2019: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/782490/CS_Swiss_5.2019_Citizens.pdf [accessed 6 September 2019]. For more detail on the UK-Swiss Citizens’ Rights Agreement, see European Union Committee, Scrutiny of international agreements: treaties considered on 19 March 2019 (34th Report, Session 2017–19, HL Paper 321)

9 Frontier workers (also referred to as ‘cross-border commuters’) are persons who work in one country but live in another and return there daily, or at least once a week.

10 The Citizens’ Rights Agreement protects the social security rights of workers already in the UK or Switzerland when the Agreement takes effect (the ‘specified date’). It also safeguards the rights of UK nationals who, although not living in Switzerland at the specified date, paid social security contributions in Switzerland in the past.

11 The rule allows EU professionals to provide services in Switzerland (and vice versa) for up to 90 days in a calendar year.

12 European Union Committee, Scrutiny of international agreements: treaties considered on 12 March 2019 (33rd Report, Session 2017–19, HL Paper 315)

13 European Union Committee, Scrutiny of international agreements: treaties considered on 19 March 2019 (34th Report, Session 2017–19, HL Paper 321)




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