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EUROPEAN UNION

Why does Denmark have four EU ‘opt-outs’ and what do they mean?

Denmark is to vote in a June 1st referendum that could bring to an end one of its four EU ‘opt-outs’ which keep it separate from the European Union on specified sovereign areas. But what are the four ‘opt-outs’ and why do they matter?

Prime Minister Mette Frederiksen sits in front of the Danish and EU flags.
Prime Minister Mette Frederiksen sits in front of the Danish and EU flags. The Nordic country is to vote on an EU opt-out on June 1st. Photo: Mads Claus Rasmussen/Ritzau Scanpix

Prime Minister Mette Frederiksen called on Sunday for citizens to vote to overturn Denmark’s opt-out from EU defence policy in a referendum to be held on June 1st, following Russia’s invasion of Ukraine.

Denmark’s opt-out – retsforbehold in Danish – is one of four EU special arrangements negotiated by the Scandinavian country, and has seen it abstain from participation in EU military operations and from providing support or supplies to EU-led defence efforts.

READ ALSO: Denmark to hold referendum on scrapping EU defence opt-out

After the Danish public voted to reject the Maastricht Treaty in June 1992, Copenhagen obtained opt-outs in four sovereign areas: the single currency, justice and police matters, and EU citizenship along with defence, the opt-out which will be the subject of the June referendum.

The opt-outs mean, broadly, that Denmark is not obliged to follow EU laws on these areas and is also not involved in forming the laws – its ministers and officials do not participate in EU ministerial meetings in these areas.

The upcoming referendum will be the ninth to be held in the Denmark since it voted in favour of EU (then European Community) membership in 1972.

In December 2015, the Danes voted no in a referendum on the police and justice opt-out which would have strengthened the country’s cooperation with the European Union on those matters. Concerns about losing their sovereignty over immigration were a key factor in the ‘no’ vote.

Single currency

The single currency opt-out means that Denmark is not obliged to join the euro. The country has kept the krone as its currency and is also allowed to practice independent fiscal policy under the terms of the opt-out.

Although Denmark has not introduced the euro, it does participate in some areas of the single currency. For example, an agreement between the Danish central bank, Nationalbanken and the European Central Bank (ECB) means that the exchange rate of the krone follows that of the euro. When the ECB increases or cuts interest rates, Nationalbanken will do the same.

The exchange rate between the krone and the euro is also maintained at a very constant rate, echoing the relation between the krone and the Deutschmark in pre-euro times.

Meanwhile, Denmark cannot be sanctioned by the EU if its budget gives too high a deficit, unlike eurozone countries.

Danes voted no to ending this opt-out and taking on the single currency in a close referendum in 2000, in which 53.2 percent voted to keep the krone and 46.8 percent voted in favour of introducing the euro. Turnout was 87.6 percent.

Defence

The opt-out that will be in question in June’s referendum, defence, means that Denmark does not generally participate in the EU’s foreign and security policies in relation to defence, and is not involved in voting for those policies but can be involved in more general discussions of EU defence policies.

This means Denmark neither finances nor participates in any military operations conducted by the EU, and would not provide troops or equipment to EU-led missions in conflict zones.

Denmark does, however, take part in civil operations, which up to now have formed the bulk of EU military activities. The EU does not have its own army but EU member states’ military forces can work together under EU auspices.

Justice and police

This opt-out, which Danes voted to retain in a 2015 referendum (see above), means that Denmark in principle is outside of the EU cooperation on laws relating to border control, asylum, civil law, criminal law and cross-border crime. There are two important exceptions: visa rules and the Schengen area, in which Denmark participates fully.

The result of the 2015 referendum meant that Denmark chose not to replace its current blanket opt-out of EU justice rules with a model which would have allowed it to choose whether or not to participate in some areas of EU policy on a case-by-case basis – in other words, an “opt-in” model.

The justice and police opt-out means that Denmark does not participate Europol, the EU’s international policing and data resource-sharing organisation. Denmark does have some level of cooperation with Europol however, agreed following negotiations subsequent to the referendum.

EU citizenship

The final Danish opt-out, which relates to EU citizenship, does not have any practical effect.

The opt-out was adopted by Denmark to guarantee that EU membership would not eventually take the form of a national citizenship or an equivalent of this. This guarantee is now written into the EU treaty so that it applies for all member countries: EU citizenship is a supplement to national citizenship and does not replace it.

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EXPLAINED: Which Schengen area countries have border controls in place and why?

Borders within Europe's Schengen area are meant to be open but several countries have checks in place but are they legal and will they be forced to scrap them? Claudia Delpero explains the history and what's at stake.

EXPLAINED: Which Schengen area countries have border controls in place and why?

The European Court of Justice has recently said that checks introduced by Austria at the borders with Hungary and Slovenia during the refugee crisis of 2015 may not be compatible with EU law.

Austria has broken the rules of the Schengen area, where people can travel freely, by extending temporary controls beyond 6 months without a new “serious threat”.

