Anna Caroline Jensen and Sune Klinge
BRIDGE Network Country Report
- Crisis Impact and Response
Briefly describe how the country in question was affected by, and responded to, these four major challenges: Euro-Crisis, Migration, Rule of Law, Brexit.
Denmark is not a Eurozone member, but pursues a fixed exchange rate policy against the euro. Denmark was thus not directly involved in the Euro-crisis, but after the international financial crisis struck in fall 2008 Denmark, like many other EU member states, entered a long period of recurrent recession. The Confederation of Danish Industry stated that 200,000 jobs were lost in Denmark due to the crisis. By 2018, the Danish economy had largely recovered, but unemployment rates were still not back to 2007-levels.
The Danish Parliament expressed its support for measures taken by the EU to mitigate the crisis in the Eurozone. In Denmark, no legislative initiatives specifically targeting the Euro-crisis were introduced, but the Government attempted to soften the impact of the financial crisis with a looser fiscal policy and a series of large-scale initiatives to boost and rebuild the economy. Between 2008 and 2013, six bank bailout packages secured financial stability in the Danish banking sector, and two tax reforms supported job growth and economic recovery.
Denmark, with a population of 5.7 million, received 21,316 asylum seekers in 2015, compared to 14,732 in 2014. In early 2015, the left-wing government introduced a new, temporary subsidiary protection status for some groups of asylum seekers and intensified control at borders and airports, while increasing the level of sentencing for illegal entry into Denmark.
After elections in June 2015, the new right-wing government presented a number of strict measures intended to make Denmark less attractive to potential asylum seekers. An “asylum package” with 34 measures in November 2015 formed the basis for the much-debated emergency law.
Some of these measures concerned refugees’ access to social benefits (already restricted a few months earlier with the introduction of a minimal integration allowance). Others limited the right to family reunification: Refugees with the new “temporary subsidiary protection” status would have to wait for three years to reunite with their families. Rejected asylum seekers faced shorter time limits for their stay in Denmark and increased powers for authorities to control and detain them until deportation. The most controversial measures were the requirement of self-payment from asylum seekers staying in Denmark and the empowerment of Danish authorities to confiscate assets worth more than DKK 10,000 (~EUR 1,350) in order to cover the cost of their residence, the so-called “jewellery” law.
The new legislation was heavily criticised by Danish and international organisations working in the field of human rights and refugees, and it received a very negative assessment from the UNHCR. Still, with some minor modifications Parliament passed the law (81 against 27).
The former Minister of Immigration and Integration is currently the focus of an official investigation into actions taken during the migration crisis. The central question is whether the Minister ordered the unconditional (and therefore unlawful) physical separation of all couples in asylum centres where the woman was under the age of 18, under the pretext of saving girls from child marriage. This was put into practice in the centres where also couples with children were separated. Due to its absolute nature, such a rule would be contrary to Danish administrative law and the fundamental right to family life. Another issue concerns whether the minister misled Parliament at the time, possibly giving incorrect answers about her decisions.
Rule of Law
Denmark is not involved in the Rule of Law Crisis in the Eastern Member States.
As the UK seems to be heading towards a no-deal Brexit, the Danish government has established task forces, upgraded relevant agencies and launched a number of other initiatives in order to prepare for its foreseeable impact on Danish trade and industry. In 2019, the UK was Denmark’s fourth-largest trading partner in both export and import, so the Danish economy is likely to see a perceptible setback. Parliament has passed two laws to secure the temporary continuation of rights flowing from EU law for UK and EU/EEA citizens exercising their right to free movement between Denmark and the UK, thus prolonging existing rules until a new regime has been agreed upon.
The Faroe Islands and Greenland are part of the Danish realm but not members of the EU. Both are economically highly dependent on fishing in the North Atlantic and export to the UK. Greenland and the Faroe Islands will have their own bilateral agreements with the UK. The Faroe Islands signed a trade agreement with the UK in February 2019, while Greenland is expected to conclude one by the end of 2020.
- Differentiated Governance
Please describe any EU policy fields in which the member state’s participation or status is different from other EU member states (e.g. opt-out, enhanced cooperation). In particular, point out differentiation in the field of EMU (e.g. single currency, etc), migration (e.g. Schengen, etc.) and Rule of Law (e.g. participation in European Public Prosecutor’s Office).
