Sarkozy wins back party leadership, but road to French presidential election remains very long

Nicolas Sarkozy took a further step on the road to his political comeback over the weekend, as he won back the leadership of France’s centre-right UMP party. The former French President secured 64.5% of votes in an online survey of UMP members, finishing well ahead of former Agriculture Minister Bruno Le Maire (29.2%) and outsider Hervé Mariton (6.3%).

Sarkozy was always going to win, but the outcome is most certainly below what he was hoping for. In 2004, he had sailed through the leadership election with over 85% of the vote. Still, he holds again the reins of his “political family” – to use his own words – and has already made at least two interesting announcements:

• The UMP will change name before the next round of local elections in March 2015. 

• He will set up a committee of former UMP prime ministers to help him manage the party – although the idea has reportedly not gone down particularly well with François Fillon, one of the former prime ministers supposed to sit on this committee. 

On this blog, we have noted how Sarkozy’s political comeback has the potential to really spice up the French debate over Europe. The former French President has this year repeatedly spoken of returning half of the EU’s powers to national governments. He also wants to scrap the EU’s passport-free Schengen travel area in its current form and replace it with a more selective ‘Schengen II’, which could only be joined by countries adopting the same immigration policies.

Sarkozy’s political strategy looks pretty clear: take a tougher, more ‘realist’ stance on Europe and immigration to stop the UMP losing voters to Marine Le Pen’s Front National. What is far from clear at this stage, though, is whether the new line will draw unanimous support from the rest of Sarkozy’s party.

Another important point to keep in mind is that the victory in Saturday’s party leadership poll does not automatically make Sarkozy the centre-right candidate for the 2017 French presidential election. A separate ‘primary election’ is due in 2016, when Sarkozy is going to face at least one much tougher rival: former French Foreign Minister Alain Juppé.

How that duel will end is anyone’s guess, but recent opinion polls suggest that Juppé would have a better chance of victory in case of an ‘open primary’ – where members of smaller centrist parties can vote alongside with UMP members to elect a single centre-right presidential candidate. Sarkozy has so far spoken in favour of an ‘open primary’, although he looks reluctant to involve the Democratic Movement (MoDem) in the exercise. The centrist party led by François Bayrou actually endorsed François Hollande in the run-off of the 2012 presidential election against Sarkozy, and Bayrou has made no secret of his support for Juppé as the centre-right candidate in 2017.

Finally, Sarkozy remains (directly or indirectly) involved in a series of pending legal cases that may well dog his campaign.

The road to 2017 is still very long. 

French public opinion and Europe: Winds of change?

With the European Parliament elections approaching, the number of EU-related opinion polls is growing. Beyond the mere voting intentions, these surveys help get a clearer picture of how citizens see Europe in various countries.

Two separate opinion polls published in France over the past few days caught our attention. Just in case you don't read our press summary every day - France is a particularly interesting case, given that the anti-EU Front National may well win the most votes in the upcoming European Parliament elections.

The first poll, conducted by IFOP and published by French news site Atlantico over the weekend, found that 59% of French would be in favour of France "reconsidering the Schengen agreements [which created a passport-free travel zone in Europe] and restraining the conditions for the circulation and the establishment of European citizens on its territory."

A separate OpinionWay poll for Le Figaro and LCI found that, while a solid majority of French want to keep the euro, the number of those against a return to the franc dropped from 62% to 53% since April 2012. Also, the share of respondents who think EU membership is "a good thing" for France went down from 48% to 42% over the same period - again, still a relative majority.  

Interestingly, one of the questions in the poll was, "Which one of these feelings comes to mind when you think of the EU?" Well, 45% said 'disappointment', 18% 'hope' and 12% 'indifference'.

It would be exaggerated to claim that the French are turning their back on the EU, but the winds do seem to be changing somewhat, and the French electorate seems to be shifting towards a less idealistic approach to the 'Europe' issue. Looking at the bigger picture, this also highlights that, without sweeping reform of the EU, the risk is that voters will increasingly turn to anti-EU and anti-immigration parties - and potentially throw the baby out with the bathwater.

An increasing number of politicians across Europe have realised this, including in France. Rachida Dati, a French MEP from the centre-right UMP party, told our pan-European EU Reform Conference last month that the "disregard" of the EU elite for the citizens had to stop, adding that "it is the peoples that must impose their will to Brussels and not the other way around".

