In February 2016, former UK Prime Minister David Cameron secured a renegotiated relationship between the UK and the EU. However, the UK’s subsequent decision to leave the EU means that these changes will not be implemented.

Cicero Elections’ initial overview of the reformed relationship, and how exactly these changes would have been implemented, can be read below.

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Renegotiation Hub

Following the conclusion of the European Council Summit on 18 and 19 February 2016, David Cameron secured a renegotiated relationship between the UK and the EU. Cicero Elections provides an in-depth contextualisation of the negotiated deal, as well as an analysis of how the changes will be implemented.

1: Economic Governance

Agreement Achieved

Recognition of multi-currency Union
Paragraph 1, Decision of the Heads of State
Prohibition of discrimination between Eurozone-ins and -outs. Legal acts regarding the functioning of the Eurozone must respect the Single Market and respect the competences of Eurozone-outs. Likewise, Eurozone-outs will not impede the Eurozone’s functioning – including closer integration.

Flexible prudential rules for Eurozone-outs
Paragraph 2, Decision of the Heads of State
Acknowledgement that Member States outside of the Eurozone could be afforded more flexibility in implementing prudential requirements than those within it.  Member States outside of the Banking Union also retain ultimate responsibility for the implementation of supervisory or resolution rules.

Clarifying budgetary responsibility for financial stability measures
Paragraph 3, Decision of Heads of State
Eurozone-outs will not have budgetary responsibility for emergency financial stability measures – i.e. bailouts – in Eurozone Member States, while Eurozone-outs hold sole responsibility for any such measures themselves. Additionally, where the EU’s general budget is utilised in financial stability emergency or crisis measures within the Eurozone, Eurozone-outs will be reimbursed by “appropriate mechanisms to… be established”.

Ensuring Eurozone-out participation in Eurogroup
Paragraph 5, Decision of Heads of State
Explicit assurance that Eurozone-outs can participate in the deliberations, albeit without a vote, of the Eurogroup.

Concern-raising powers for Eurozone-outs (‘emergency brake’)
Paragraph 6 (new), Decision of Heads of State
Any Member State may raise opposition to an issue that could discriminate against non-eurozone members. The Council will discuss the issue and seek to reach a solution.

How will it be enacted?

Council decision to be deposited with the UN as an international agreement and inserted into the Treaties at the time of their next revision.

In the interim, these Council decisions enter into force as an international agreement on the same day the UK Government informs the Council of its intention to remain in the EU. 

Specifically regarding flexible prudential rules for Eurozone-outs, secondary law may then be adapted in the future, for example on future legislation affecting prudential or resolution requirements.

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2: Competitiveness

Agreement Achieved

Decision of Head of State

Agreement that the relevant EU institutions and Member States will take concrete steps towards better regulation – lowering administrative burdens, compliance costs on economic operators (incl. SMEs) and repealing unnecessary legislation.

Annex IV Declaration of the Commission on a subsidiarity implementation mechanism and burden reduction mechanism 

The Commission will develop a mechanism to review EU legislation for compliance with subsidiarity and proportionality rules. The Parliament, Council and national Parliaments will feed into a priority list for review, and the Commission will report on progress annually to the Council and European Parliament. The Commission will propose a work programme in 2016.

Through the Better Regulation initiative’s ongoing Regulatory Fitness & Performance Programme (REFIT), the Commission will establish specific regulatory burden reduction targets at EU and national level – with a specific focus on targeting SMEs’ burdens. This will include an Annual Burden Survey. The Commission will report to the Council annually on progress towards these targets.

Confirms commitment to trade strategy of “Trade for All: Towards a more responsible trade and investment policy”.

How will it be enacted? 

Commission action as part of ongoing Better Regulation initiative.

Commission action as part of ongoing REFIT platform work. 

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3: Sovereignty

Agreement Achieved

‘Ever closer union’ clarity
Paragraph 1, Decision of Heads of State
Clarity that the Treaties’ reference to creating an ever closer union among the peoples of Europe does not refer to Union objectives of political integration. Additionally, it is clarified that the reference does not offer a basis for extending the scope of the Treaties or EU legislation – meaning the reference cannot be used by future court decisions.