The Danish opt-outs
Since the Edinburgh Decision of December 1992, Denmark has had four opt-outs from the EU cooperation. These concern the EMU (Economic and Monetary Union), the CSDP (Common Security and Defence Policy), the JHA (Justice and Home Affairs) and the EU Citizenship. They were decided at a European Council meeting as a response to Denmark’s initial rejection of the Maastricht Treaty in the 1992 referendum. With the opt-outs, Denmark ratified the Treaty after its approval in a second referendum in 1993. Denmark is free to give up its exemptions at any time and would then be obliged to apply in full all relevant EU measures in force at that time. However, to give up one or more of the opt-outs would require a national referendum, according to Danish constitutional law. The opt-outs with a reference to the Edinburgh Decision now appear in Protocol no. 22 on the Position of Denmark, of the Lisbon Treaty.
The Euro opt-out means Denmark does not participate in the third stage of Economic and Monetary Union (i.e. joining the Euro), but instead retains its national currency (krone) and its powers in relation to monetary policy. The opt-out gives Denmark the right to decide whether and when to join the Euro. Protocol No. 16 of the Lisbon Treaty specifically concerns the Danish EMU exemption. A separate referendum on the Euro opt-out took place in 2000, when a majority voted against joining the third phase of EMU. However, Denmark fully participates in the second phase of the EMU and the European Exchange Rate Mechanism, ERM-2. Denmark furthermore cooperates with the ECB and the euro-area member states through intergovernmental agreements such as the Stability and Growth Pact and the Treaty on Stability, Coordination and Governance in the EMU (the Fiscal Compact), and joined the Euro Plus Pact in 2011. Denmark also takes part in the European Semester.
With the CSDP opt-out, Denmark is not part of any EU military operation or cooperation on the development and acquisition of military capabilities within the EU framework and is not obliged to contribute financially to such operations nor make military capabilities available to the Union. Consequently, Denmark is not involved in decisions with defence implications but “will not prevent the other Member States from further developing their cooperation in this area.”  As the reservation concerns the substantive area in question, Denmark cannot enter into parallel agreements in the areas covered by the opt-out. The practical importance of this opt-out has grown significantly over the years, and it may now seem paradoxical in light of the considerably increased Danish military engagement in international operations, in particular as part of the NATO alliance.
The JHA opt-out exempts Denmark from all supranational legal policy. The opt-out is overall concerned with three main areas: (1) border control, asylum and immigration; (2) civil law; and (3) police and criminal law cooperation.
This is viewed as a reservation to the mode of cooperation, namely supranational cooperation, and therefore it is possible for Denmark to enter into intergovernmental agreements in this area, which it has done in many instances. In practice, the opt-out is thought to imply that Denmark stands outside approximately a quarter of the areas of relevance.
Schengen is subject to the JHA opt-out, but Denmark is able to participate in Schengen on an intergovernmental basis. However, due to the opt-out Denmark cannot participate in the negotiation or adoption of new EU legislation in this area. Thus, when existing Schengen rules are changed, or new ones introduced, Denmark can solely decide whether to implement them or not. It is not obliged to do so, but a failure to implement may result in the exclusion of Denmark from the Schengen Area (guillotine clause). Greenland and the Faroe Islands are not part of the Schengen zone.
Denmark does not participate in the new European Public Prosecutor’s Office (EPPO).
Denmark held a referendum on the JHA opt-out in 2015, determining if Denmark would maintain its original reservations in the area or replace the opt-out with an opt-in model, allowing for participation in the supranational legal policy on a case-by-case basis. One of the reasons for the referendum was that Europol was becoming a supranational agency, and Denmark with its opt-out could end up outside cross-border police cooperation in Europe. A majority voted to keep the opt-out unchanged. Denmark has since entered a special agreement on Europol, allowing cross-border cooperation to continue.
The citizenship opt-out: Section A of the Edinburgh Decision establishes that the rights and protection stemming from citizenship of the Union “do not in any way take the
place of national citizenship.” With the Amsterdam Treaty, this opt-out became more or less redundant, as what is now art. 20 of the TFEU clarifies that the citizenship of the Union is additional to national citizenship.
