‘Toughest nuts’ still to crack in EU-Swiss talks

Date: 26/09/1996

By Elizabeth Wise

AFTER years of gloomy signals from negotiators struggling to dismantle barriers between Switzerland and the EU, there are signs of optimism that a deal is finally in sight.

But it will be up to EU transport ministers to keep buoyant hopes that an accord can be struck by the end of this year, when they meet next week.

At that meeting, member states will be asked just how much they are willing to give to help reach that goal.

Both Swiss and EU officials report progress in recent talks on the free movement of workers and heavy-laden cargo lorries across their common frontier.

But both sides are also careful to point out that the toughest nuts have yet to be cracked.

“Now that we have cleared out everything, we are left with the real hard-core problems,” said an aide to Transport Commissioner Neil Kinnock.

At issue still is the weight limit on EU lorries entering or crossing Switzerland. The Union wants to be able to send 40-tonne loads over Alpine roads; Switzerland has agreed to up its current 28-tonne limit to 34 tonnes by 2001 and to 40 tonnes by the year 2005, but not before.

When it does increase the weight allowance, Berne wants to tax the trucking companies for the strain they will put not only on the country's infrastructure but also on its environment.

The EU is now considering establishing a similar 'true cost' tax on transporters to help atone for pollution and the resulting health risks for people living along lorry routes. Such taxes would also be designed to encourage shippers to use rail and river routes.

Arguing that the Union needs taxes of its own to combat internal congestion and pollution, the Commission is preparing a 'green book' which proposes making road taxes inside the EU more closely related to environmental and social costs.

Ideally, Union and Swiss governments would set up compatible tax regimes. But, with EU member states divided over the green book, that remains some way off.

In the meantime, Berne does not want to give in too soon to EU demands for higher tonnage limits, fearing that once it allows the heavy trucks in, it will lose any leverage it has to oblige the Union to levy taxes.

For their part, EU governments do not want to be forced by Berne to do anything, much less impose unpopular taxes. But they fear that if they do not move to set up a tax system of their own, Berne might go it alone in introducing draconian taxes.

“The Union does not want the Swiss to dictate the timetable, but it fears that Switzerland will set up a high tax of its own,” said an EU official, adding that the Union also wanted protection from Swiss taxes if the two sides had not agreed on a compatible regime before 2005.

Commission officials say that Kinnock will discretely look for cracks in member states' positions when transport ministers meet next Thursday (3 October).

“The last thing ministers want is the game forced by Switzerland, but we want to convince the Swiss that we are coming along,” said one.

Negotiators have some justification for being proud of the progress made in “extensive discussions” over the summer. For the first time, rather than working from two separate documents presenting the EU and Swiss positions, they have begun working with a single text merging most of the two stands, which they hope will serve as a draft of the final accord.

“This marks a new phase,” said a Swiss official, echoing the optimism of a Commission official who said that the two sides were in agreement on “23 of the 25 pages in the draft legal text”.

But other problems remain. A dispute over air transport still needs to be resolved, with Switzerland calling for its carriers to be allowed to carry passengers between EU cities. Currently, Swissair or Crossair flights out of Zurich or Geneva to Madrid cannot take on passengers at a stop-over destination, occasionally forcing them to cancel flights which are half-full. However, rival EU airlines have little incentive to give Swissair access to their markets.

Another issue as yet unsettled concerns the right of EU citizens to work in Switzerland. A Swiss quota system limits the numbers of foreigners who may work there. For now, the ceiling for EU citizens is higher than the number of work permit applicants, prompting the Swiss to argue that they are already fulfilling Commission demands for the free movement of people.

Talks have long been stalled over Berne's desire to retain its right to set quotas in case the influx should grow dramatically. Now Berne is offering to raise the EU contingent inside the quota - at the expense of non-Union foreigners - when EU demand requires.

Internal Market Commissioner Mario Monti is reportedly ready to discuss giving Switzerland a 'safeguard clause' for a limited number of years which would allow Berne to intervene if it deemed the incoming traffic was too great. After that still undetermined period, however, any raising or lowering of ceilings would have to be agreed by both parties.

Monti, whose meeting with top officials in Berne last week was described by the latter as an important step, is “ready to discuss” the details, according to his aides.

Kinnock's success at next week's transport ministers' meeting will be crucial to the fate of the accord.

If all goes well, say Swiss officials, the negotiations will intensify. EU foreign ministers may discuss developments at the end of October to inject some heavyweight political impetus into the talks.

But whether a deal is possible before the end of the year remains an open question.

“The prospects are good,” said a Swiss diplomat, “but there are still political points to be worked out.”