The legal obstacles to the revision of the EU-Switzerland bilateral agreement on free movement of persons: the impracticability of Swiss requests from the Union’s point of view

T

EU-S

PERSONS

:

S

THE

U

’

Master’s thesis in International and European Law:

Public International Law

Supervisor: Prof. Steven Blockmans

This dissertation considers whether Switzerland is violating or will violate the provisions of the EU-CH Agreement on the free movement of persons. In order to do so, it analyzes two popular initiatives of constitutional amendment: one at the federal level, the other at the cantonal level. Moreover, it discusses whether General Principles of EU Law are an impediment to the renegotiation of the agreement. The analysis suggests that there is no breach at the moment, mainly because of the governments’ (at both levels) unwillingness to commit violations. Yet, especially in the Canton of Ticino, the pressure to move in that direction is strong, despite the ineffectiveness of the proposed norms. There is a significant number of considerations indicating the intention to export on the one hand, and to accept, on the other, the Area of Freedom, Security and Justice to Switzerland. The wording of the agreement replicates that of EU Law, even though jurisprudence is keen on affirming that the

acquis communautaire applies to Switzerland with some limitations. However, some

principles – such as non-discrimination – enjoy a very extensive interpretation and are believed to be non-negotiable.

I

In recent years, two popular initiatives to amend the federal Constitution and one cantonal Constitution in Switzerland have been voted. Their application will affect EU-Swiss relations severely, because their content clashes with a EU Law General Principle, namely the freedom of movement of person, subject over the which Switzerland has an agreement with the Union. This dissertation will focus on two specific legal provisions enacted or to be enacted by Switzerland. The assumption that the application of EU Law rules is the primary source of inspiration for the ratification of EU-CH bilateral agreements is my starting point. I submit, more specifically, that the effect of the ratification of the EU-CH Agreement on Free Movement of Persons is the exportation of the EU Area of Freedom, Security and Justice to non-EU territory, whose geographical position is crucial to the Union. This effect is testified by both the bilateral agreement and the repercussions its content has on Swiss Law, effectively placing it on a lower rank than EU Law. With this agreement, Switzerland consented to submit itself to EU-decided standards. In this view, the two popular initiatives I intend to analyze represent two different acti contrarii to that manifestation of consent. Even though the present agreement includes the possibility to limit EU immigration in Switzerland in certain cases and for a limited period of time, there will probably come a time when Swiss Law will clash with the provisions of the agreement, if those (or eventually Swiss Law) are not changed. The agreement is already being renegotiated, but the negotiations have come to a sort of a deadlock. The problem is, Switzerland wants to apply standards more restrictive than

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] those European, but – since the Treaty of Lisbon – the acquis and the Area of Freedom, Security and Justice are non-negotiable EU standards and it will be very difficult for Switzerland to obtain such a legal regime in a reviewed bilateral agreement. Moreover, the standstill clause applied to the present agreements makes this possibility even more remote. The aim of my dissertation is to answer the question whether Switzerland is already violating the Agreement on free movement of persons with the Union at the moment or otherwise is on the path thereto, due the application of these popular initiatives. If so, I will describe how Switzerland is violating or is going to violate the agreements, assuming they will not be modified. Consequently, I will address the question to what extent are EU Law standards applicable in Switzerland, with regard to the agreement in question.

In the first Part of this paper, I will describe the functioning of the present Agreement on Free Movement of Persons between Switzerland and the European Union, with particular regard to the consensual safeguard clause, which temporarily limits immigration of EU citizens into Switzerland and the powers of the Joint Committee, which is designed to deal with legal controversies.

In Part II, I will describe General Principles of EU Law, upholding their insertion in the bilateral agreement represents the legal basis and the opinio juris to broaden the application of EU Law standards outside its territory.

In Part III, I will analyze the federal popular initiative “Against Mass Immigration” and its relation with EU Law. I submit that its application is not breaching any provisions of the bilateral agreement at the moment simply because of Switzerland’s conduct, which – acting on the edge of the Law – holds its position on the borderline. Furthermore, I argue that the threat of enacting a unilateral safeguard clause (posed by Switzerland, in case no agreement is found on the renegotiation of the present agreement) is a way to violate several provisions of the agreement.

The same I will do in Part IV, where I analyze the cantonal popular initiative “We Go First!”, aimed at giving precedence to Swiss workers rather than EU citizens working in Switzerland. I argue it will be difficult for the Canton of Ticino to give application to that popular mandate, whereas it must find a place in the wider puzzle comprised of EU Law principles, the Agreement on Free Movement of Persons and Swiss federal legislation. I will also argue that, whereas the envisaged application of some constitutional provisions may not achieve the objectives foreseen by the legislator, the legality of such provisions becomes disputable as the ratio legis clashes with the effects caused by the provisions themselves.

T

On 21 June 1999, the then European Community and the Swiss Confederation signed the Agreement on the Free Movement of Persons1, as a part of a package of seven bilateral agreements, called ‘Bilateral Agreements I’2. The FMP Agreement [1999] entered into force on 1 June 2002, for the then Community of the fifteen3. The agreement has been adapted and enlarged to new EU member States, for three times. The first protocol entered into force in 2006 (after the first EU enlargement of 2004 towards East); the second in 2009 (enlargement to Bulgaria and Romania) and the third in 2017 (Croatia).

§1.1 -General description

The bilateral agreement is divided into two parts: Title I (art. 1-9 – ‘Basic provisions’), which sets mutual rights of EU and Swiss citizens in the territory of the counterpart; and Title II (art. 10-25 – ‘General and final provisions’), which deals with derogations from those rights and sketches an institutional framework. Three annexes complete the picture by developing the provisions set in the main agreement.

The basic rights provided for the citizens of the parties comprise: the right of entry (art. 3); the right of residence and access to an economic activity (art. 4); the right of persons providing and receiving services (art. 5); the right of residence for persons not pursuing an economic activity (art. 6); the right to equal treatment with nationals in respect of access to, and the pursuit of, an economic activity, and living, employment and working conditions; the right to occupational and geographical mobility; the right to stay in the territory of a contracting party after the end of an economic activity; the right of residence for members of the family, irrespective of their nationality; the right of family members to pursue an economic activity, irrespective of their nationality; the right to acquire immovable property insofar as this is linked to the exercise of the rights conferred by the agreement {art. 7 lit. a) to f)}; and the right to the recognition of diplomas, certificates and other qualifications (art. 9).

1 _{Hereinafter, FMP Agreement or simply “bilateral agreement”.} 2

The subjects of the agreements of the package were: 1) Free movement of persons; 2) Technical barriers to trade; 3) Public procurement markets; 4) Agriculture; 5) Research; 6) Civil aviation; 7) Overland transport [Swiss Federal Administration 2017g].