2.1.2 The Second Home Protocol
Protocol No. 32 of the Treaty of Lisbon, entitled ‘On the Acquisition of Property in Denmark’, stipulates that Denmark may maintain its existing legislation on the acquisition of second homes. This reservation is a derogation from the EU principle of non-discrimination, in particular from the Treaty provisions on free movement of capital and services, as Denmark may prohibit nationals of other Member States from acquiring second homes. The protocol is often referred to as the fifth opt-out, but dates back to the Maastricht Treaty and has a much older origin. The Danish legislation in question is from 1959. Non-Danish nationals may buy a summerhouse only if they have lived in Denmark for at least five years or if they obtain a dispensation from the Ministry of Justice, which normally requires a close relationship to Denmark.
2.1.3 Other areas of Policy Differentiation
- Intra-EU Differentiation.
Denmark, along with EU members Finland and Sweden, is a member of the Nordic Council, which further includes Iceland, Norway, the Faroe Islands, Greenland and Åland. The Nordic Council dates back to 1952. The Nordic Council of Ministers cooperates at the inter-governmental level while inter-parliamentary cooperation takes place in the Nordic Council. The countries work together towards this goal in a number of policy areas: Legislation and justice, working life, digitalisation, disability, environment and climate, sustainable development, children and young people, energy, culture, education and research, gender equality, and language. The Nordic welfare states share many similarities. Apart from (in most cases) related languages and cultural heritage, they rely more or less on the so-called “Nordic model,” combining free market activity with large public sectors and a high level of trust in society.
A series of agreements govern Nordic cooperation. These include the Helsinki Treaty of 1962 and agreements on for instance cultural cooperation, a common labour market, the waiving of passport checks at internal Nordic borders, and a language convention giving Nordic citizens’ the right to use their own language in other Nordic countries. Many of these agreements are older than the EU, some dating back to the 1950s.
Denmark is a member of the Arctic Council, again with Sweden and Finland as fellow EU members. The Council otherwise consists of Canada, Iceland, Norway, Russia, and the US. This includes 6 indigenous peoples’ organisations with Permanent Participant status in the Council, 6 working groups, and close to 40 non-arctic states and international organisations holding Observer status in the Council. It was established in 1996 and aims to provide “a space and mechanism to address common concerns across Arctic States – with a special emphasis on the protection of the Arctic Environment and sustainable development.”
Three legally binding instruments have been negotiated so far: The agreement on cooperation on aeronautical and maritime search and rescue in the Arctic (2011), the agreement on cooperation on marine oil pollution preparedness and response in the Arctic (2013) and the agreement on enhancing international Arctic scientific cooperation (2017). Denmark, with the Faroe Islands and Greenland’s geostrategic importance and natural resources, recognises the growing significance of the Arctic region and is very keen on gaining a say in the international cooperation in the area.
- Territorial Differentiation
The Danish Realm consists of Denmark, the Faroe Islands and Greenland. The last two are autonomous overseas territories. The Faroe Islands got home rule with the 1948 Home Rule Act. Greenland acquired Home Rule in 1979, and later self-governance with the 2009 Self- Governance Act. With these changes of autonomy, the Faroe Islands and Greenland took over certain areas of jurisdiction. Neither the Faroe Islands nor Greenland are members of the European Union.
The Faroe Islands, with autonomy within the Danish Realm dating back to 1948, decided not to become a member of the European Communities when Denmark joined in 1973. Consequently, the Faroe Islands is a third country in relation to the EU, and the Treaties do not apply. The formal relations between the European Union and the Faroe Islands are laid down in bilateral agreements such as the Free Trade Agreement, the Bilateral Fisheries Agreement and the Agreement for Scientific and Technological Cooperation.
In the 1972 referendum on Denmark’s accession to the EU, app. 70% of the Greenlanders voted against accession. However, being an integral part of Denmark at the time, Greenland had to join along with the rest of Denmark. After gaining autonomy with the home rule arrangement in 1979, Greenland voted to leave the EU in 1982 and formally left in 1985. Due to its constitutional relationship with Denmark, Greenland acquired the status of ‘Overseas Country or Territory’ (OCT), thus staying associated with the EU.
