Service Liberalization between the EU and Switzerland under the AFMP: Assessing the Silver Jubilee of a Complex Relationship

EU-Switzerland economic and political relations have become strained recently, particularly after the failed negotiations for an institutional ‘umbrella’ agreement in May 2021. Switzerland only partially participates in the EU internal market, adopting a unique, autonomous approach to EU law alignment. This has caused tensions as Swiss elites call for flexibility, while European forces seek uniformity with other neighboring countries. The liberalization of trade in services is a key issue needing urgent agreement, given both parties’ heavy reliance on their services industries and their long-standing trade relationship. This article reviews the existing framework for bilateral trade in services, examining the Agreement on the Free Movement of Persons (AFMP), pertinent provisions, interpretation issues, and relevant case-law. It also discusses the impact of the ‘Swiss exception’ on the EU internal market, highlighting the complexities of the economic cooperation that are expected to grow in the aftermath of the agreement reached between the two trading partners in December 2024.