Switzerland wants EU referendum to clarify its position in Europe

7 years ago - Published in Finance, Fundamental Analysis

Swiss President Doris Leuthard has said a referendum would help clarify the country’s position on its relationship with the European Union.

Tensions between Switzerland and the EU have increased in recent days after the EU granted Swiss stock exchanges access to EU markets for only one year. The Markets in Financial Instruments Directive and Regulation (called MiFID II/MiFIR), will come into force on January 3. Swiss officials slammed the decision to allow access for only a year, calling it discriminatory, and threatened to retaliate.

Switzerland is not a member of the EU, but its tensions with Brussels started as Britain has been negotiating its withdrawal from the multinational bloc, including seeking a new form of trade relationship with the rest of its members.

Switzerland and the EU have been in talks to establish a new framework to replace over 100 bilateral trade agreements which regulate relations between Brussels and Bern.

Bilateral ties, however, soured last week after the EU granted Swiss stock exchanges only limited access to the bloc. Swiss officials slammed the move, calling it discriminatory and threatened to retaliate.

"The bilateral path is important. We therefore have to clarify our relationship with Europe. We have to know in which direction to go. Therefore a fundamental referendum would be helpful," Leuthard told the Swiss newspaper Sonntags Blick on Sunday.

The deal was intended to ensure that Switzerland adopts relevant EU laws in exchange for enhanced access to the bloc's single market, which is crucial for Swiss exports.

But the deal faces opposition from the anti-EU Swiss People's Party (SVP), which is currently the largest voting bloc in parliament.

Leuthard, who steps down from the rotating presidency at the end of the year, said the latest row had not overshadowed her year in the rotating office.

"Of course, the differences with Brussels are now in focus," she said in the newspaper Blick. "Here our attitude is clear – for the EU to link such a technical thing like stock exchange equivalency with a political question like the framework treaty that is not possible."

"We do not accept such a power play!" she added. "But it's part of politics, we have to endure that." Leuthard said she understood Swiss suspicion towards the EU, but said there is no alternative to reaching an agreement with the bloc that generates about 66 percent of Swiss trade.