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Swiss Government Urges Parliament to Reject Initiative Opposing EU Deal

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The Swiss government on Thursday urged parliament to reject an initiative that seeks to block a new agreement with the European Union, describing it as a threat to legal and economic stability. The deal, agreed in December 2024, would represent the biggest overhaul of Switzerland’s bilateral economic relations with the EU in a generation.

Known as the “Kompass-Initiative,” the proposal is backed by the billionaire founders of Swiss asset manager and private equity firm Partners Group. It seeks to expand the use of compulsory referendums for international treaties, requiring approval from both Swiss voters and a majority of the country’s 26 cantons.

The government warned that the initiative could create legal uncertainty and disrupt Switzerland’s established democratic system. It also opposes provisions in the EU-Swiss agreement allowing Switzerland to align certain laws with future EU legislation while maintaining constitutional safeguards. The initiative is expected to go to a referendum after gathering sufficient signatures, though no date has been set.

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EU-Mercosur Trade Deal Set for Provisional Start Despite Legal Challenge

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The European Union’s long-awaited free trade agreement with Mercosur countries is likely to be applied provisionally from as early as March, according to an EU diplomat. The move could go ahead once the first Mercosur nation ratifies the pact, with Paraguay expected to do so in the coming weeks, allowing parts of the deal to take effect despite ongoing political and legal hurdles within the EU.

Momentum behind the agreement has been complicated by EU lawmakers referring the deal to the European Court of Justice, a step that could delay full implementation by up to two years. The referral has disappointed several EU governments and businesses, particularly in Germany, where the deal is strongly supported as a driver of growth. German Chancellor Friedrich Merz criticised the move, stressing that the agreement remains essential for Europe’s economic future.

Signed after 25 years of negotiations, the EU-Mercosur pact is the bloc’s largest trade deal to date and is seen by supporters as a way to offset losses from U.S. tariffs and reduce dependence on China. However, opposition remains strong, led by France and farming groups, who warn that increased imports of South American agricultural products could undermine European farmers and disrupt local markets.

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