3 _{In order to avoid misunderstandings, from now on I will just refer to the European Union (EU) even in} cases where it was still the European Community.

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] The most relevant provisions of Title II are: the standstill clause (art 13); the reference to EU Law (art. 16); the continuation of acquired rights after denunciation or termination of the agreement (art. 23); and the most political clause: the ‘guillotine clause’ (art. 25.4, see also

infra §3.3.2 -).

§1.2 -The consensual safeguard clause

Art. 10 [FMP Agreement 1999] disciplines the consensual safeguard clause. Whereas the objective of the bilateral agreement is the realization of a full, complete freedom of movement between the parties (art. 1), the safeguard clause represents the exception to the rule and is applied as follows. It is comprised of a set of derogations, structured in a progressive way, which tend to preclude entry and residence of citizens of either party in(to) the territory of the counterpart. However, some derogations apply unilaterally for Switzerland. There are three categories of derogation.

First, «For a maximum period of two years [after the entry into force of the Agreement],

the Contracting Parties may maintain the controls on the priority of workers integrated into the regular labor market and wage and working conditions applicable to nationals of the other Contracting Party» (art. 10.2). In practice, this derogation entails the right of either

party to national preference. However, the Joint Committee (see infra, §1.3 -) may, within one year, «consider whether these restrictions need to be maintained» and may reduce the period of application.

The second derogation (art. 10.1 and 10.3) can only be applied by Switzerland. For a period of five years after the entry into force of the Agreement, it may maintain quantitative limits (contingents) in respect of access to an economic activity with regard to two categories of persons: 1) residents for a period of more than four months and less than one year; and 2) residents for a period equal to, or exceeding, one year. Anyway, the right to impose these limits is limited likewise: Switzerland must guarantee a minimum quota of residence permits per category, as set in art. 10.3.

The third derogation (art. 10.4) also regards Switzerland unilaterally. «[I]f, after five years

and up to twelve years after the entry into force of the Agreement, the number of new residence permits of either categor[y] in a given year exceeds the average for the three preceding years by more than 10%, Switzerland may, for the following year, unilaterally limit the number of new residence permits of that category […] to the average of the three

preceding years plus 5%. The following year, the number may be limited to the same level»4. However, the minimum quotas set in art. 10.3 are the lowest imposable limit.

No quantitative restrictions may be imposed on residence for less than four months (art. 10.1), to persons providing services (art. 5.4), to persons who were authorized to pursue an economic activity in the territory of the Contracting Parties before the Agreement's entry into force (art. 10.5) nor to frontier workers (art. 10.7).

Art 14.2 furtherly sets that «[i]n the event of serious economic or social difficulties, the

Joint Committee shall meet, at the request of either Contracting Party, to examine appropriate measures to remedy the situation. The Joint Committee may decide what measures to take […]. The scope and duration of such measures shall not exceed that which is strictly necessary to remedy the situation. Preference shall be given to measures that least disrupt the working of this Agreement».

The periods of actual application of restrictions vary between the original agreement and the protocols subsequent to EU enlargements5 (see also infra, Figure 1), however the applied system is substantially the same, setting a twelve-years round with different restrictions before to reach a complete freedom of movement. The years count is restarted, for the interested countries, every time a new protocol enters into force. At the moment of publication, Switzerland is applying the third derogation for Bulgaria and Romania [Swiss Federal Administration 2018b] and the first derogation for Croatians [Swiss Federal Administration 2018c].

4 _{For instance, this rule was applied in 2013-2014 to the first fifteen EU signatories of 1999. Let us assume} that permits from 2009 to 2011 averaged 20.000, then leaped to 23.000 in 2012 (a 15% rise). Switzerland could limit the number of new permits to 21.000 in 2013 and 2014, since this would represent a 5% increase (1000) on the three-year average of 20.000 of the previous three years.

5 _{For instance, the periods of plausible application of the first derogation are longer in protocols (see art.} 10.2.a, 10.2.b and 10.2.c [FMP Agreement 1999]).

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […]

Figure 1 - The mechanism of the consensual safeguard clause – Application Source: Ufficio Federale di Statistica

§1.3 -The Joint Committee

The Joint Committee is the organ of discussion and conciliation established by the bilateral agreement (see art. 14). Art. 19, which deals with disputes settlement, states that «[t]he

Contracting Parties may bring a matter under dispute which concerns the interpretation or application of this Agreement to the Joint Committee» and «[t]he Joint Committee may settle the dispute»; however the highest barrier to the settlement of a controversy is that Joint

Committee’s decisions are reached… by mutual agreement (sic!)6. Moreover, it may take decisions only in cases provided by the agreement, in all other cases, it may only issue non-legally-binding recommendations. It has been argued, this limit is one of its major weaknesses [Maresceau 2011, 744-745].

The revision of the agreement is also subordinated to the mediation of the Joint Committee (art. 18).

6 _{Even though it is legally imprecise, affirming that the Joint Committee decides by unanimity gives a better} idea of its limits of decision.

EU-15/EFTA Cyprus and Malta EU-8

EU-2 Croatia

Unilateral contingents (applied before the Agreement’s entry into force) First derogation (national preference + contingents)

Second derogation (contingents only)

Free movement (with possibility to invoke the third derogation) Third derogation (reintroduction of contingents)

Complete free movement (no restrictions)

EU-15: Austria, Belgium, Denmark, Finland, France Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, UK, Sweden, Spain

EFTA: Iceland, Liechtenstein, Norway

EU-8: Estonia, Latvia, Lithuania, Poland, Czech Republic, Slovakia, Slovenia, Hungary EU-2: Bulgaria and Romania

G

P

EU

L

General Principles of EU Law are «general proposition[s] of Law of some importance,

from which concrete rules derive» [Tridimas 2006, 1]. They may find their expression in

some EU Treaty rules [Daniele 2010, 159] or they may be expressed in jurisprudence, in other words they can be derived from other norms of positive Law or from the Court of Justice of the European Union’s (ECJ) judgements [Tridimas 2006, 1]. Some of these principles were firstly recognized as such by the ECJ and later enshrined in Treaties’ amendments [Tridimas 2006, 13]. When applied, General Principles of EU Law may transcend the scope of application of specific areas of Law and they may be extended to the whole legal system.

Their nature is twofold: they may be referred to by the ECJ either as a result of an express reference contained in EU acts or they may be referred to by the Court spontaneously, to fill a

vacuum legis. The recognition of such a status by the ECJ is particularly relevant for

unwritten principles. Usually, they are aimed at achieving the objectives of the Treaties and they may not act against them [Tridimas 2006, 25-26]. Particularly the rules they describe or imply enjoy a great importance and an absolutely inderogable nature [Daniele 2010, 159]: therefore, they have the same legal status of the Treaties [Tridimas 2006, 51].

