Bilateral Agreements III, now up to Parliament

Context

TL;DR

• Swiss government delivered Bilateral Agreements III to Parliament
• Agreements aim to stabilize relations with the European Union
• Key sectors include energy, healthcare, and food safety
• Expected benefits for Ticino workers and regional economy

Key facts

• Delivery date: March 13, 2026
• Parliament deadline: End of 2026
• Horizon Europe 2024: Switzerland contributed around 140 million francs
• Ticino commuters: About 70,000 cross-border workers
• Commuter GDP impact: Roughly 3 billion francs annually in Ticino
• Border wait reduction: At least 15-20% at Chiasso, Mendrisio, and Lugano
• Rail investment: Approximately 250 million francs by 2028
• Energy modernization: About 500 million francs by 2025

Bilateral Agreements III, now up to Parliament

On March 13, 2026, the Swiss government officially delivered the message regarding the Bilateral Agreements III with the European Union to Parliament, marking a decisive moment in Switzerland’s relationship with Brussels. This step takes place amid increasing international uncertainty, where the desire to maintain stable and reliable ties with the EU clashes with the need to protect Swiss political independence and sovereignty. The agreements include strategic adjustments in key sectors such as energy, healthcare, and food safety, as well as ensuring Europe's participation in research programs like Horizon Europe, which in 2024 saw Switzerland contribute around 140 million francs and could expand thanks to these new agreements.

For Ticino, a strategically important region economically and socially, this revision represents a significant step forward. It is estimated that about 70,000 cross-border commuters work in Ticino companies, contributing roughly 3 billion francs annually to the regional GDP. Normalizing access conditions to the European labor market and simplifying customs controls could reduce border wait times at Chiasso, Mendrisio, and Lugano by at least 15-20%, fostering increased productivity and reducing logistical costs estimated at around 150 million francs per year.

The main issue is compliance with EU regulations, which in the railway sector translates into conditions equal to Swiss standards, facilitating the movement of about 20,000 commercial and passenger vehicles daily between Italy and Switzerland. This improvement will also enhance energy security, thanks to participation in cross-border network projects and the development of sustainable infrastructure. The Federal Council’s strategy balances openness with the protection of national interests, paying close attention to economic and social implications: an example is the plan to upgrade the rail network between Lugano and Chiasso, with an investment of approximately 250 million francs by 2028, aiming to reduce travel times from 30 to 20 minutes.

The parliamentary debate will be crucial for final approval. Broad support is expected, considering the practical benefits for businesses, cross-border workers, and local communities. In practical terms, ratification could lead to a reduction in administrative barriers with the EU, simplifying procedures for professional recognition, as already happening in the healthcare sector, where about 2,500 cross-border doctors could benefit from a streamlined recognition process.

Comparing scenarios, a failure to ratify could result in increased customs costs and restrictions, with an estimated loss of about 200 million francs annually for Ticino businesses and a negative impact on labor flows. Conversely, the agreement could strengthen Ticino’s role as a bridge between Europe and Switzerland, boosting regional competitiveness and security.

Ultimately, signing these agreements would mark a turning point in managing relations with the EU, strengthening cooperation without compromising sovereignty—a key goal for Ticino and its cross-border communities. The next phase, parliamentary ratification, will be decisive in turning these opportunities into tangible benefits for the territory and its people.

Operational details

Bilateral Agreements III, now up to Parliament

The pragmatic approach adopted by the Swiss government is reflected in the negotiation methods and the conditions set for European parties, ensuring a balance between economic needs and the protection of cross-border workers’ rights. One of the most critical aspects concerns how international railway traffic will be opened, which will continue to respect Swiss regulations, including wage levels and working conditions for cross-border workers. Currently, the minimum salary for cross-border commuters in Ticino is set at around 3,600 CHF per month, with working conditions guaranteed by Swiss laws and collective agreements. This ensures that workers coming from Italy, such as from Como or Varese, are not subjected to lower conditions than Swiss employees, maintaining fairness in the cross-border labor market.

Practical example: In Lugano, it is estimated that about 28% of workers are cross-border, with around 25,000 employed in sectors like retail, logistics, and manufacturing. The continuity of regulations guarantees that these workers will continue to benefit from salaries and conditions compliant with Swiss laws, even with the new legislative framework.