An independent Scotland's forthcoming EU negotiations

The SNP has today published its White Paper on an independent Scotland. Amongst its other analysis it sets out a strategy towards the EU. It has always been clear that if Scotland votes for independence there will need to be a negotiation with the rest of the UK on the terms for divorce, but it is now clear the SNP have an EU negotiating agenda too. Here are the main points:

Firstly, the SNP assume Scotland will remain in the EU and have a smooth transition from corporate UK membership to individual membership. They argue that "discussions [on EU accession] will be held during the period in which Scotland remains part of the UK". These discussions will have to take in the following points:

• A Schengen opt-out: The SNP says it  would "plan to continue in the current Common Travel Area" with the rest of the UK.  As signing up to the Schengen travel area is incompatible with the UK/Ireland CTA and Schengen is a part of the EU treaties this will need a negotiation.
• A Scottish EU Budget rebate: The UK is a net contributor to the EU budget, but would contribute even more if it had not secured a UK rebate. The SNP recognise that "Scotland is likely to be a net financial contributor to the EU" but state they wish to have their own rebate saying they "consider that the division of the share of the UK rebate would be a matter for negotiation". This would obviously be a difficult negotiation as it was for Mrs Thatcher at Fontainebleau.
• A Euro opt-out: The SNP state that it is "our intention to retain Sterling as the currency of an independent Scotland". As well as discussions with the rest of the UK, Scotland will ideally need to gain a permanent opt-out from the Euro. The UK and Denmark are the only two states to have such a permanent opt-out but the SNP argue that the case of Sweden (which is meant to join but shows no signs of joining) shows that the EU can be flexible.
• A Justice and Home Affairs opt-in: The UK has a special deal whereby it can chose to opt in to new JHA (justice and home affairs) measures on a case-by-case basis. The SNP have said that they "will seek to retain the current flexibility to opt into new measures on Justice and Home Affairs" meaning they will ask for their own ability to opt in.

So in an independent Scotland's EU accession negotiations, the SNP will be asking for a number of special conditions already afforded to the UK. Firstly they would like their application to be considered while they remain a part of the UK, something they will also need UK approval for. They will then be asking for opt-outs from Schengen, the Euro, a JHA opt-in and perhaps most controversially a Scottish rebate.

Will the EU be a big deal in the Scottish referendum? The SNP seem to think it might be and are keen to defend themselves from accusations they might inadvertently leave the EU. Indeed they argue that “if we remain part of the UK, a referendum on future British membership of the EU could see Scotland taken out of the EU against the wishes of the people of Scotland.”

It is often thought that Scotland is less 'eurosceptic' than the rest of the UK. But is this true? One YouGov poll for instance suggests that 31% of Scots would vote to leave the EU against the UK average of 34% and that 55% would vote to stay in if David Cameron renegotiated and recommended a new deal the same as the UK average. Perhaps the SNP feel that if they were left inside the EU without a 'Scottish' rebate and their own version of the UK's existing opt-outs they might see a challenge from a tartan version of UKIP?

So at a time when disillusion with the EU is growing in the UK, the SNP is, like the UK parties, keen to demonstrate they will not be ceding more (Scottish) power or money to the EU. They even accept that there are, as in the UK at large, some Scots "arguing for a looser form of partnership" with the EU.

Between a rock and a hard place: Is Spain breaching EU law by making life difficult for Gibraltarians?

The 'Gibraltar question' has consistently been the biggest bone of contention in UK-Spanish relations ever since the 1713 Treaty of Utrecht which saw the territory permanently ceded to Britain. Although the issue never goes away, every now and then it flares up, and the decision by the Gibraltar authorities to construct an artificial reef - to prevent alleged incursions from Spanish fishing vessels - has been the latest trigger.

The Spanish authorities do have the scope to make life difficult for the Rock's inhabitants, and Spanish Foreign Minister García-Margallo has commented that this time, "the party is over". Madrid has already introduced stringent border checks on people travelling in and out of the territory - resulting in up to seven hour queues on the border (in stifling heat) - and further actions have been threatened, including €50 levy on cars entering and leaving the territory, as well as a tax crackdown on Gibraltarians who live on the Spanish side of the border.

Leaving aside the question of whether this is even in Spain's own interest given its own economic problems (thousands of Spanish citizens work in Gibraltar), are these types of measures - particularly the levy - even permitted under EU free movement rules? EU law prohibits discrimination against citizens of other member states when it comes to free movement, and the UK has indicated it could issue a legal challenge.

So does the UK have a good case? Article 45 of the EU Treaties which establish the principle of free movement states that:

2. Such freedom of movement shall entail the abolition of any discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment. 

