Liechtenstein and the EEA: EEA Law as Supplementary Constitutional Law

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Georges Baur

Liechtenstein-Institut

  1. Introduction 

Liechtenstein is a small-sized country (and has a very small inhabitable area of rural character [Decision of the EEA Council No 1 /95 of 10 March 1995, Declaration on free movement of persons]). As such, it is highly dependent on its relations with its neighbours and beyond. Moreover, Liechtenstein has always been integrated into larger economic areas: for example, it was integrated with Austria-Hungary, and, after its dissolution in the wake of World War I, Liechtenstein joined the Swiss customs territory. In 1995, after finding a solution to the problems that arose from the fact that Switzerland decided not to ratify, Liechtenstein finally became a party to the European Economic Area Agreement (EEA Agreement). 

The Liechtenstein Constitution (Liechtensteinische Landesverfassung; LV) has proven to be a very flexible legal instrument that was able to bridge the potential conflicts arising from such attachments to other legal spheres and protect the constitutional rights of its citizens. The LV contains only minimal provisions on international public law. Nevertheless, it provides certain legal guidelines, as will be shown.

2. The EEA Agreement 

EEA membership essentially entails an obligation to adopt (European Union) law in an efficient and timely manner. However, some members of the the EEA (namely the European Free Trade Agreement (EFTA) states Iceland, Liechtenstein and Norway) are not EU members and so have not ceded any sovereign rights to a supranational level. They are therefore bound by their respective constitutions with regard to the adoption of EEA law. This naturally leads to a tension between the two regulatory areas of the EEA Agreement and the national constitution. It may even lead to conflicts with the traditional national legislative process, especially direct democratic participation rights.

In contrast to the EU, in which the adoption of law takes place through co-decision, this is not the case with the EEA/EFTA states. In the EEA, the adoption of (EU-) law only takes place after the respective legal acts have been adopted by the EU member states and the EU Parliament.

This particular way of introducing EU legal acts into the EEA, and therefore making these applicable to the EEA EFTA states, is the so-called dynamic adoption of EU law, or the respective legal acts. It aims at ensuring legislative homogeneity in the enlarged internal market - i.e. the same law applies to all those participating in the internal market.

The dynamic adoption of law is set out in Articles 102 and 103 of the EEA Agreement. Article 102 regulates the general case of how EU legal acts are to be introduced into the EEA and Article 103 regulates the particular case in which conditions of the respective national constitutions must be observed. What these are is – of course – determined by national constitutional law.

3. How Does the Liechtenstein Constitution deal with EEA Law? 

A.  International Law in Liechtenstein’s Constitutional Order

As is well known, international law doctrine distinguishes between the two main approaches to the relationship between international and national law: "monism" and "dualism". The main difference is that monism assumes that international (treaty) law and national law are two components of the same overall legal order. The (entire) legal order is thus regarded as a unit. Dualism, on the other hand, assumes that international (treaty) law and national law are two completely independent areas of law. 

The main consequence of this distinction is that international law is directly applicable in monist systems and requires transformation into national law in dualist systems. 

Liechtenstein, like its two immediate neighbours Austria and Switzerland, holds a fundamentally monistic view of the relationship between international law and national law. Interestingly, despite the country's long-standing ties to international law, the country’s monist approach was only made explicit by the legislature, executive, judiciary and in scholarly writings in the last quarter of the 20th century. 

The question then arises as to the order of precedence between the two legal orders. According to Liechtenstein’s Constitutional Court in its decision StGH 1996/34 (LES 1998, 80), international law, at least the most important international treaties Liechtenstein is a member of, like the EEA agreement or the European Convention on Human Rights, have the character of "supplementary constitutional law". That view is widely shared by scholarly writings.

B. EEA Decisions in Liechtenstein Law 

EU law is formally incorporated into the EEA by Decisions of the EEA Joint Committee (JCDs), consisting of the representatives of the three EEA EFTA states and the EU. JCDs are to be regarded as international treaties or international law 'mini-treaties'. Therefore, the constitutional provisions on the procedure for concluding international agreements or treaties are to be applied.

