Chris Philp: Welcome to the Treasury Committee. Thank you for your time this morning. I would like to specifically talk about how, or whether, we might enter into an arrangement based partly or entirely on the EEA, and I would like to start by trying to elucidate some of the implications of that. Perhaps Professor Dougan would be a good place to start.
Professor Dougan, the assumption seems to have been made that membership of the EEA implies no restrictions to freedom of movement. Does that correspond to your understanding, particularly in light of Article 112 of the EEA agreement?
Professor Dougan: We should place free movement in the context of what the EEA covers and what it does not cover. The EEA is a very far‑reaching agreement. It covers all of the core treaty provisions and secondary legislation on the free movement of goods, persons, services and establishment. It covers competition law on state aids and public procurement. It also covers consumer protection, company law, environmental law and employment law. It covers various forms of co-operation, research and technological development, education and training, and so on.
Since the adoption of the EEA, over 7,000 pieces of EU law have been incorporated into the EEA agreement on top of the basic treaty provisions. It includes the working time directive and the free movement of citizenship directive. Many of the things that have been so controversial in a lot of the debate preceding the referendum are part of the EEA, just like they are part of EU law.
It does not cover things like the Common Agricultural Policy. There are no payments to farmers in Norway, for example. It does not cover foreign policy or the euro, but it is a very far-reaching agreement.
When it comes to free movement of persons in particular, there is a funny legal situation with the EEA. I mentioned it before. The EEA provisions are based on the EU treaty as it stood in 1992. The EU treaty provisions on the free movement persons have evolved since 1992; we now have the free movement of citizens as well as the free movement of workers.
Crucially, however, directive 2004/38, which governs the free movement of all EU citizens, is part of the EEA agreement. There are one or two adaptations to that directive under the principles of free movement within the EEA, but the main exception applies to Liechtenstein. Liechtenstein has quite significant restrictions on the free movement of European nationals into Liechtenstein. It is not surprising given the nature, size and territorial aspects of Liechtenstein as a country.
I have heard the suggestion that Article 112 of the EEA agreement could provide the basis for somehow exempting the UK from its obligations if we join the EEA, as regards free movement. I will give my honest opinion about this.
Chris Philp: Or at least modifying them—not exempting them but modifying them.
Professor Dougan: Sure. To be honest, entering into international negotiations with 30‑odd countries for an agreement, when it is absolutely clear as day that full free movement of persons is an integral part of that agreement and must be respected in full, and then securing the national agreements and ratifications of 30‑odd countries, and then trying to rely on a provision that is intended for emergency use in exceptional situations relating to very specific criteria so as to fully—but even partially—exempt ourselves from those types of obligations, would do nothing for our international credibility, would do nothing for this country on the international stage. Article 112 is an emergency safeguard provision for highly specific situations. It comes with obligations as well as opportunities. The idea that we would use it to somehow exempt ourselves from the normal regime of free movement of persons, wholly or partially, that applies under the EEA is, to be cruel, an armchair lawyer’s argument.
Q129 Chris Philp: To be clear, the free movement provisions in the EEA relates to the free movement of citizens, not just to the free movement of workers.
Professor Dougan: The provisions in the EEA agreement itself relate to the free movement of workers, establishment and services. The EEA Joint Committee which is the body which absorbs European EU legislation into the EEA and makes it binding upon the EEA states, has absorbed the Citizenship Directive 2004/38 into the EEA.
There are certain grey areas that lawyers like me spend time playing around with. For example, there are certain rights that derive from the treaty provisions in the EU on citizenship that are not contained in the Citizenship Directive. They come directly from the EU treaty provisions on citizenship rather than from the directive on citizenship. It is not clear to anybody that those particular rights are part of the EEA obligations of the EEA states. To be honest ,they are very marginal. They only affect small numbers of people in very unusual situations. It is a very limited practical interest. In principle, Directive 2004/38 is binding on the EEA states as it is binding for the EU member states. We should not forget that Norway, as a result of that directive, has a number of EU migrants per capita that is higher than most of the EU member states, including the UK.
Raoul Ruparel: I am not sure if it is 112 or a following article that also allows, if this safeguarding measure is adopted, the rest of the EEA or EU to take retaliatory and rebalancing measures. If we did decide to activate it the possibility of reduction in access or other responses is also possible. It is more, in my understanding, to trigger a negotiation to try to find some agreement rather than something that can unilaterally stop free movement without any response. There would definitely be a retaliation.