In order to better understand Switzerland’s position in respect to EU Law, it is convenient to describe relevant General Principles of EU Law related to the FMP Agreement first, to then analyze which Swiss provisions collide with them. This method is crucial to answer the central research question of this dissertation, because the importance of General Principles in EU Law is reflected in the FMP Agreement and its interpretation (see art. 16 thereof and

passim in this document). This could mean, in certain cases, that if Switzerland is breaching a

General Principle of EU Law, it might also be implicitly breaching the FMP Agreement. Moreover, since they enjoy the same legal weight of Treaty rules, the inderogability of General Principles impedes a review of the bilateral agreement, containing norms that breach them.

§2.2 -The Area of Freedom, Security and Justice

The Treaty on European Union (TEU) sets – beside a general objective as the promotion of peace, of European integration values and the well-being of peoples involved therein [TEU

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] 1992, art. 3.1] – some specific objectives linked to it by a nexus of functionality; the first of these objectives consists of offering to «citizens an area of freedom, security and justice

without internal frontiers, in which the free movement of persons is ensured in conjunction with appropriate measures with respect to external border controls, asylum, immigration and the prevention and combating of crime» [TEU 1992, art. 3.2]. This objective deals with the

development of the famous ruling of the Court of Justice of the European Union in the Van

Gend & Loos case [ECJ 1963], affirming that «this treaty is more than an agreement which merely creates mutual obligations between the contracting states» and «[the European Union] is a community based on the rule of law, inasmuch as neither its member states nor its institutions can avoid a review of the question whether the measures adopted by them are in conformity with the basic constitutional charter, the treaty» [ECJ 1986]. The Treaty on the

Functioning of the European Union (TFEU) punctually disciplines the ways to achieve this objective [TFEU 1957, art. 67-89].

§2.3 -The principle of free movement of persons

The achievement of an Area of Freedom, Security and Justice is entrusted to the shared competence of Member States and the Union [TFEU 1957, art. 4.1 lit. j)]. The Area of Freedom, Security and Justice entails a series of specific objectives and related powers conferred to the EU with regard to the subjects mentioned in art. 67 TFEU and specified in the opening dispositions of each of the four Chapters of Part III, Title V, following ‘General

Provisions’.

It is fundamental to understand that the basic requirement for the functioning of such an Area is that all persons may move freely and may freely exercise their activities [Draetta and Parisi 2014, 7]. These freedoms are enjoyed principally by the citizens of the Union, but also by any individual who finds himself within the Area (see, inter alia, European Council [1999, §§2-3]). This entails the attribution of specific competences to the EU: «ensuring the absence

of any controls on persons, whatever their nationality; […] carrying out checks on persons and efficient monitoring of the crossing of external borders; [as well as] the gradual introduction of an integrated management system for external borders» [TFEU 1957, art.

67.2; 77.1]. All this must be achieved according to the provisions of art. 77.2 TFEU: «(a) the

common policy on visas and other short-stay residence permits; (b) the checks to which persons crossing external borders are subject; (c) the conditions under which nationals of third countries shall have the freedom to travel within the Union for a short period; (d) any

measure necessary for the gradual establishment of an integrated management system for external borders; (e) the absence of any controls on persons, whatever their nationality, when crossing internal borders».

Through the years, even before the entry into force of the Treaty of Lisbon, the freedom of movement was extended with the help of both EU Law development and ECJ’s jurisprudence [Draetta and Parisi 2014, 21]. Particularly, the role of the ECJ was relevant in extending the freedom of movement to recipient of services [ECJ 1976; ECJ 1984] and tourists [ECJ 1989]. Nowadays it is generally affirmed exactly with regard to the «establishing an area of

freedom, security and justice» [TEU 1992, 12th recital; art. 3.2] and specifically with regard to European citizens in art. 21.1 TFEU [1957]. It is a directly applicable right for those who enjoy European citizenship and an objective to achieve for third States citizens entering the (nowadays called Schengen) Area [Draetta and Parisi 2014, 22]. This principle, together with that of non-discrimination (see infra §2.4 -), was later enshrined in the Charter of Fundamental Rights [ChFREU 2000, art. 21, 45], which, since the entry into force of the Treaty of Lisbon, has the same legal status of the Treaties1.

After the entry into force of the Treaty of Lisbon, the ECJ has maintained its broad interpretation on the principle of freedom of movement2.

§2.4 -The principle of non-discrimination

Art. 2 and 3.3 of the TEU set the fundamental framework and legal basis of the principle of non-discrimination. Various articles of the TFEU comprise further provisions: art. 18 sets a general ban on discrimination, which is repeated in Title IV, concerning free movement of persons, services and capital (art. 45.2, 49 and 57). Moreover, art. 19 provides to «take

appropriate action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation» and art. 157.1 prohibits discrimination in salaries

paid to male and female workers. According to the ECJ, these provisions must be interpreted in a very broad way: for instance, in Case 152/73 (Sotgiu v. Deutsche Bundespost) [ECJ 1974], the Court held that

«The rules regarding equality of treatment, both in the treaty and in article 7 of regulation n.° 1612/68, forbid not only overt discrimination by reason of nationality but also all covert forms of discrimination which, by the application of other criteria of differentiation, lead in fact to the

1 _{Cf. TEU [1992, art. 6.1] and TFEU [1957, protocol n.° 30].} 2 _{See, inter alia, the Shomodi case [ECJ 2013a].}

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] same result. This interpretation, which is necessary to ensure the effective working of one of

the fundamental principles of the community, is explicitly recognized by the fifth recital of the preamble to regulation n.° 1612/68, which requires that equality of treatment of workers shall be ensured 'in fact and in law'. It may therefore be that criteria such as place of origin or residence of a worker may, according to circumstances, be tantamount, as regards their practical effect, to discrimination on the grounds of nationality, such as is prohibited by the treaty and the regulation».

[ECJ 1974]

In other words, the Court established that hidden or indirect discriminations, whenever they have the same effect of direct discriminations, must be equally avoided.

The scope of application of the principle of non-discrimination was also interpreted extensively. The ECJ has in fact ruled on norms only marginally related to the scope of application of the Treaties. In the Cowan v. Trésor public case [ECJ 1989], it faced the case of a British citizen, who, while on vacation in France, underwent an assault and was denied compensation provided in those circumstances only to French nationals. After qualifying Mr. Cowan’s position as recipient of services under art. 56 TFEU, the Court ruled

«[…] the prohibition of discrimination is applicable to recipients of services within the meaning of the Treaty as regards protection against the risk of assault and the right to obtain financial compensation provided for by national law when that risk materializes».

