Swiss ties with the European Union, its biggest trading partner, face a critical test this week as Brussels decides whether the two sides have made enough progress on a stalled draft treaty to head off punitive measures set to start at the end of June. After more than four years of negotiations produced a draft text in November, the Swiss government this month tentatively endorsed the accord but said it needed clarifications on three areas - protecting Swiss wages, regulating state aid, and spelling out citizens' rights - before it could sign off.
European Commission President Jean-Claude Juncker - whose term ends on October 31 - responded that he was prepared to clear up any questions but wanted this done by Tuesday, when the Commission reviews relations with Switzerland. The Commission's main leverage is its recognition of Swiss stock exchanges as equivalent to EU bourses, which allows them to access the bloc's single market and which is due to expire at the end of June.
Finding language to address Swiss concerns on state aid and the rights of EU citizens living in Switzerland - but without reopening the draft accord for renegotiation - does not look insurmountable, people close to the situation say.
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