Swiss upper house backs EU package while tightening immigration rules

After roughly 24 hours of debate, the Council of States has given Bilaterals III a broad political endorsement, while adding conditions that could reshape the next stage of the deal. Switzerland’s upper house accepted most of the package designed to stabilise the country’s access to the European Union’s single market. It also demanded a mandatory referendum and adopted tougher immigration provisions than those supported by the Federal Council.

The decision keeps Switzerland’s long-running bilateral strategy on track. Bern is seeking clearer arrangements for updating market-access agreements, resolving disputes and supervising state aid after the collapse of an earlier institutional framework agreement in 2021. The new package addresses those concerns while preserving Switzerland’s position outside the EU and the European Economic Area.

The vote does not complete the parliamentary process. The National Council, Parliament’s larger chamber, will examine the package during the winter session. The electricity agreement, one of the most consequential parts of the negotiations, was left out of this week’s proceedings. The Council of States is due to begin examining it in December.

That timetable leaves room for further amendments. It also ensures that the most politically sensitive issues, including immigration, referendum procedure and the financial contribution to European cohesion, will remain central to the national debate.

The Council of States wants voters and the cantons to decide the final agreement through a mandatory referendum. That position directly challenges the Federal Council’s preference for an optional referendum, which would require only a majority of votes cast across Switzerland.

Under the upper house proposal, Bilaterals III would need two approvals: a majority of the Swiss electorate and a majority of the cantons. The chamber backed both legislation containing that requirement and a separate constitutional amendment. The double-majority rule reflects the country’s federal structure and gives smaller cantons a decisive role in the outcome.

The referendum question matters because the package reaches well beyond a single technical agreement. It would govern Switzerland’s future relationship with the EU across market access, migration, electricity, state aid and cohesion funding. A mandatory vote would give the agreement a clear democratic test, while also creating a higher hurdle for ratification.

The National Council could modify the arrangement before the process ends. Parliament must also reconcile the constitutional amendment with the implementing legislation. If both chambers ultimately agree, the Federal Council would then have to prepare the package for a nationwide campaign and vote. The timing will depend on the remaining parliamentary debates and any referendum procedures that follow.

The upper house approved CHF 3.3 billion in commitment credits for Switzerland’s future contribution to European cohesion. Payments would take place between 2030 and 2036 if the wider package enters into force.

The largest allocation, CHF 2 billion, would target economic and social disparities. A further CHF 273.4 million would finance migration-related projects, while roughly CHF 1 billion would be assigned as an additional one-off commitment. The amounts form part of the political bargain surrounding Switzerland’s relationship with the EU and its participation in a more stable bilateral framework.

The package also preserves the central elements of the compromise on wage protection reached by the Federal Council, the social partners and Brussels. The existing requirement for foreign companies posting workers to Switzerland to provide a security deposit would disappear for firms without a record of non-compliance. Authorities could still demand a deposit from a company that had previously failed to meet its obligations.

Senators also supported an accompanying measure intended to strengthen protection against dismissal. These decisions show where the upper house accepted negotiated arrangements with the EU. The financial commitments and wage rules will now face scrutiny in the National Council, where lawmakers may seek changes to both the sums and the safeguards.

Immigration produced the sharpest conflict between the Council of States and the Federal Council. Under the negotiated safeguard clause, Switzerland could take protective measures if EU immigration caused “serious economic or social problems”. Senators backed an immigration levy as one possible response, with the Federal Council expected to apply specified thresholds when assessing whether the safeguard conditions had been met.

The chamber also voted to require people arriving from the EU to provide information from their criminal records during the admission process. That measure would add a new administrative condition to the movement of people between Switzerland and the EU.

The most contested decision concerns permanent residence. The package foresees partial adoption of the EU Citizens’ Rights Directive and a new permanent-residence status. The Council of States voted to prevent unemployed EU nationals and people receiving social assistance from applying. Their five-year qualifying period would restart.

The Federal Council argued that a blanket exclusion of welfare recipients would conflict with the agreement on the free movement of people. That warning sets up a major dispute in the National Council. Parliament must decide how far Switzerland can tighten domestic rules without undermining the legal commitments negotiated with Brussels. The issue is likely to draw attention from employers, trade unions, municipalities and migrant communities.

The National Council now holds the next decisive vote on a package that touches nearly every major channel of Swiss and EU cooperation. Lawmakers will review the upper house’s decisions during the winter session, including the referendum route, immigration controls, cohesion credits, wage protection and the new state-aid oversight system.

The state-aid legislation would create a Swiss body to monitor subsidies and other government support in sectors covered by the bilateral agreements. Its purpose is to prevent public assistance from distorting competition. The rules would apply in areas including land transport and electricity, although the source account does not provide the full details of the proposed framework.

The electricity agreement will receive separate attention in December. Its exclusion from the first examination means that Parliament has not yet considered one of the package’s most important components. The debate could affect the political balance of the entire agreement, particularly for cantons and businesses focused on energy security and cross-border market access.

Switzerland’s bilateral relationship with the EU has developed through agreements since voters rejected European Economic Area membership in 1992. Bilaterals III seeks to make that model more workable as EU law evolves. The next parliamentary votes will determine whether the package moves forward as negotiated or reaches the public after further Swiss conditions are added.