[ECJ 1989]

France objected that relevant legislation belonged to criminal procedural (French) Law and that subject is not comprised in the Treaties, but the Court rejected the objection, stating

«Although in principle criminal legislation and the rules of criminal procedure, among which the national provision in issue is to be found, are matters for which the Member States are responsible, the Court has consistently held […] that Community law sets certain limits to their power. Such legislative provisions may not discriminate against persons to whom Community law gives the right to equal treatment or restrict the fundamental freedoms guaranteed by Community law».

[ECJ 1989]

Another significant case is Garcia Avello [ECJ 2003], where the Court upheld the practice followed by the Belgian administration to register persons born in Belgium and enjoying Belgian citizenship only with their father’s surname a violation of art. 12 EC (now art. 18 TFEU), whereas in Spain the registration of the same persons would be done with both

parents’ surnames. The Court, while recognizing that «as Community law stands at present,

the rules governing a person's surname are matters coming within the competence of the Member States» noted that «[they] must none the less, when exercising that competence, comply with Community law». Moreover it affirmed Belgium was applying a discrimination

because «Belgian nationals who have divergent surnames by reason of the different laws to

which they are attached by nationality may plead difficulties specific to their situation which distinguish them from persons holding only Belgian nationality, who are identified by one surname alone». A similar case brought to the Court was Grunkin [ECJ 2008a], in which the

Court forbade Member States to refuse to recognize a child's surname differently registered in another Member State.

Furthermore, the ECJ has developed the concept of autonomy of the principle of

non-discrimination, which entails the right of the Court to rule on the application of the principle

of non-discrimination to cases not mentioned in the Treaties [Daniele 2010, 161]. Especially significant with regard to the autonomy of this principle is the Mangold v. Helm case [ECJ 2005]. German legislation on fixed-term job contracts had been modified several times to widen the chances for elder workers to be hired for a fixed term without restrictions. Particularly the threshold of age to enjoy that right was lowered from 60 to 58 years, and subsequently (but only for a limited period) to 52 years. Thanks to that norm, Mr. Mangold, aged 56, had gotten a fixed-term job. He then asked the German Arbeitsgericht3 to make the

expiration of his contract void, invoking a violation of art. 6 of Council Directive 2000/78/EC of 27 November 2000, establishing a general framework for equal treatment in employment and occupation. The Court came to the conclusion that German legislation was a disproportionate mean to help elder workers in getting a job. Germany objected that the deadline to enact the directive had not expired neither at the moment Mr. Mangold had signed his contract, nor at the moment the Arbeitsgericht was deciding on the matter. The Court did not consider these circumstances relevant. In fact, the principle of non-discrimination preexisted to the directive and

«[…] the source of the actual principle underlying the prohibition of those forms of discrimination [can be] found […] in various international instruments and in the constitutional traditions common to the Member States […]. Where national rules fall within the scope of Community law, [as it is the case with the German legislation in question], the Court must

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] provide all the criteria of interpretation needed by the national court to determine whether

those rules are compatible with such a principle». [ECJ 2005]

Hence, the Court seems to be asking German judges not to apply the national norm, just because it contravenes the general principle of non-discrimination4.

Post-Lisbon jurisprudence has confirmed the ECJ’s previous view with regard to non-discrimination5.

An important exception to this principle however, exists, and may even be seen as a complementary principle as general as that of non-discrimination. Despite the numerous preliminary questions received by the Court, it has strongly upheld that “reverse discriminations” are not relevant in the realm of EU Law. Reverse discriminations happen when a EU Member State applies an unfavorable treatment to its nationals but not to other EU citizens6. That being said, the broadness of this exception has been reduced by the evolution of EU free movement Law and by the ECJ’s jurisprudence, in the Post-Lisbon era, and some authors even uphold it is «somewhat obsolete» [Iglesias Sánchez 2018].

§2.5 -Other relevant principles

A second category of General Principles is that of General Principles of Law common to EU Member States. Among these, two are relevant in the present case. That of protection of

legitimate expectations, which can be invoked in the case of a sudden and unforeseeable

provision modification, not justified by imperative rationales of general interest7; and the

adversarial principle, under which whenever EU organs and institutions (but also national

4 _{Other similar relevant cases are: Kücükdeveci v. Swedex GmbH & Co. [ECJ 2010], Bartsch v. Bosch und}

Siemens Hausgeräte (BSH) Altersfürsorge GmbH [ECJ 2008b], and SECAP SpA (C-147/06) and Santorso Soc. coop. srl (C-148/06) v. Comune di Torino [ECJ 2008c].

5 _{See, inter alia, X., Y. and Z. v. Minister voor Immigratie en Asiel [ECJ 2013b], sive Blanka Soukupová v.}

Ministerstvo zemědělství [ECJ 2013c]

6 _{See, for instance: Steen v. Deutsche Bundespost [ECJ 1992]; sive (not necessarily regarding the principle} of free movement of persons): joined cases C-64/96 and C-65/96 [ECJ 1997]. It is interesting, in this respect, that the Court, while upholding that reverse discriminations are a purely internal matter of Members States, continues to respond to preliminary questions received, motivating this way: «[the] interpretation of

provisions of Community law might possibly be of use to the national court, having regard too to situations classed as purely internal, in particular if the law of the Member State concerned were to require every national of that State to be allowed to enjoy the same rights as those which a national of another Member State would derive from Community law in a situation considered to be comparable by that court» [ECJ

2008d].

7 _{See, even though with regard to a subject different from the freedom of movement, the Mulder v. Minister}

authorities acting on their behalf) intend to enact an unfavorable provision against a person, they must allow the latter to present its point of view, before the provision is enacted8.

Part III

T

“A

”

§3.1 -The course of events

On 9 February 2014, Swiss people were called to vote upon the popular initiative (viz. referendum) «Gegen Masseneinwanderung»1 to limit mass immigration. Its declared rationales were that the surplus of (legal) immigrants in Switzerland is unsustainable [AMI organizing committee 2014]. Despite the recommendations of the federal parliament and of the Federal Council (viz. the federal government) [Swiss Federal Administration, 2014a], 50,3% of voters voted in favour and the initiative passed [Swiss Federal Administration, 2014b]. Therefore a new constitutional article, namely art. 121a, was created [Swiss Fed. Const., 1998]2. It states:

Art. 121a – Control of immigration

1 Switzerland shall control the immigration of foreign nationals autonomously.

2 The number of residence permits for foreign nationals in Switzerland shall be restricted by annual quantitative limits and quotas. The quantitative limits apply to all permits issued under legislation on foreign nationals, including those related to asylum matters. The right to permanent residence, family reunification and social benefits may be restricted.

