Business warning over EU pullout


EU and UK flagsBritain's leading business organisation has warned that a Norwegian or Swiss-style relationship with the European Union would not be better than full membership for the UK.

With MPs debating a Bill to enshrine an in/out EU referendum in law, some advocates of withdrawal have held up Norway and Switzerland as models for a future for Britain outside the 28-nation bloc.

But in a report, the Confederation of British Industry warned that the "halfway house" positions followed by the two states "are not easy options that simply allow a country to gain the advantages of membership while removing the disadvantages".

"The CBI rejects the premise that these models would be better options for the UK," said the report.
Neither Norway nor Switzerland are members of the EU, but both enjoy varying degrees of access to the single market. Norway is a part of the single market through its membership of the European Economic Area (EEA), while Switzerland has negotiated a free trade deal and more than 120 bilateral agreements with the EU.

But after interviews with a wide range of Norwegian and Swiss businesses, politicians and other stakeholders, the CBI concluded that both found themselves in the position of having to comply with swathes of EU laws and standards without having the power to influence the way they are framed.

Norwegian firms were placed at a "competitive disadvantage" because they operate in a more uncertain regulatory framework than EU counterparts, but Oslo was unable to take advantage of its hoped-for trade flexibility, as international negotiators preferred to conclude deals with the EU first, said the report.

Meanwhile, Switzerland tends to introduce measures domestically to match those of the EU in order to ensure its companies have access to the single market. Negotiating bilateral trade agreements has been "complex and time-consuming", with one important set of deals taking almost a decade to be finalised and enter into force.

The CBI quoted Norwegian Conservative Party spokesman Nikolai Astrup MP advising Britain: "If you want to run the EU, stay in the EU. If you want to be run by the EU, feel free to join us in the EEA."

The report concluded: "It is clear that neither the Norwegians nor Swiss have developed an associate membership that is satisfactory to both Brussels and the country in question. The CBI rejects the notion that these models would be better for the UK, arguing that British businesses don't want to find themselves at the margins of the world's largest trading bloc operating under market rules over which they have no influence."

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