Swiss-EU power talks on hold after immigration vote

Mon Feb 10, 2014 1:29pm EST

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BRUSSELS, Feb 10 (Reuters) - The European Commission has stopped talks with Switzerland on a cross-border electricity agreement, a spokeswoman for the EU executive said on Monday, following the country's referendum vote to curtail immigration.

The Commission has been seeking closer power trading ties with Switzerland to complement a common energy market for the 28-strong European Union, which it has a deadline to complete this year.

But it said that talks with Bern about a scheme to make it easier to trade energy could not continue without wider political clarity.

"No technical negotiations on the electricity agreement between Switzerland and the EU are foreseen for the moment," Commission spokeswoman Sabine Berger said. "The way forward needs to be analysed in view of the broader context of the bilateral relations."

Separately, senior European officials said Switzerland could lose its privileged access to the European single market in general following the narrow vote in the referendum on Sunday.

Free movement of people and jobs within its borders is one of the fundamental policies of the EU, and Switzerland, while not a member of the bloc, has participated under a pact with Brussels.

Late last year, EU Energy Commissioner Guenther Oettinger had said the Commission was in intense negotiations with Switzerland to integrate it into the bloc's single energy market.

Swiss participation is important for extending the common energy market for countries such as Italy, which border Switzerland.

Even if the regulations on a single market can be hammered out, the European Union still has a huge task ahead to create all the necessary infrastructure for a single energy area.

The Commission has succeeded in encouraging a process called market-coupling, which links together electricity exchanges and standardises trading rules. (Reporting by Barbara Lewis; Editing by Anthony Barker)

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