3 The annual quantitative limits and quotas for foreign nationals in gainful employment must be determined according to Switzerland's general economic interests, while giving priority to Swiss citizens; the limits and quotas must include cross-border commuters. The decisive criteria for granting residence permits are primarily an application from an employer, ability to integrate, and adequate, independent means of subsistence.

4 No international agreements may be concluded that breach this Article. 5 The law shall regulate the details.

[Swiss Fed. Const., 1998]

Moreover, art. 197 [Swiss Fed. Const. 1998] was amended as follows:

Art. 197 - Transitional provisions following the adoption of the Federal Constitution of 18 April 1999

1 _{“Against Mass Immigration”, hereinafter AMI.}

2 _{The reader should not be surprised by the fact that any Swiss Constitution (either federal or cantonal) is a} very flexible constitution. In Switzerland, it is indeed easier to amend the Constitution by popular initiative, than to amend an existing, enforceable act.

[…]

11. Transitional provision to Art. 121a (Control of immigration)

1 International agreements that contradict Article 121a must be renegotiated and amended within three years of its adoption by the People and the Cantons. 2 If the implementing legislation for Article 121a has not come into force within

three years of its adoption by the People and the Cantons, the Federal Council shall issue temporary implementing provisions in the form of an ordinance. [Swiss Fed. Const., 1998]

Foreseeing the implied clashes between the application of art. 121a [Swiss Fed. Const., 1998] and the bilateral agreement, the European Commission reacted excluding Switzerland from the project Erasmus+ starting from the academic year 2014/2015, therefore assigning it the status of third country [Economiesuisse.ch 2017]. Moreover, the Commission decided to exclude Switzerland also from the program Horizon 2020, cutting EU funds to the CERN in Geneva [Tio.ch 2015]. Those funds were reinstated during 2016, after Switzerland approved the third protocol to the FMP Agreement, extending coverage to EU newly-admitted Croatian nationals [Swiss Federal Administration 2018a], while restrictions to Erasmus+ remain applicable to this day [Sciencemag.org 2014; Tio.ch 2017].

In July 2014, Switzerland asked the EU Commission to review the bilateral agreement on free movement of persons because of the legal clashes with the Swiss federal Constitution and the then EU High Representative for Foreign Affairs and Security Policy, Catherine Ashton3, directly answered in the negative [Swiss Federal Administration, 2014c; 2014d]. Despite the differences in viewpoints, Switzerland insisted on renegotiation and proceeded on the path thereto [Agenceurope.eu 2014; Reuters.com 2014; Swiss Federal Administration 2014e].

Switzerland’s aim was the renegotiation of – at least – the consensual safeguard clause in the sense to prolong or reintroduce its applicability for all EU member State’s citizens, and it decided that, in case no agreement thereon will be found, a Swiss unilateral safeguard clause will be enacted [Swiss Federal Administration, 2015a; 2015b]. Consequently, on 16 December 2016, the Swiss Federal Assembly4 approved the modifications to the Federal Act

3 _{Ashton’s institutional capacity, in this respect, was twofold: on the one hand, she was holding the office of} the High Representative for the CFSP and on the other she was also ex officio one of the Vice Presidents of the European Commission. Obviously, a position expressed in a letter by a Vice President of the Commission acquires a much more significant legal weight, rather than a political statement by the High Representative on the Foreign Policy side, EU-Switzerland relationships being primarily defined in economic terms. Using her main role of member of the Commission, and that of High Representative as such, the Community method and the Commission’s services can indeed legally back up the High Representative’s stances.

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] on Foreign Nationals (FNA) in order to amend it in accordance with the federal constitutional provisions; finally the Federal Council modified relevant ordinances, as well, under art. 197.11 of the Federal Constitution [FNA, 2005; Swiss Federal Administration 2017a; 2017b].

§3.2 -Switzerland’s arguments

§3.2.1 -The agreement on the European Economic Area case (Opinion 1/91)

One way Switzerland could argue not to be bound by EU Law standards5 through the provisions of the FMP Agreement is to recall Opinion 1/91 of the ECJ, which stated that

«The fact that the provisions of the agreement and the corresponding Community provisions are identically worded does not mean that they must necessarily be interpreted identically […]. [T]he provisions of the EEC Treaty on free movement […], far from being an end in themselves, are only means for attaining […] objectives. The context in which the objective of the agreement is situated also differs from that in which the Community aims are pursued. The EEA is to be established on the basis of an international treaty which, essentially, merely creates rights and obligations as between the Contracting Parties and provides for no transfer of sovereign rights to the intergovernmental institutions which it sets up. It follows from those considerations that homogeneity of the rules of law

throughout the EEA is not secured by the fact that the provisions of Community law and those of the corresponding provisions of the agreement are identical in their content or wording. It must therefore be considered whether the agreement provides for other means of guaranteeing that homogeneity».

[ECJ 1991, §§14-23]

Moreover, just like with the EEA Agreement, the desired homogeneity would be absent in Switzerland’s view because of the temporal limitation set in art. 16 of the FMP Agreement (see text infra, §3.3.1 -) and, even though declarations in the Final Act of the Agreement6 refer to the acquis communautaire:

5 _{In this dissertation, I will often refer to EU Law standards. EU Law standards are EU Law principles and} norms, either contained in the Treaties, EU secondary Law or in the ECJ’s jurisprudence, which were translated by means of a bilateral agreement outside the territory of the Union. In other words, EU Law standards are those parts of the acquis communautaire which a bilateral agreement between the EU and a third party exports outside the Union’s territory. In the case of the FMP Agreement [1999] these standards are numerous (see infra, §3.3.1 -).

6 _{According to art. 15 of the FMP Agreement, the Final Act is not an integral part thereof. Hence,} declarations are merely a non-binding manifestation of intentions.

«[…] The Contracting Parties undertake merely to introduce into their respective legal orders a statutory provision to the effect that [bilateral agreement] rules are to prevail over contrary legislative provisions. It follows that compliance with the case-law of the Court of Justice […] does not extend to essential elements of that case-law which are irreconcilable with the characteristics of the agreement […]. It follows from the foregoing considerations that the divergences which exist between the aims and context of the agreement, on the one hand, and the aims and context of Community law, on the other, stand in the way of the achievement of the objective of homogeneity in the interpretation and application of [EU] law in [Switzerland]».

