Financial Contribution (Institutional)

Source: Dispatch of the Federal Council on Bilateral III, pp. 118--119
PDF of the dispatch

¶ Summary

Under the single market agreements, Switzerland participates financially in EU agencies, information systems and activities. The funding consists of an operational contribution and a participation fee. The contribution key is based on the ratio of Swiss GDP to EU GDP. The participation conditions are reviewed every three years by the Joint Committee (JC).

¶ Structure of financial participation

¶ Two components

Component	Description	Calculation
Operational contribution	Funding of the ongoing activities of agencies and information systems	GDP key (Swiss GDP / EU GDP)
Participation fee	Lump-sum contribution for participation in activities and programmes	Agreed in the JC

¶ GDP contribution key

The calculation of Switzerland's contribution follows a transparent key:

Basis: Ratio of Swiss gross domestic product (GDP) to the GDP of EU Member States
Updating: Annual, based on the most recent available GDP data
Transparency: The key is laid down in the agreements and is traceable

Order of magnitude: Swiss GDP accounts for approximately 4--5% of EU GDP, which reflects the approximate framework of the contribution key.

¶ Participation in EU agencies

Switzerland participates under the single market agreements in various EU agencies:

Area	Agency/System	Agreement
Air transport	European Union Aviation Safety Agency (EASA)	AAT
Conformity	Relevant EU bodies for conformity assessment	MRA
Free movement	EURES network (job placement)	AFMP
Land transport	European Union Agency for Railways (ERA)	ALT

¶ Review and adjustment

¶ Three-year cycle

The Joint Committee (JC) reviews the participation conditions and partial contributions every three years:

Scope of participation: Are all activities still being used?
Adequacy of contributions: Does the contribution correspond to the actual benefit?
New activities: Should Switzerland participate in new programmes or agencies?

¶ Protection of existing arrangements

An important negotiating success for Switzerland:

Switzerland's financial contributions to agencies are not adjusted at Switzerland's request, as long as the existing arrangements are in force. Current arrangements are not affected by the new institutional provisions.

¶ Distinction from the cohesion contribution

The financial contribution under the institutional elements must not be confused with the cohesion contribution (solidarity contribution) to the newer EU Member States:

Aspect	Institutional financial contribution	Cohesion contribution
Purpose	Participation in agencies and activities	Reduction of economic disparities
Legal basis	Single market agreements	Separate agreement
Calculation	GDP key	Politically negotiated
Recipients	EU agencies, programmes	EU Member States (primarily CEE)
Periodicity	Ongoing	In periods (e.g. 10 years)

¶ Key points

Two components: Operational contribution + participation fee
GDP key: Transparent and traceable calculation
Three-year review: Regular adjustment by the JC
Protection of existing arrangements: Current arrangements are not affected
No confusion with the cohesion contribution