‘Red card’ system
Paragraphs 2-3, Decision of Heads of State
Introduction of a ‘red card’ system allowing groups of national parliaments to collectively object to draft legislative acts. The mechanism would require 55% of national parliaments to submit to the Council objections to how the draft legislation fails to comply with subsidiarity rules within 12 weeks of the draft’s publication. The Council would then be required to discuss the concerns and, failing to amend the draft legislation to accommodate the concerns, halt the act.

Schengen and Freedom, Security and Justice (Protocol No 20/21)
Paragraphs 4-5, Decision of Head of State
Explicitly recognises the UK is not bound by Protocol No. 20 and has an opt-out in its participation in the Schengen areas as regards internal and external borders. It also have the right to choose whether or not to participate in measure in the freedom, security and justice (Protocol 21).

How will it be enacted?

Council decision to be deposited with the UN as an international agreement – entering into force the same day the UK Government informs the Council of its intention to remain in the EU.

Specifically regarding the ‘ever closer union’, the clarifications will be inserted into the Treaties at the time of their next revision.

4: Social Benefits and Freedom of Movement

Agreement achieved

Limit access to in-work benefits for EU migrants
Paragraph 2(b), Section D, Decision of the Heads of State and Commission declaration on the Safeguard Mechanism
Through a combination of clarity around the interpretation of existing EU rules and changes to EU legislation, recent EU migrants can be restricted from accessing in-work benefits for four years. This will last for seven years. The exclusion could be enacted by a Member State notifying the Commission and Council that freedom of movement threatens a public interest, such as the sustainable provision of social security systems. The actual exclusion would then be enacted by the Council through an implementing act, after the Commission examines the notification and proposes the exclusion to the Council. Despite the headline four year limit however, the exclusion is gradually reduced over the four year period to reflect the increased integration into the labour market of the migrant.

Restrictions on EU migrant access to child benefits
Paragraph 2(a), Section D, Decision of the Heads of State
Ability to index child benefit payments to match the standard of living of the Member State in which the child resides. Initially this will only apply to new arrivals but from 1 January 2020, may apply to all workers.

Restrictions on freedom of movement rights of third national spouses
Paragraph 1(c), Section D, Decision of the Heads of State and Commission declaration on the abuse of the right of free movement of persons
Clarity on the interpretation of current EU rules to allow Member States to take action against nationals from third countries regularising unlawful stay through marriages of convenience with EU nationals. Additionally, a legislative complement to Directive 2004/38 on free movement will be proposed to restrict freedom of movement rights for the spouses of EU citizens.

Clarity on ability to address public threats
Paragraph 1(c), Section D, Decision of the Heads of State and Commission declaration on the abuse of the right of free movement of persons
Clarity on the interpretation of current EU rules to allow Member States to take preventative action against public policy or security threats posed by individuals. Member States are additionally able to take into account past conduct of the individual, even in the absence of a previous criminal conviction. The Commission additionally commits to re-examine the thresholds for defining “serious grounds of public policy or public security” and “imperative grounds of public security” in future revisions of the Directive 2004/38 on freedom of movement.

How will it be enacted? 

Amendment to Regulation (EC) No 492/2011 on freedom of movement for workers within the Union is required to insert an alert and safeguard mechanism to respond to a marked increase in migration.  The Council declaration itself – to be deposited with the UN as an international agreement – clarifies related restrictions to freedom of movement available to Member States, including the ability to restrict freedom of movement based on overriding public interest.

 

 

 

 

Amendment to Regulation 883/2004 on the coordination of social security systems by the co-decision process.

 

 

The Commission will adopt a co-decision proposal to complement Directive 2004/38 on freedom of movement.The Council declaration itself – to be deposited with the UN as an international agreement – clarifies available Member State actions against marriages of convenience.

 

 

 

Council decision to be deposited with the UN as an international agreement – entering into force the same day the UK Government informs the Council of its intention to remain in the EU. Any future revision of Directive 2004/38 on the freedom of movement must include a re-examination of thresholds for definitions related to these clarifications.

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