Greenland is eligible for funding from the EU’s general budget through the EU-Greenland Partnership. In 2015, Greenland, Denmark and the EU agreed on a framework for the future relationship between the EU and Greenland/Denmark in the non-binding “Joint Declaration on relations between the European Union, on the one hand, and the Government of Greenland and the Government of Denmark, on the other.”
Greenland’s special relationship with the EU is laid down in the “Greenland Treaty” and in the Protocol (No. 34) on special arrangements for Greenland of 1985, now part of the Lisbon Treaty. According to Art. 204 of the TFEU, Articles 198-203 TFEU (on the association of the overseas countries and territories) apply to Greenland, “subject to the specific provisions for Greenland set out in the Protocol on special arrangements for Greenland, annexed to the Treaties.”
Case law of the CJEU supports the view held by the Danish government that EU law is only applicable to Greenland – and OCTs in general – when it is explicitly stipulated (as it is in part four of the TFEU and Protocol No. 34 on Greenland). However, due to the triangular EU-Denmark-Greenland relationship, Greenland is not completely detached from the EU legal order. The Danish membership of the EU also has an impact in Greenland. In situations where parts of Danish law are put into force in Greenland in accordance with the Act of Self-Governance, and where this Danish legislation is derived from EU law, the underlying EU law is not part of Greenlandic law. However, as Danish law must apply in Greenland in these areas, EU law often influences the interpretation and application of the legislation in Greenland as Greenlandic courts and other legal entities must incorporate EU law principles when they interpret and apply Danish national law.
 Danish Aliens Act, article 7(3)
 Act no. 102 of 03/02/2016
 Act no. 1000 of 30/08/2015
 Act no. 264 of 25/03/2019 and Act no. 268 of 26/03/2019
 https://www.consilium.europa.eu/media/20492/1992_december_-_edinburgh__eng_.pdf (Decision of the Heads of State and Government, meeting within the European Council, concerning certain problems raised by Denmark on the Treaty on European Union, pp. 52ff)
 Protocol on the Position of Denmark, art. 7
 The Danish Constitution, article 20
 For a fuller explanation of Denmark’s peculiar position within the EU, see: Ulla Neergaard, “‘A more United Union’ and the Danish Conundrum” in The Future of Europe: Political and Legal Integration beyond Brexit. Ed. Antonina Bakardjieva Engelbrekt and Xavier Groussot. (Oxford, Hart Publishing, 2019). 249-274; Rebecca Adler-Nissen, Opting out of the European Union: Diplomacy, Sovereignty and European Integration. (Cambridge, Cambridge University Press, 2014).
 Neergaard 2019, p. 256ff
 For more information on this, see the Danish National Bank’s website: https://www.nationalbanken.dk/en/monetarypolicy/fixed_exchange_rate_and_ERM2/Pages/default.aspx
 Neergaard 2019, p. 259
 Protocol on the Position of Denmark, art. 5
 Neergaard 2019, p. 259
 Neergaard 2019, p. 262
 Protocol on the Position of Denmark, articles 2-4
 Neergaard 2019, pp. 263-264
 Protocol on the Position of Denmark, art. 4
 Neergaard 2019, p. 265ff
 Neergaard 2019, p. 266
 Torben M. Andersen, Bengt Holmström, Seppo Honkapohja, Sixten Korkman, Hans Tson Söderström, Juhana Vartiainen, The Nordic Model, Embracing globalization and sharing risks, The Research Institute of the Finnish Economy (ETLA), Taloustieto Oy, Helsinki 2007 (p. 13f) https://economics.mit.edu/files/5726
 Lov om Grønlands Selvstyre, Lov nr. 473 af 12/06/2009
 https://www.faroeislands.fo/government-politics/foreign-relations/faroe-islands-in-europe/; https://www.government.fo/en/foreign-relations/missions-of-the-faroe-islands-abroad/the-mission-of-the-faroes-to-the-european-union/the-faroe-islands-and-the-european-union/; https://ec.europa.eu/info/research-and-innovation/strategy/international-cooperation/faroe-islands_en
 For a comprehensive account of the Greenland-Denmark-EU relationship, see: Ulla Neergaard, “The Legal Relations between the EU, Greenland and Denmark – A Harmonious Love Triangle?” Ulla Neergaard, 2020
 Neergaard, 2020, p. 226ff
 Neergaard, 2020, p. 229ff