[ECJ 1991, §§27-29]

§3.2.2 -Application of relevant Swiss provisions and renegotiation of the bilateral agreement

Switzerland knows its new federal constitutional provisions clash with the bilateral agreement, therefore it is trying to renegotiate it. Meanwhile, it tries to apply its constitutional provisions without breaching the FMP Agreement. Five models to apply art. 121a [Swiss Fed. Const. 1998] have been forecasted [Swiss Federal Administration 2014f, 23-40] and they all clash, more or less, with the present provisions of the agreement. Switzerland is determined to maintain contingents also for EU citizens, yet the federal government (which gave an adverse opinion with regard to the referendum “Against Mass Immigration”) could hold the number of immigration permits high enough, in order to avoid a limitation de facto [Swiss Federal Administration 2014f, 7]. Moreover, the Swiss Federal Department for Foreign Affairs (FDFA) has declared that, since the limitation of immigration has a snowball effect on other political realms, this limitation must satisfy Swiss exigencies of foreign policy, as well as safeguard the welfare and the competitiveness of Swiss economy and finance, whereas these are all (previously existing) constitutional provisions [Swiss Federal Administration 2014f, 5]. Finally, the FDFA stated that

[…] [T]he application of art. 121a [Swiss Fed. Const. 1998] may not constitute a self-standing process, but it must keep into account jus cogens, migration and integration policy objectives, the constitutional mandate to promote the common good and the foreign policy objective to safeguard and develop stable relations with the European Union.

[Swiss Federal Administration 2014f, 14-15].

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] §3.3 -Legal issues

§3.3.1 -Bilateral Agreement on the Free Movement of Persons

References to EU Law standards in the bilateral agreement are numerous. For instance, the agreement opens with a list of objectives, very similar to those contained in EU Treaties.

Art. 1 – Objective

The objective of this Agreement, for the benefit of nationals of the Member States of the European Community and Switzerland, is:

(a) to accord a right of entry, residence, access to work as employed persons, establishment on a self-employed basis and the right to stay in the territory of the Contracting Parties; (b) to facilitate the provision of services in the territory of the Contracting Parties, and in particular to liberalize the provision of services of brief duration;

(c) to accord a right of entry into, and residence in, the territory of the Contracting Parties to persons without an economic activity in the host country;

(d) to accord the same living, employment and working conditions as those accorded to nationals.

[FMP Agreement 1999]

The application of principle of free movement (of persons, but also of services) as set in Part III, Title IV of the TFEU is easily recognizable therein and is also repeated in art. 5, 6 and 7, lit. b) to g).

Article 5 – Persons providing services

1 Without prejudice to other specific agreements between the Contracting Parties specifically concerning the provision of services (including the Government Procurement Agreement in so far as it covers the provision of services), persons providing services, including companies in accordance with the provisions of Annex I, shall have the right to provide a service in the territory of the other Contracting Party for a period not exceeding 90 days' of actual work in a calendar year.

2 Providers of services shall have the right of entry into, and residence in, the territory of the other Contracting Party:

(a) where they have the right to provide a service under paragraph 1 or by virtue of the provisions of an agreement mentioned in paragraph 1;

(b) or, if the conditions specified in (a) are not fulfilled, where they have received authorization to provide a service from the competent authorities of the Contracting Party concerned. 3 Nationals of a Member State of the European Community or Switzerland entering the territory

4 The rights referred to in this Article shall be guaranteed in accordance with the provisions laid down in Annexes I, II and III. The quantitative limits of Article 10 may not be relied upon as against persons referred to in this Article.

[FMP Agreement 1999]

Article 6 – Right of residence for persons not pursuing an economic activity

The right of residence in the territory of a Contracting Party shall be guaranteed to persons not pursuing an economic activity in accordance with the provisions of Annex I relating to non-active people.

[FMP Agreement 1999]

Article 7 – Other rights

The Contracting Parties shall make provision, in accordance with Annex I, for the following rights in relation to the free movement of persons:

(a) the right to equal treatment with nationals in respect of access to, and the pursuit of, an economic activity, and living, employment and working conditions;

(b) the right to occupational and geographical mobility which enables nationals of the Contracting Parties to move freely within the territory of the host state and to pursue the occupation of their choice;

(c) the right to stay in the territory of a Contracting Party after the end of an economic activity; (d) the right of residence for members of the family, irrespective of their nationality;

(e) the right of family members to pursue an economic activity, irrespective of their nationality; (f) the right to acquire immovable property in so far as this is linked to the exercise of rights conferred by this Agreement7_;

(g) during the transitional period, the right, after the end of an economic activity or period of residence in the territory of a Contracting Party, to return there for the purposes of pursuing an economic activity and the right to have a temporary residence permit converted into a permanent one.

[FMP Agreement 1999]

The principle of non-discrimination is mentioned generally in art. 1, lit. d), but it is also clearly stated in art. 2:

Art. 2 – Non-discrimination

7 _{This provision was needed because the purchase of real estate in Switzerland is limited for Swiss citizens,} as well, due to shortage thereof. Generally, foreign citizens undergo even more severe restrictions (see, Lex Köller [LAFE 1983]).

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] Nationals of one Contracting Party who are lawfully resident in the territory of another

Contracting Party shall not, in application of and in accordance with the provisions of Annexes I, II and III to this Agreement, be the subject of any discrimination on grounds of nationality. [FMP Agreement 1999]

as well as in art. 6, 7, lit. a) to f) (see text supra). Particular provisions with regard to the coordination of social security systems and diplomas, certificates and other qualifications are set in art. 8 and 9 of the bilateral agreement, in order to facilitate free movement and ensuring non-discrimination between Switzerland and the Union. The principle of protection of legitimate expectations and the adversarial principle are enshrined in art. 11 (‘Processing of

appeals’). Art. 12 covers «more favorable provisions», in other words reverse discriminations

(see supra, §2.4 -), and excludes them to be in breach of the Agreement. An important provision is mentioned in art. 16, which states:

Article 16 – Reference to Community Law

1 In order to attain the objectives pursued by this Agreement, the Contracting Parties shall take all measures necessary to ensure that rights and obligations equivalent to those contained in the legal acts of the European Community to which reference is made are applied in relations between them.

2 Insofar as the application of this Agreement involves concepts of Community law, account shall be taken of the relevant case-law of the Court of Justice of the European Communities prior to the date of its signature. Case-law after that date shall be brought to Switzerland's attention. To ensure that the Agreement works properly, the Joint Committee shall, at the request of either Contracting Party, determine the implications of such case-law.

[FMP Agreement 1999]

Annex I to the bilateral agreement further develops the provisions of the latter with regard to the freedom of movement of persons, equalizing it de facto to EU Law standards8. Annex II and III (on the co-ordination of social security schemes and on mutual recognition of professional qualifications, respectively), instead, contain abundant direct references to the application of various EU directives and regulations.

