Swiss President Doris Leuthard accused the European Union of trying to undermine Switzerland as a financial centre by granting its stock exchanges only limited access to the EU single market and said Bern would ready retaliatory measures. Her harsh comments on Thursday followed warnings that Bern would strike back if the EU did not give Swiss exchanges the same regulatory status as those in other countries, exacerbating a row over the future of bilateral ties.
EU member states agreed on Wednesday to grant Swiss exchanges only one year of access, part of a broader deal aimed at defining Bern's ties with the bloc. "Switzerland fulfils the conditions for recognition of stock market equivalence every bit as much as the other third countries that have been granted indefinite recognition," Leuthard told reporters.
"Switzerland therefore considers this limited recognition to be a clear case of discrimination. Linking this technical dossier with institutional issues is extraneous and unacceptable." The Swiss finance ministry would propose steps by the end of January that could include halting collection of stamp duty on transactions to make Swiss exchanges more attractive.
The government would also review its plan, announced when European Commission President Jean-Claude Juncker met Leuthard last month, to contribute an extra 1.3 billion Swiss francs ($1.32 billion) in development funds for newer EU members. The EU's recognising share trading on the SIX Swiss Exchange and BX Swiss as equivalent to exchanges based in the EU and vice-versa will avoid disruption after new MiFID II market rules come into force in January.
But by allowing Swiss exchanges only temporary access to the single market, Brussels is turning up the pressure on Switzerland to agree on a new treaty that would replace a patchwork of bilateral accords that now govern ties. The project has hit obstacles as conservative parties baulk at giving the European Court of Justice a say in settling disputes over EU laws that neutral Switzerland would have to adopt as the price of enhanced access to the single market.
Leuthard noted that the Swiss government had made it an objective to continue negotiations on a treaty in 2018. "It also recognises that significant differences still exist. A prerequisite for overcoming these differences is the willingness of both parties to hold objective discussions in an atmosphere of trust," she said.
Bilateral ties suffered when Swiss voters in 2014 demanded quotas on EU immigration, then thawed after parliament a year ago adopted a system giving people registered as unemployed in Switzerland first crack at open jobs. The row over stock exchanges now threatens to set ties back again.
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