3. It shall entail the right, subject to limitations justified on grounds of public policy, public security or public health: 
(a) to accept offers of employment actually made; 
(b) to move freely within the territory of Member States for this purpose; 

Discrimination is clearly prohibited for the purposes of employment, as is the ability to "move freely" within member states for this purpose, although exemptions for "public policy" and "public security" are quite vague. However, the right to free movement covers the right to live and work in another member state, it does not address the more specific issue of travelling between two member states for this purpose.

The UK and/or the Gibralterian authorities could however argue that the burdensome checks are a de facto impediment to the ability of British and Spanish citizens to exercise their right to work in another member state (i.e. on the other side of the border) and are therefore illegal under EU law. This is particularly true as the restrictions would not apply to the other border crossings, such as the Portuguese or French ones, although the Spanish could counter that the levy would be no different to localised toll roads or charges.

On the border crossing issue, EU member states are still allowed to police their own external borders, but internal border controls have been abolished in the Schengen area of which the UK is not a part. Therefore, Spanish authorities have the right to impose border controls, but according to a Commission source they have to be "proportional".

In other words, we have absolutely no idea whether the UK would be successful should it take Spain to the ECJ. The wonders of EU law...

Dutch PM and FM reiterate the Netherlands' desire for flexible Europe

The concept of a 'flexible Europe' seems to translate across borders. In a joint letter to the Dutch Parliament, Prime Minister Mark Rutte and Finance Minister Jeroen Dijsselbloem have reiterated the government's position that it wants countries to have the right to opt out of individual EU policies, such as the Schengen zone and the eurozone, or from the EU altogether.

Here are the relevant bits from the letter:

"Following the request by member Schouten to the Finance Minister and the Prime Minister (issue number 2013Z01025) for a letter about the exit from the eurozone, we report as following.  

The cabinet introduced in its coalition agreement that it should be possible under mutual consideration to exit from the community arrangements (Schengen, eurozone, European Union). This requires in the case of the eurozone and Schengen a treaty change as the current EU treaty does not foresee this possibility."

Is Sarkozy's tough talk on EU open borders hot air?

EU relations have become a pretty substantial source of contention in the French Presidential race. Socialist candidate Francois Hollande has been calling for a renegotiation of the fiscal treaty, recently signed by EU leaders, since January. Nicolas Sarkozy accused Hollande of playing politics with a sensitive treaty, as the renegotiation, he argued, amounted to rewriting the treaty in favour of the French Left, rather than taking into account the national interests of France. Meanwhile, EU leaders have waded into the debate, publicly endorsing Sarkozy in a move to protect the treaty from a further round of negotiations.

In a sudden turn of events, Sarkozy has replicated Hollande’s tactics, calling for a withdrawal from the Schengen treaty on open borders, if no serious reforms are undertaken. This follows complaints issued by six Schengen states, which have claimed that Greece's porous borders allow people to pass into Europe, legally or otherwise, unchecked. The Austrian Interior Minister compared Greece’s border policy to an “open barn door”.

Sarkozy argued that the reform of the agreement is “the only way to avoid the implosion of Europe” and added that

"It's urgent because we cannot accept being subjected to the shortcomings of Europe's external borders...But if I note within the next 12 months that no serious progress has been made in this direction, then France will suspend its participation in the Schengen accords until these negotiations are completed."

For good measure, Sarkozy also called for a "Buy European Act", under which European governments would be obliged to prefer European goods in their purchases, arguing, “that way companies which produce in Europe will benefit from European state money”.

Unsurprisingly, Hollande's camp was quick to fire back, with Pierre Moscovici, Hollande’s campaign manager, pointing out sarcastically that

"Conservative leaders [read: Merkel], who have been so quick to unite to defend the president, will appreciate his threat to pull unilaterally out of the Schengen zone at the same time that he calls for the signature of the austerity treaty in the name of European cohesion."

Electoral mud-slinging aside, is Sarkozy genuinely going for an overhaul of the Schengen Treaty and a fresh slew of trade measures to protect European firms? It's doubtful.

A mechanism to temporarily re-introduce internal border controls already exists within Schengen, bit its precise meaning is vague and limited to “a serious threat to public policy or internal security.” In addition, the European Commission has proposed a clearer, beefed up procedure, currently subject to negotiations between member states. So in theory, it's possible to 'suspend' Schengen (i.e. introduce border controls). This was a discussion that flared up last year in Denmark (which did actually re-introduce some additional controls) and in a border row between France and Italy. But in practice, this would be hugely complicated, as the mechanism only allows a country to keep the checks in place for 30 days, which must be justified on grounds of "internal security." If Sarkozy did in fact go down that road, he would have an almighty political row with EU partners on his hands, akin to De Gaulle's "empty chair" episode.