As we have seen supra (§3.2.1 -), the ECJ [1991] held that identical provision wording does not mean identical provision application, when the nature of provisions is different. This is indeed true, with regard to ECJ case law applicable outside EU territory. Yet, the point is,

8 _{For the opposite view, arguing the reluctance to directly and exactly refer to existent EU Law and} jurisprudence is the indication of the lack of a ‘EU legal enlargement’ towards Switzerland, see Peers [2000].

whenever a provision in a EU-Third Country bilateral agreement is derived from EU Law and the agreement itself mentions to refer thereto with regard to interpretation, the object and purpose of that provision can only be the replication of that EU Law norm outside EU territory. This is exactly the case of the EU-CH FMP Agreement. Of course there is no transfer of sovereignty, yet there is a Third Country’s consent to abide to a (quasi) identically-worded norm of EU Law. Opinion 1/91 [ECJ 1991] must therefore be interpreted in the sense that homogeneity may not be achieved because bilateral agreements are limited to certain aspects of (EU) Law, therefore not each and every EU Law rule and ECJ dictum is automatically exported on the bilateral agreement ratification day, but those EU rules relevant for the application of the bilateral agreement, instead, are. This is nothing more nor less than interpreting a bilateral agreement iuxta art. 31, Vienna Convention 1969, «in the light of its

object and purpose».

Moreover, the declarations made by both Switzerland and the Union in the Final Act of the bilateral agreement, which specifically mention the application of the acquis communautaire in the territories of the contracting parties as the basic commitment for the application of the agreement itself, should be interpreted as confirming the thesis that only acquis rules related to the object and purpose of the agreement are exported by means thereof, not the acquis as a whole [Swiss Federal Tribunal 2003; Borghi 2010, 318-321, 338-339]. Therefore, all the aforementioned provisions represent the proof, Switzerland has committed itself to apply EU Law standards in its territory, even though only to the extent of the provisions in the bilateral agreement.

§3.3.2 -Swiss Constitution

The broadness in the wording of art 121a and the imperativeness of art 197.11 [Swiss Fed. Const. 1998] (see text supra, §3.1 -) effectively constitute a clash of norms between the FMP Agreement and Swiss Law9. The bilateral agreement provides for limited quotas in immigration permits only on a temporary basis and with a limited nationality application (see

supra, §1.2 -). The problem then becomes the interpretation of that application by the

European Commission. And Jean-Claude Junker recently declared that, as far as the application of those constitutional articles acts within the framework set by the bilateral agreement, a direct collision (and violation) is avoided [Swissinfo.ch 2017]. This is actually

9 _{Cf. also the Mangold case [ECJ 2005] on the autonomy of the principle of non-discrimination and art. 16.2} of the FMP Agreement (see supra §2.4 - and §3.3.1 - respectively).

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] what Switzerland is doing right now (see infra, §3.3.3 -, §3.3.4 -). Nevertheless, three latent problems about the renegotiation of the bilateral agreement remain. First, General Principles of EU Law are non-negotiable. This is as well testified in the exchange of diplomatic notes between Switzerland and the EU on the subject [Swiss Federal Administration 2014c; Swiss Federal Administration 2014d]. As the Catherine Ashton answered to Switzerland’s request to review the bilateral agreement10:

The principle of non-discrimination, including equal treatment of all EU Member States, the right to exercise an economic activity and reside on the territory of the other party and the standstill clause constitute the essential basis of the consent of the European Union to be bound by the agreement. Renegotiating these principles with the objective of introducing quantitative limits and quotas, combined with a preference for Swiss nationals would be in fundamental contradiction to the objective of the Agreement on the free movement of persons. Following consultations with Member States, l regret that the EU is not in a position to agree with your request.

[Swiss Federal Administration 2014d]

That said, the loose interpretation of the EU Commission [Swissinfo.ch 2017], in exchange for a loose application of restrictions (see supra, §3.2.2 -), leaves at least a glimmer of light on this ground.

Secondly, some provisions of the bilateral agreement can cause problems.

Article 13 – Standstill clause

«The Contracting Parties undertake not to adopt any further restrictive measures vis-à-vis each other’s nationals in fields covered by this Agreement».

[FMP Agreement 1999]

As declared in the diplomatic note (see supra), the standstill clause is part of the foundation of the agreement, without which the agreement itself is meaningless. Moreover, art. 23 sets the principle of non-mutation of acquired rights.

Article 23 – Acquired rights

10

It is also diplomatic-wisely significant that the political level of communication was raised: the Swiss request was issued by the Federal Office for Migration and addressed to the EU External Action Service, while the answer was signed by the High Representative for CFSP (who is also a Vice President of the European Commission, see supra, Part III, footnote 3) and mailed to the President of the Confederation (who, at the time, was also the Head of the Department of Foreign Affairs).

«In the event of termination or non-renewal, rights acquired by private individuals shall not be affected. The Contracting Parties shall settle by mutual agreement what action is to be taken in respect of rights in the process of being acquired».

[FMP Agreement 1999]

Therefore, art. 23 constraints Switzerland’s margin of movement even in the case of termination of the agreement. Finally, art. 25.4 – known as “the guillotine clause” – stipulates that all seven bilateral agreements signed in 1999 shall cease to apply, as soon as one of them is terminated. This is of course more a political clause, which would cause political, more than legal problems; however, it remains important from the legal point of view, because termination could be invoked in case of an unlawful conduct (i.e. violation) by either party [Vienna Convention 1969, art. 60.1 read in conjunction with art. 60.3]. This problem could be resolved only through bilateral cooperation (i.e. political will).

Third, the populist Swiss People’s Party (SVP) has gathered signatures, and has already reached the required number thereof, to hold another referendum on a “black or white” decision about the (dis)application of the bilateral agreement; This initiative proposes to set a term of 12 months to negotiate with the EU on the abolition of the FMP Agreement, otherwise it would be terminated unilaterally [Financial Times 2018; CdT.ch 2018]. Although it must overcome several obstacles (an eventual counter-project and finally the referendum itself) and this takes time, the direction undertaken by Switzerland is seriously leading it into an inconvenient and unfavorable position, very similar to that of Great Britain after Brexit. And Brexit’s results in negotiating a bilateral agreement will surely influence the moves of both Switzerland and the EU in this respect.

§3.3.3 -Federal Act on Foreign Nationals and Federal Council ordinances

The Federal Act on Foreign Nationals (FNA) effectively sets some limits to immigration, yet it encompasses a legal limit, which safeguards EU citizens from being treated as “foreigners”. Art. 2 states:

Article 2 – Scope of application

1 This Act applies to foreign nationals, provided no other provisions of the federal law or international treaties concluded by Switzerland apply.

2 For citizens of member states of the European Community (EC), their family members, and employees posted to Switzerland by employers resident or with their registered office in these states, this Act applies only to the extent that the Agreement of 21 June 1999 between the

Alessandro Prest The legal obstacles to the revision of EU-Switzerland bilateral agreement on free movement of persons […] Swiss Confederation on the one hand and the European Community and their Member

States on the other hand on Freedom of Movement does not contain any different provisions or that this Act provides for more advantageous provisions.

