The so-called ‘SWIFT affair’ of 2009-10 brought into relief important changes, introduced by the Lisbon Treaty, in EU decision-making procedures for international agreements between the Union and third countries. The genesis of the affair lay, three years before, in the revelation by the New York Times in June 2006 that the US government, in its attempt to cut off terrorist financing worldwide, had a classified CIA programme for monitoring the financial transfers of American and European citizens, through the Society for Worldwide Interbank Financial Telecommunication (SWIFT), a Belgian-based messaging service collectively owned by the international banking community. Such monitoring, undertaken with SWIFT’s complicity, was legal in the United States but illegal within the EU. After a complex period in which efforts were made to ‘regularise’ Washington’s Terrorist Finance Tracking Program (TFTP), an agreement was negotiated in mid-2009 between the United States and European Union to allow the US Treasury legally to extract such data relating to European citizens, provided that certain safeguards were respected.
When the EU-US negotiation took place, the European Parliament had only limited powers over international agreements, especially in the field of Justice and Home Affairs (JHA) – one of the two intergovernmental pillars established by the 1992 Maastricht Treaty. JHA agreements were negotiated by the rotating presidency of the Council of Ministers, ‘assisted by’ the European Commission, and once agreed unanimously in the Council, were initialled, signed and finally concluded with the country, countries or international organisation concerned. Nothing in this process involved reference to the Parliament. So when, in September 2009, the Parliament passed a resolution setting out some serious data-protection concerns about the emerging TFTP agreement, this text was largely ignored by both the Council and Commission.
At the time, nobody could be sure when (or indeed whether) ratification of the new Lisbon Treaty would be completed. However, in October and November 2009, after many months of uncertainty, Presidents Lech Kaczynski of Poland and Václav Klaus of the Czech Republic, who had been refusing to sign the text, finally agreed to do so. Once the new treaty came into force, in December 2009, the decision-making method for several pending international agreements suddenly changed in mid-stream. For the TFTP agreement, this shift was to prove significant. The ‘communautization’ of the JHA pillar altered each of the pre-Lisbon features of how such agreements were negotiated and approved: the lead negotiator became the Commission, rather than the Council; agreements were to be adopted in the Council by qualified majority voting (QMV), rather than unanimity; and, most importantly, the Parliament could henceforth exercise a veto over the outcome, through the consent procedure (Article 218 TFEU).
Rather than adjust quickly to this new reality, both the presidency of the Council and the Commission proceeded essentially as if nothing had happened, hoping to present the Parliament with a fait accompli. The TFTP agreement was adopted by the Council in late January 2010, only a week before it was due to enter into force ‘provisionally’, pending final conclusion (such an arrangement is sometimes used when both parties are confident that that subsequent approval by their parliaments will be a formality). The justification for the speed was that if the February deadline were missed, there would be a gap in data transfer to the United States, posing potentially serious security risks.
However, many Members of the European Parliament (MEPs) felt that a gun was being held to their head, both on the substance of the agreement and the procedure for its endorsement: there was resentment at the fact that the agreement would only be voted upon in the Parliament after it had already entered into force. Once the relevant parliamentary committee (civil liberties) rejected the agreement – by 29 to 23 votes, with the German Christian Democrats crucially joining the Liberals, Socialists and Greens in opposing the text – it became considerably more likely that the Parliament as a whole would follow suit. Despite intense, last-minute lobbying by the Council presidency, the Commission and the US government – the US Secretary of State, Hillary Clinton, telephoned the President of the Parliament, Jerzy Buzek, on the matter – the plenary rejected the agreement on 11 February by the wider margin of 378 votes to 196, with 31 abstentions. At a meeting of the European Council the following day, the German Chancellor, Angela Merkel, is reported to have said that she could not understand ‘how it was possible’ for a position agreed by all 27 member states and the Commission to be struck down by the Parliament, suggesting that she had not taken the institutional implications of the Lisbon Treaty fully on board. The US Administration, although initially equally startled by the new power of the Parliament, quickly grasped its implications, reflecting long experience in Washington of the absence of compliant parliamentary majorities in Congress.
The Council had to withdraw its signature from the SWIFT agreement, which was therefore terminated after being in force for only a few days. After a period of reflection and informal consultation with both the US Administration and MEPs followed, the Commission and Council announced their intention to seek to negotiate a new agreement in a form that might meet the Parliament’s concerns. Under the Lisbon Treaty, the Commission now became responsible for conducting these negotiations, with the Parliament enjoying the right to be kept ‘immediately and fully informed at all stages of the procedure’ (Article 218(10) TFEU). The negotiating process was completed in May 2010, soon after the US Vice President, Joseph Biden, paid a visit to the Parliament, with the new text initialled by the Commission the following month. In a development unique in the history of the Union, between the initialling of the agreement and the Council’s decision to sign the text, the Spanish presidency of the Council met informally with the Parliament’s rapporteur, shadow rapporteurs and the coordinators of the political groups (on the civil liberties committee) to discuss whether any further changes might be necessary. The presidency indicated that it would not sign the agreement until it was sure that the Parliament would subsequently endorse it, a principle with potentially radical implications for negotiations in the future.
Copyright: Anthony Teasdale, 2012
Citation: The Penguin Companion to European Union (2012), additional website entry