A more likely outcome - in the event that Sarkozy does get re-elected - is some minor reform, such as boosting the budget of Frontex (the EU's border agency), more money to Greece and other border states and perhaps clearer rules on member states' ability to take action (as per the Commission's proposal minus, we suspect, the strong role the Commission sees for itself), which will then allow Sarkozy to claim a political victory. As ever, EU politics is a great avenue for politicians to promise all kinds of stuff, only to let it get lost in the often tedious details of EU law/politics.

On his second 'ultimatum' to Brussels, Sarkozy has actually promised different versions of 'Buy European' rules for some time. In 2007, he floated the idea of "European champions" to be promoted over global competitors. As ever, it's unclear exactly what a "Buy European" act would involve, how it would be agreed, and how it would fit with existing WTO and EU state aid laws.

Today, EU Internal Market and Services Commissioner Michel Barnier said that the Commission was working on a proposal to introduce "non-protectionist" measures to favour European enterprises in the allocation of public sector contracts. The measures will allow member states to block non-EU businesses from bidding for public sector contracts if their country of origin does not have open public procurement markets. This is the case in China, for example. This will please Sarkozy, who called for "reciprocity" in commercial negotations between the EU and other states. British permanent representative in Brussels Aled Williams voiced fears that the new regulation could give rise to "tit-for-tat" responses from other countries, fuelling a trade war.

Sarkozy’s pledges were vague and perhaps disingenuous - this is an election campaign after all - but they are significant because they could represent part of a wider shift towards a more assertive French European policy (or perhaps a reaction to recent German leadership). Tellingly, Hollande's campaign manager accused Sarkozy of giving the impression of someone who “is not a French president…but almost a Conservative British Prime Minister.”

When Sarkozy introduced a Financial Transaction Tax earlier this year, he showed he was willing to flout EU opinion, and, in his view at least, lead the way. This time, Sarkozy has gone one step further, and, in rhetoric at least, suggested that he is willing to actually violate EU law to unilaterally impose his own border and government purchase policy. Other EU leaders have so far ignored his speech yesterday, but it will be interesting to see how they decide to react.

One this is clear, viewed from capitals around Europe, the French Presidential campaign just got a whole lot more interesting.

Open Europe has today published a new report looking at the impact of EU free movement and external immigration policies on the UK. We argue that, while free movement comes with benefits, reform is needed to avoid losing all public confidence in the concept - much of which applies beyond the UK.

Would EU law introduce border controls with Scotland?

The last time there was a formal English border with Scotland was under the Romans, although for some parts of the middle ages both England and Scotland may have wished for one. Since then, it's pretty much been come and go as you wish. Well, that may - at least hypothetically - soon change.

This week saw the debate over Scottish independence heating up again, in turn throwing up a number of questions about whether Scotland would have to negotiate new membership terms with the EU, and if so, how this would work. Most discussions have focussed on the euro - which all EU members that don't have an opt-out (which only the UK and Denmark have at the moment) - are required to join.

But there's another interesting twist. You might assume that if Scotland again became independent, the current open border would continue. Well, you could be wrong. This is because while the UK has a specific opt-out from the EU's common travel area (the Schengen agreement) under, the Amsterdam Treaty incorporated the Schengen agreement into EU law (Article 77, previously it was a stand alone agreement), meaning that whoever signs up to the full body of EU law, also signs up to Schengen. In other words, similarly to the euro, Scotland would not automatically have an opt out.

The EU considers that all states should join the borderless EU. This would pose a problem for an independent Scotland as the UK and Ireland have their own Common Travel Area and external borders - to help facilitate travel over the Northern Irish Border. If Scotland was in Schengen, England (and the rump UK and Ireland) would need to apply an external border and passport checks on the new frontier.

That is if Scotland was in the EU at all. The UK's membership does not extend to former members. Scotland would therefore have to negotiate for itself an opt-out from Schengen as a part of its accession process from outside the EU.

In addition to a Schengen opt-put, an independent Scotland would also have to negotiate:

• Opt out from the Euro - so it could keep the English (or Scottish?) pound (the SNP says it want this option until the time is right to join the euro).
• Possibly its own budget rebate so it is not unfairly penalised
• A fair deal on fishing.

Plenty to play for in Europe, in other words, should Scotland wish to go down that path...