On 21 June 1999, the European Union and Switzerland signed the Agreement on the Free Movement of Persons (AFMP). The AFMP and its additional Protocol lift restrictions on EU citizens wishing to live or work in Switzerland. The right of free movement is complemented by the mutual recognition of professional qualifications, by the right to buy property, and by the coordination of social insurance systems. The same rules also apply to citizens of EFTA member states.
On 1 June 2002, the AFMP came into force for citizens of the "old" EU member states (EU-15) as well as for citizens of EFTA member states. As a result of EU eastern enlargement on the 1 May 2004, the AFMP was supplemented on 1 April 2006 by an additional protocol containing provisions for the gradual introduction of the free movement of persons for ten new EU member states (EU-8; Cyprus and Malta have enjoyed the same conditions as the "old" 15 EU member states from the very beginning, hence the term EU-17). In a referendum held on 8 February 2009, the Swiss electorate approved the continuation of the AFMP after 2009 and Protocol II on extension of the Agreement to Romania and Bulgaria (EU-2). Protocol II came into force on 1 June 2009.
Citizens of the "old" EU member states, including Cyprus and Malta (EU-17), and citizens of EFTA member states have enjoyed free movement rights since 1 June 2007. Citizens of EU-8 member states were granted the same unrestricted free movement rights on 1 May 2011 and Citizens of Bulgaria and Romania (EU-2) have enjoyed the same rights since 1 June 2016.
Croatia joined the European Union (EU) on 1 July 2013. Croatia’s accession does not have any immediate bearing on the AFMP concluded between Switzerland and the EU. Each time a new member joins the EU, the Agreement is supplemented by an additional protocol. Since 1 July 2014, Switzerland applies separate quotas to Croatian nationals; access to the Swiss labour market will remain subject to the provisions of the Foreign Nationals Act (FNA).
Extension of the AFMP to Croatia was initially negotiated in Protocol III. After the Swiss electorate adopted a popular initiative aimed at stopping mass immigration, the Federal Council was no longer in a position to sign Protocol III in its original version because it violates the new constitutional provisions. Since February 2015, the Federal Council has managed to work with its EU partners to establish a new basis on which to move forward: both Switzerland and the EU agree that they should strive for a mutually amenable solution based on a common interpretation of the existing safeguard clause (Art. 14.2 AFMP).
With this new basis, the Federal Council signed Protocol III and the corresponding Federal Council Dispatch on 4 March 2016. It now intends to submit Protocol III to the Swiss Parliament for ratification (i.e. legally binding enactment), which should occur if a solution has been found that is compatible with the AFMP.
There are two reasons why signature of Protocol III and parliamentary scrutiny are important: first, doing so lays the foundation for Croatian nationals to enjoy the same privileges as citizens of other EU member states; second, it is an important step for full-fledged membership of Switzerland in the new research framework programme Horizon 2020.