Why does Switzerland want a new trade deal with the UK?

Helena Bachmann
Helena Bachmann - [email protected]
Why does Switzerland want a new trade deal with the UK?
Switzerland's Economy Minister Guy Parmelin is meeting with his UK counterpart today. Photo by Fabrice COFFRINI / AFP

Switzerland and the UK kick off negotiations for a new free trade agreement on Monday. What exactly is at stake for Switzerland?


On Monday, Britain's International Trade Secretary Kemi Badenoch was set to meet with Swiss Economy Minister Guy Parmelin in Bern to discuss modernising the free trade agreement (FTA) between the two countries.

The current agreement was brokered in the 1970s, but according to Badenoch "there’s a huge prize on offer to both the UK and Switzerland by updating our trading relationship to reflect the strength of our companies working in areas ranging from finance and legal, to accountancy and architecture."

From the Swiss side, an updated agreement is important, as the UK is one of Switzerland's leading export markets.

"The existing contractual relationship is now to be adapted to current needs and further developed in the direction of a trade agreement that is as comprehensive as possible," the Federal Council said in a press release on Monday, adding that negotiations will continue in London during the week beginning May 22nd.

"Switzerland is aiming to integrate provisions on the trade in services, investments, digital commerce, intellectual property rights, small and medium-sized enterprises, and trade and sustainable development," the government pointed out. "The new agreement is intended to ensure non-discriminatory market access in several areas that are important for the Swiss economy. It also aims to improve legal certainty for economic exchange and contribute to cooperation between the two countries."

What post-Brexit relationship has Switzerland had with the United Kingdom?

According to the Federal Department of Foreign Affairs (FDFA), the two nations "have maintained close relations over many years founded on similar ideas in areas such as the rule of law, fundamental freedoms, social and economic order, and good governance, and with a special focus on economic and financial market issues."

Brexit, however, was a game-changer, as it "meant that numerous provisions which used to be regulated under EU law must now be negotiated bilaterally," the FDFA said, adding that Bern negotiated a series of follow-up agreements with the UK as as part of its 'Mind the Gap' strategy.

The strategy ensured that most of the existing rights and obligations between the two countries continue to apply.


What about UK citizens who live in Switzerland?

Before Brexit, British nationals had the same rights as their European Union / EFTA counterparts — that is, free access to Switzerland's labour market and residency.

But after the United Kingdom left the EU, its citizens were categorised as third-country nationals.

However, this rule doesn’t apply to British nationals who had moved to Switzerland before the end of the Brexit transition period (December 31st, 2020) — they have retain all their existing rights for residence and employment.

Others must comply with the same strict rules as other non-EU / EFTA nations.

 The Swiss government had nevertheless made a special 'gesture' toward British citizens by granting them a separate set of quotas that is, separate from other third-country nationals): 2,100 under a B permit and 1,400 under an L permit.

READ ALSO: Switzerland's planned work quotas for third-country nationals



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