18 July 2018
On 12 July the UK Government published its White Paper on the Future Relationship between the UK and the EU. For an overview of the proposals and some of the key issues for Wales see our previous blog post.
For the new relationship between the UK and the EU to work, the White Paper states that new joint institutional arrangements will be needed and suggests that these arrangements could take the form on an Association Agreement. There are several Association Agreements currently in place between the EU and third countries. This blog will explore what is an Association Agreement, why the EU seeks these agreements and what agreements currently exist.
What is an Association Agreement?
An Association Agreement is a bilateral agreement between the EU and a third (non-EU) country that creates a framework for cooperation. The legal basis for an Association Agreement, as defined in Article 217 of the Treaty of the Functioning of the EU, provides for “an association involving reciprocal rights and obligations, common action and special procedures”.
According to the Institute for Government, the EU uses Association Agreements to create “privileged links” with non-member countries. The UK Government will therefore hope to see the EU using an Association Agreement to set up a Free Trade Area for goods, create a new security partnership and provide for cooperative accords in areas such as science and innovation, culture and education, and space, amongst other things.
During a meeting of the External Affairs and Additional Legislation Committee (EAAL) in January 2018, Dr Tobias Lock from the University of Edinburgh described an Association Agreement as something “in-between” the ‘Norway option’ (membership of the European Economic Area) and the ‘Canada option’ (a comprehensive economic and trade agreement negotiated chapter by chapter). This point is also made clear in the graphic presented by Michel Barnier to the Heads of State and Government at the European Council on 15 December 2017, which uses Ukraine an example of the relationship a third country can have with the EU under an Association Agreement.
What Association Agreements currently exist?
The EU currently has more than 20 Association Agreements, including:
- with members of the Eastern Partnership (Georgia, Moldova and Ukraine);
- with members of the Euro- Mediterranean partnership (Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, Palestine, Tunisia and Turkey);
- Stabilisation and Association Agreements with the Western Balkan Countries (Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro and Serbia); and
- the EU-Central America Association Agreement (incorporating Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama).
Why does the EU seek Association Agreements?
Not all Association Agreements serve the same purpose, as there are several reasons why the EU may seek an Association Agreement with a third country.
Association Agreements were originally created by the EU to prepare non-member countries for accession. In the context of accession to the EU and the process of EU enlargement, Association Agreements serve as the basis for implementation of the accession process. Association agreements for this purpose currently exist with the Western Balkan Countries and Turkey.
More recently, the EU has used Association Agreements for a wider set of purposes, including to develop deeper long-term political and economic relations with third countries which are not candidates of accession to the EU, for example the Ukraine-EU Association Agreement.
Furthermore, Association Agreements are also used to improve trade with non-member countries with no ambition of accession to the EU now or in the future. These counties need not be part of the European Neighbourhood Policy or located within close geographical proximity to the EU. For example, the EU is currently negotiating a bi-regional trade deal with the four founding Mercosur states – Argentina, Brazil Paraguay and Uruguay – as part of a broader Association Agreement between the two regions. The European Commission hopes this Association Agreement will achieve a reduction in tariffs on manufactured goods produced in EU Member States exported to the Mercosur states, as well as a reduction in non-tariff barriers through the simplification of the customs procedures and closer alignment of technical regulations and standards.
What happens next?
The EU is yet to formally responsd to the UK Government’s proposals. However, when Guy Verhofstadt, the European Parliament’s Brexit coordinator gave evidence to the House of Commons Exiting the EU Committee on 20 June he stated that the European Parliament’s preferred model for a future partnership is for the UK and EU to sign an Association Agreement:
We [the European Parliament] think it has to be an association agreement that is foreseen in our treaties in Articles 8 and 217. On the one hand, that gives an enormous flexibility, because an association agreement can be very narrow; you can limit yourself only to trade, for example. In an association agreement you can be very broad. You can also put cooperation on foreign and security policy in it. It is flexible and precise at the same time, because you are going to create one governance structure and you are going to create not only one governance structure but also one cycle of ratification.
According to Mr Verhofstadt
The advantage of an association agreement is that once it is approved by your side and by the European institutions, the Council and Parliament, it is applicable in advance; you do not need to wait for ratification by the other 27 member states, which can take some time.
Nevertheless, as stated in the White Paper, ‘the legal base that would need to be cited under the EU Treaties would be for the EU to determine’ and the details of the agreement would subject to the negotiation with the EU. Mr Verhofstadt previously described the proposal of an Association Agreement as an attempt to ‘create a bridge’ between the red lines of the UK Government and the principles of the European Union. It remains to be seen how the EU will respond to the UK Government’s proposals and whether they bridge the positions and interests of both parties.
Article by Manon George, National Assembly for Wales Research Service