[…] [FNA 2005]

Hence, limitation measures on free movement of persons and the principle of national precedence, set in art. 20 and 21 [FNA 2005], apply only to third-country citizens, other than those of the EU. It is therefore quite clear that Switzerland is not violating any FMP Agreement provisions via the FNA, at the moment. Moreover, we have seen supra (§1.2 -) that Switzerland is applying restrictions on the free movement of EU citizens, only iuxta art. 10.4.c of the FMP Agreement, by means of Federal Council ordinances [Swiss Federal Administration 2017c; 2018b]. These ordinances do not infringe any FMP Agreement provisions either, at the moment.

§3.3.4 -Unilateral safeguard clause

The major worry for the continuation of the bilateral agreement is the threatened use of a Swiss unilateral safeguard clause, different from the consensual ones prescribed in art. 10 thereof. The Swiss government has thought about it as a last resort, in case no agreement on the renegotiation of the present FMP Agreement can be found within a reasonable amount of time [Swiss Federal Administration 2015a; 2015b]. The application of such a unilateral clause would imply a series of breaches of the bilateral agreement. Aside from the principle of free movement of persons, which is the scope and objective of the treaty, a discrimination (prohibited by art. 2 of the FMP Agreement), would be applied by Switzerland to EU citizens on a twofold basis. For instance, let us suppose that Switzerland applied a general limited quota for EU citizens. This first-past-the-post principle, would give more rights to those who arrive in Switzerland first, discriminating the others. Furthermore, if Switzerland applied a permanent quota based on nationality, it would discriminate European citizens on that ground, whereas they must be conceived as a single, united group of people. Thirdly, from the point of view of International Law, discrimination is prohibited by numerous human rights treaties, which Switzerland is party to11. Therefore the application of such a safeguard clause would also be in breach of other International Law norms. Finally, art. 13 [FMP Agreement 1999]

(‘standstill clause’), would be breached if a unilateral safeguard clause was enacted. Again, here the matter melts with political will: if Switzerland will ever enact the unilateral safeguard clause without terminating the Agreement, it will incur in possible countermeasures and the result of that action definitely depends on the perception of costs and benefits on the side of Switzerland. In this respect, the supremacy of the FMP Agreement [1999] over Swiss Law has been confirmed by the Swiss Federal Tribunal12 in a judgement of 2015 [Swiss Federal Tribunal 2015; Swiss Federal Administration 2016, 2623].

12 _{The Federal Supreme Court of Switzerland. It is competent to rule on procedural aspects of the} application of the Law in almost every realm, see Swiss Fed. Const. [1998, art. 189].

Part IV

T

“W

!”

The Canton of Ticino (hereinafter, Canton Ticino or, simpliciter, Ticino) has ever since been a frontier land. The majority of its borders are shared with Italy and they also share an Italian exclave surrounded by Ticino1. Ticino also represents the majority of the Italian-speaking part of Switzerland; it has a very strong social and cultural link with some provinces of an Italian region (Lombardy), with which it shares many traditions and a common dialect, in fact they constitute a Euroregion [AEBR.eu 2018; RegioInsubrica.org 2018]. The cross-border bonds between the two are also testified by the intense smuggling activity, which has always been present2.

On 25 September 2016, following the popular approval of AMI, the people of Ticino have voted in favor of a cantonal popular initiative called “Prima I Nostri!”, roughly translatable as “We Go First!” (WGF), which is very similar to the federal one described in Part III [Swissinfo.ch 2016]. Starting from the belief that «[Ticinese] Labor market is under pressure

due to the wide foreign manpower coming to Ticino accepting starving wages» and that «many Ticinese lose their jobs [for this reason]», the promoters of the initiative declared that

one of the objectives was to apply the preference, coeteris paribus, for Swiss workers with respect to foreign workers. Moreover, an intention of this initiative was to apply the principle of reciprocity to legal impediments posed to Ticinese workers by other States (i.e. Italy). Finally, the scope of the initiative was «to find a urgent solution for Ticino, while waiting for

the federal application [of AMI] 3» [Canton of Ticino Administration 2016a]. Despite – again

– the negative recommendation of the Council of State4 and the Great Council5, the result of the vote was 58.3% in favor, while a (milder) counter-project supported by the Council of

1 _{Campione d’Italia.} 2

If, on the one hand, in the past, smuggling dealt mostly with goods (cigarettes and petrol towards Italy; oil, meat, fruit and vegetables towards Switzerland), nowadays, after Switzerland has become party to the Schengen Agreement, due to the mass influx of migrants, the traffic is more concentrated upon human beings [IlGiorno.it 2014].

3 _{As we have seen supra, the application of art. 121a and 197.11 of the federal Constitution (namely the} modification of the FNA and of Federal Council ordinances related thereto), was only enacted later than the WGF referendum: on 16 December 2016 and on 6 September 2017 respectively [Swiss Federal Administration 2017d].

4 _{The cantonal government.} 5 _{The cantonal parliament.}

State was simultaneously rejected by 57.8% of the voters [Canton of Ticino Administration 2016a]. Therefore, relevant parts of the cantonal Constitution were amended, as follows:

Art. 14 – Social objectives

1 The Canton provides that: […]

b) In the labor market, those who reside on its territory be privileged, in case of equal professional qualifications, in respect to those who come from abroad (application of the principle of preference of Swiss nationals)

[…]

j) No citizen of its territory is dismissed following a discriminatory decision of substitution of indigenous manpower with foreign manpower (substitution effect) or that he [the citizen] must not accept significant salary reductions due to the indiscriminate influx of foreign manpower (salary dumping)

[…]

Art. 49 – Cross-border cooperation and minimum standard of cross-border cooperation

[…]

2 Whenever a foreign State limits with internal regulations or [other] systems of application disincentivizing the execution, in its territory, of international treaties concluded with the Confederation, the Canton [of Ticino] shall apply the same minimum standard while respecting the principle of reciprocity in application.

Art. 50 – Mandate to [cantonal] authorities

1 In relations with […] neighboring countries, [cantonal] authorities must promote and safeguard the identity, the autonomy, the social objectives and the economic interests of the Canton6_.

2 In relations with neighboring countries the [cantonal] authorities modulate the labor market according to the necessities of those who live in the territory of the Canton, promoting the healthy professional complementarity between Swiss and foreign workers, avoiding indigenous manpower substitution with foreign manpower (substitution effect) and the race to lower salaries (salary dumping).

[Constitution of Ticino 1997]

6 _{This provision was not part of the amendment, I simply added it in order to offer a better understanding of} the subject-matter.