# 15 / 2016

Brexit and Switzerland

The Brexit vote marks a historical break for Europe which will affect Switzerland much more than previously assumed. This is the conclusion of a survey among members of economiesuisse. Preserving legal certainty in the traditionally close relations between Switzerland and the UK will be crucial in the future. At the same time, change creates opportunities and they should be seized whenever possible.



Executive summary

With the decision of British voters for the departure of Great Britain from the EU, Europe faces a number of major political and economic challenges. Aside from unbundling the complex web of compe-tencies that ties the EU to its outgoing member, the relationship between the UK and other important trading partners needs to be redefined as well. Switzerland is one of them. Both countries are among each other’s most important trading partners and investors. As a result, the British exit from the EU concerns Switzerland directly. An industry-wide survey conducted by economiesuisse supports this conclusion. It assessed the importance of the British market for different businesses and analyzed the challenges faced by Swiss companies in the wake of Brexit. They differ by sector but will have to be addressed quickly and jointly. The core issue is the substantive preservation of the bilateral treaties between Switzerland and the EU (notably bilateral agreements I & II and free trade agreement Switzerland-EU). They lose their validity for Great Britain after Brexit.

The key issue in any future arrangement is the continuation of full market access. At the same time, economic relations should be deepened, e.g. in financial services. Also, both governments should increase their joint efforts to remove administrative obstacles between the two countries.

Positions of economiesuisse

  • Switzerland is undoubtedly part of the “inner circle” of the most important trading partners: Switzerland must continually raise awareness among its British partners about the importance and benefits of Swiss-British economic relations and position itself in the circle of countries with which the UK will want to re-negotiate economic relations right away.
  • Saferguarding Status Quo+ in Mutual Market Access and Legal Certainty: In order to guarantee legal certainty a bilateral treaty solution must be ready by the time Great Britain leaves the EU — possibly in the form of a grandfathering. The most important thing, in any event, is the substantive preservation of the bilateral agreements I and II and the free trade agreement Switzerland-EU. The need is for a comprehensive free trade agreement of the latest generation which includes a liberalization of the service trade and closer regulatory cooperation (status quo+).
  • Seize Opportunities to Expand Market Access: Opportunities to discuss the expansion of market access with Great Britain must be seized. Looking beyond the existing treaties, Swiss business sees potential, among other things, in regulatory harmonization and equivalency or the liberalization of origin rules.
  • Switzerland Is Open for Discussions About  EFTA Membership: Swiss business is basically open to possible talks but believes the time for a thorough debate and a final decision is premature.