But Austria is not the only European country having restored internal border checks for more than six months.

Which countries have controls in place and what does the EU Court decision mean for them? 

When can EU countries re-introduce border checks?

The Schengen area, taken from the name of the Luxembourgish town where the convention abolishing EU internal border controls was signed, includes 26 states: the EU countries except for Ireland, Bulgaria, Cyprus, Croatia and Romania, plus Iceland, Norway, Lichtenstein and Switzerland, which are not EU members.

The Schengen Borders Code sets the rules on when border controls are permitted. It says that checks can be temporarily restored where there is a “serious threat to public policy or internal security”, from the organisation of a major sport event to a terrorist attack such as those seen in Paris in November 2015.

However, these checks should be a “last resort” measure, should be limited to the period “strictly necessary” to respond to the threat and not last more than 6 months.

In exceptional circumstances, if the functioning of the entire Schengen area is at risk, EU governments can recommend that one or more countries reintroduce internal border controls for a maximum of two years. The state concerned can then continue to impose checks for another six months if a new threat emerges. 

Which countries keep border checks in place?

Countries reintroducing border controls have to notify the European Commission and other member states providing a reason for their decision. 

Based on the list of notifications, these countries currently have controls in place at least at some of their borders: 

Norway – until 11 November 2022 at ferry connections with Denmark, Germany and Sweden. These measures have been in place since 2015 due to terrorist threats or the arrival of people seeking international protection and have sometimes extended to all borders.

Austria – until November 2022 11th, since 2015, at land borders with Hungary and with Slovenia due to risks related to terrorism and organised crime and “the situation at the external EU borders”. 

Germany – until November 11th 2022, since November 12th 2021, at the land border with Austria “due to the situation at the external EU borders”.

Sweden – until November 11th 2022, since 2017, can concern all borders due to terrorist and public security threats and “shortcomings” at the EU external borders. 

Denmark – until November 11th 2022, since 2016, can concern all internal borders due to terrorist and organised criminality threats or migration.

France – until October 31st 2022 since 2015, due to terrorist threats and other events, including, since 2020, the Covid-19 pandemic.

Estonia – until May 21st 2022, from April 22nd 2022, at the border with Latvia “to facilitate the entry and reception of people arriving from Ukraine”.

Norway, Austria, Germany and France also said they are operating checks on non-EU citizens. 

Can Schengen rules survive?

Despite the exceptional nature of these measures, there have been continuous disruptions to the free movement of people in the Schengen area in the past 15 years. 

Since 2006, there have been 332 notifications of border controls among Schengen countries, with increasing frequency from 2015. In addition, 17 countries unilaterally restored border controls at the start of the pandemic. 

In December 2021, the Commission proposed to reform the system to ensure that border controls remain an exception rather than becoming the norm. 

According to the proposals, countries should consider alternatives to border controls, such as police cooperation and targeted checks in border regions. 

When controls are restored, governments should take measures to limit their impacts on border areas, especially on the almost 1.7 million people who live in a Schengen state but work in another, and on the internal market, especially guaranteeing the transit of “essential” goods. 

Countries could also conclude bilateral agreements among themselves for the readmission of people crossing frontiers irregularly, the Commission suggested. 

If border controls have been in place for 6 months, any notification on their extension should include a risk assessment, and if restrictions are in place for 18 months, the Commission will have to evaluate their necessity. Temporary border controls should not exceed 2 years “unless for very specific circumstances,” the Commission added. 

At a press conference on April 27th, European Commissioner for Home Affairs Ylva Johansson said the EU Court ruling about Austria is in line with these proposals.

“What the court says is that member states have to comply with the time limit that is in the current legislation. Of course we can propose another time limit in the legislation… and the court also says that it’s necessary for member states, if they would like to prolong [the border controls] to really do the risk assessment on whether it’s really necessary… and that’s exactly what’s in our proposal on the Schengen Border Code.”

Criticism from organisations representing migrants

It is now for the European Parliament and EU Council to discuss and adopt the new rules.

A group of migration organisations, including Caritas Europe, the Danish Refugee Council, Oxfam International and the Platform for International Cooperation on Undocumented Migrants (PICUM) have raised concerns and called on the EU institutions to modify the Commission proposals.

In particular, they said, the “discretionary nature” of controls in border regions risk to “disproportionately target racialised communities” and “practically legitimise ethnic and racial profiling and expose people to institutional and police abuse.”

Research from the EU Fundamental Rights Agency in 2021, the groups noted, shows that people from an ‘ethnic minority, Muslim, or not heterosexual’ are disproportionately affected by police stops.

The organisations also criticize the definition of people crossing borders irregularly as a threat and a new procedure to “transfer people apprehended… in the vicinity of the border area” to the authorities of the country where it is assumed they came from without any individual assessment. 

The article is published in cooperation with Europe Street News, a news outlet about citizens’ rights in the EU and the UK.

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