Still don't agree.
Annex III covers the basic requirements for pilots licensing under the EASA regime, but the bit of Article 7 I referred to excludes Annex III when there is reliance on licences issued by a third country, otherwise the 7th sub paragraph makes no sense. That is not to say that EASA cannot legislate to cover this area, the Basic Law simply allows for Europe to do what ICAO contemplates and render legal flights where the state of registration and state of licence are the same.