According to Art. 8 para. 2 of the LV, 

“Treaties by which territory of the State would be ceded, State property alienated, sovereign rights or prerogatives of the State affected, a new burden imposed on the Principality or its citizens, or an obligation assumed that would limit the rights of the citizens of Liechtenstein shall require the assent of Parliament to attain legal force.”

According to Peter Bussjäger, however, these five criteria are so broad that in practice every international treaty is submitted to the Parliament. However, for the dynamics required by the EEA agreement, in particular that an amendment to an annex to this agreement shall be made as soon as possible after the adoption by the EU of the corresponding new legislation (Art. 102 para. 1), the usual approval procedure in Parliament is not practicable. It is true that for the discussion of international treaties, as opposed to the discussion of bills, only one reading is necessary before the vote. Nevertheless, consideration of an international treaty can be delayed if motions for non-admission, postponement or referral back to the government are submitted. Moreover, this procedure would have to be carried out for each of the approximately 370 EEA legal acts or 240 decisions of the EEA Joint Committee each year (figures of 2020). Hence, a parliamentary committee was established that normally approves the adoption of Joint Committee Decisions for Liechtenstein. However, some decisions may affect the constitutional rights of Liechtenstein citizens. For this reason, prior to Liechtenstein's accession to the EEA, the Constitutional Court elaborated in an opinion StGH 1995/14 (LES 1996, 122) the criteria for deciding which legal acts should be submitted to Parliament for full scrutiny.

4. Criteria for (Full) Parliamentary Involvement 

Essentially, according to the Constitutional Court’s opinion, there are two main criteria that trigger the constitutional requirement of approval by Parliament and subsequently submission to referendum: 

  1. if Liechtenstein law is to be amended, with the exception of matters that fall entirely within the competence of the government at the national level; 

  2. in the case of legal acts providing for participation in programmes with financial or retroactive effect and which are subject to referendum at national level. 

In principle, only binding legal acts according to Art. 8 para. 2 LV require approval, namely regulations or directives according to Art. 7 EEA agreement. 

Finally, the Constitutional Court’s opinion provides for a pragmatic element: the objectives of the EEA Agreement should be realised in an efficient and timely manner.

It is left to the EEA/EFTA States to decide through which bodies and in which procedures approval is granted according to their own constitutional order. With regard to Liechtenstein, the strong (direct) democratic character of political decision-making, i.e. the possible requirement to hold a referendum (Art. 66bis LV), must be taken into account. However, in the more than 25 years since Liechtenstein joined the EEA, no referendum has ever been held against the Landtag's approval of a decision of the EEA Joint Committee.

5. In conclusion: balance between the constitution and EEA law

As mentioned above, there is a tension between the Liechtenstein Constitution, which provides for extensive direct-democratic rights of participation in lawmaking, and the EEA Agreement, which requires dynamic adoption of law in order to maintain homogeneity in the internal market. The reduction of this tension is facilitated on the one hand by the openness of the Liechtenstein Constitution, especially since it contains few provisions regarding the effect of international law on the Liechtenstein legal order. On the other hand, EEA law is given the status of supplementary constitutional law. Furthermore, the fundamentally pro-international law attitude of Liechtenstein law also facilitates a largely conflict-free handling of international or EEA law rules. Liechtenstein seems to have found a good balance between guaranteeing the constitutional rights of participation and the EEA requirement for efficient adoption of law. 

Dr Georges Baur is a Senior Research Fellow (Law) at the Liechtenstein-Institut

Suggested Citation: Georges Baur, “Liechtenstein and the EEA: EEA Law as Supplementary Constitutional Law” IACL-AIDC Blog (9 December 2021) https://blog-iacl-aidc.org/centenary-constitution-liechtenstein/2021/12/9/liechtenstein-and-the-eea-eea-law-as-supplementary-constitutional-law-ncy4m.