Additionally, the energy agreement aims to ensure supply security for the canton, avoiding potential energy crises that could threaten economic activities and large infrastructure projects like the Mendrisio Technology Park or manufacturing companies in Como, which depend on Swiss energy supply. The regulation foresees an investment of about 500 million francs by 2025 to modernize distribution networks.

Agreements on food safety, health, and consumer protection have been strengthened with stricter rules, such as updates to import regulations for food products, involving more frequent inspections and harsher sanctions for violations. These measures benefit consumers and local businesses, such as restaurants and grocery stores in Mendrisio.

From a regulatory standpoint, Swiss Parliament will need to approve the package by the end of 2026. Its approval will trigger a series of legislative adjustments at national and cantonal levels, including revisions to the Civil Code and amendments to labor and social security laws. For example, resources for the Employment Regulation Agency are expected to increase, with a budget of around 20 million francs annually, to ensure more effective controls.

Practical impact: Ticino companies, such as those in manufacturing in Chiasso or Bellinzona, will need to adapt their hiring practices and comply with new regulations, with an operational checklist including: verifying employment contracts, training staff on updated regulations, and implementing monitoring systems for working conditions.

European standards, already partially incorporated through Bilateral Agreements I and II, will be expanded and refined, ensuring greater coherence and cooperation between the two legal systems. This will facilitate, for example, the free movement of workers and the recognition of professional qualifications between Switzerland and the EU, reducing bureaucratic delays and costs.

Practical comparison: Currently, an Italian worker with healthcare qualifications takes about 3 months for professional recognition, but with the new rules, this could be reduced to around 6 weeks, encouraging mobility and employment.

In conclusion, the package of Bilateral Agreements III represents a strategic step toward greater stability and collaboration between Switzerland and the EU, with tangible impacts on cross-border workers’ lives and Ticino companies’ competitiveness. Their implementation, through legislative and operational steps, will provide a more solid, fair, and functional framework for the future.

Useful tools to protect your net income

To reduce FX leakage, compare CHF-EUR exchange options and banks for cross-border workers.

Key points

Bilateral Agreements III, now up to Parliament

For cross-border workers and businesses in Ticino, these agreements are crucial to ensuring stability and opportunities for economic growth. In particular, recent proposals for revision and update of these agreements require careful monitoring, as they could entail substantial changes in regulations governing access to the Swiss labor market and the conditions for cross-border workers.

For example, in Ticino, with about 60,000 cross-border commuters, any regulatory change could affect roughly 10% of these workers, with direct impacts on wages, contractual conditions, and tax rates. Currently, the average salary for a cross-border worker in Ticino is around 4,500 CHF per month, but potential modifications to tax rates or permit conditions could cause variations of several hundred francs, directly influencing purchasing power and financial planning for families.

It is therefore advisable to stay informed about legislative deadlines and prepare for potential contract adjustments or company regulation changes. The revision could, for example, introduce new income thresholds for withholding tax payments or change conditions for work permits, possibly including time limits or specific requirements.

To facilitate this transition, the Frontaliere Ticino website offers useful tools such as the salary calculator, which allows simulating the effects of new regulations on net wages and taxes, along with detailed information on European regulations and permit application procedures.

Operational checklist: - Verify your permit type and expiration dates (e.g., L, B, or G permits). - Consult official guides on new European and Swiss regulations, available online. - Use the salary calculator to assess the impact of potential tax changes. - Communicate with your employer or tax advisor regarding necessary contractual adjustments. - Regularly follow official portals of Ticino Canton and industry associations for timely updates.

⚠️ Remember that final approval by Parliament could occur by the end of the year, making early preparation essential. The regulation might, for instance, introduce stricter limits on access to work permits for EU citizens or require new minimum income levels, such as the 3,500 CHF monthly threshold recently proposed.

Comparing practical scenarios, a company with 50 cross-border workers might need to recalculate salary and tax costs if tax rates increase, while another worker could benefit from improved permit conditions, ensuring greater stability and job security.

The evolving collaboration between Switzerland and the EU, and the new agreements, could bring tangible benefits not only to workers but also to companies, fostering a more competitive and attractive cross-border environment. Staying informed and prepared is the first step to successfully navigating this transition.