The Court publishes its long awaited Opinion 1/17 on the compatibility of the Investment Court System in CETA with EU law30/04/2019
Every Cloud has a Silver Lining: Some preliminary thoughts on Opinion 1/17
Opinion 1/17, summarised below, clarifies some longstanding questions, such as whether an international court may lawfully consider EU law as a matter of “fact”, and whether international investors’ protection through ad hoc judicial mechanisms violates the EU principle of equal treatment of “domestic” investors. Opinion 1/17 can be saluted as a step forward in reinforcing the position of the EU as an international actor with the tools and the responsibility to lead the development of international law. It equally appears to mark a step away from the unrealistic and perilous idea of “supremacy” of EU law over international law in the external relations.
Yet, in the “usual” fashion of the Court, Opinion 1/17 also paves the way to new questions on the scope of the “autonomy” of EU law. In particular, the Court appears now to raise doubts on the “constitutional” compatibility of the mechanism of preliminary reference from international tribunals to the CJEU, which features in a number of negotiated and negotiating international agreements of the EU.
The Court opens its reasoning in Opinion 1/17 with a discussion on the principles withstanding the relationship of the EU with international law, that are, the competence in principle to create courts of law and the need for these courts not to have adverse effects on the EU legal system, its “essential characteristics” and, it goes without saying, the “autonomy of its legal order.” Article 19 TEU and 267 TFEU also feature prominently among the principles that the Court recalls in the opening paragraphs of Opinion 1/17 to highlight the systemic importance of the EU judicial system for the preservation of the legal order.
Yet, the Court clarifies, the fact that the ICS is not part of the EU judicial system does not mean per se that that mechanism adversely affects the autonomy of the EU legal order. That it because, and here is the key to the decision, the jurisdiction of EU courts is not superior to that of courts sitting outside of the EU, that is, in this case, Canadian courts and the ICS itself. Indeed, the Court finally appears to expressly clarify that, was that not the case, the competence of the EU to set up international courts would be substantially deprived of significance by the unnatural lack of reciprocity arising out the fact that the EU and its Member States could virtually never be subject to the jurisdiction of an international court. That, the Court points out, would lead to curtailing the EU powers themselves to maintain and foster international relations (and I would add, its capacity to fulfill the mandate conferred by the Article 21 TEU to preserve and promote EU values abroad).
Significantly, the Court expressly distinguishes the case of the ICS from Achmea. Opinion 1/17 confirms the explanation of the Achmea judgement given by the CJEU President a few weeks ago in a speech at King’s College London, where he clarified that the rationale of that judgment does not reside in any particular issues of compatibility between EU law and arbitration, but rather in the principle of mutual trust among Member States. President Lenaerts explained that the principle of mutual trust is incompatible with mechanisms, such as the intra-EU investment tribunal in Achmea, by which Member States express distrust vis-a-vis the judicial system of fellow Member States. Such principle of mutual trust, the Court confirms in Opinion 1/17, is instead not applicable to a mechanism placed outside of the EU legal system, such as the ICS.
That said, the Court moves on to explain that the actual compatibility of the ICS with the autonomy of the EU legal order depends on whether that tribunal: a) is not conferred any power to interpret or apply EU law; and b) doesn’t have the power, by means of its awards, to prevent in practice the EU institutions from operating in accordance with the EU constitutional framework (the CJEU’s usual condition that the operation of international courts should not affect the balance of powers among the Institutions and the Member States).
The Court firstly clarifies the longstanding question of whether the applicable law provision in CETA that denies jurisdiction to the ICS “to determine the legality of a measure, alleged to constitute a breach of this Agreement, under the domestic law of a Party” and only allows it to take into account domestic law of the negotiating parties (thus also EU law) as a matter of “fact” solves incompatibilities with EU law. The answer appears to be yes. The devil is in the details: for the Court, an “examination” of domestic law on the part of the ICS tribunal made with the purpose to make a decision is different from an “interpretation” of EU law, which would inadmissibly affect the autonomy of EU law.
The Court also affirms that the powers conferred to the ICS do not affect the balance of powers among the EU and its Member States. Indeed the Court notes that the fact that it is for the EU to decide whether it will be the EU or its Member States to act as respondent in a case, is sufficient to preserve the jurisdiction of the CJEU to give rulings on the division of powers between the Union and its Member States.
In an unexpected twist, the Court appears to support the compatibility of the ICS with the EU legal system on the basis that CETA does not provide a preliminary reference mechanisms to the Court. This sentence, which appears almost casually “dropped” by the Court in the middle of its opinion (para 134) without being supported by any further reasoning, will give rise to an extensive debate in the coming months. It should be recalled here that many saw in an “EU Ukraine AA-style” reference mechanism the key to the compatibility of international dispute mechanisms with EU law. Belgium itself, in its request for an opinion on the CETA agreement, pointed at the absence of such a preliminary reference mechanism in the CETA agreement as one of the indicators of the alleged incompatibility of the ICS with EU law (para 50 of the Court’s Opinion). The scope and meaning of the decision of the Court on this point remain unclear. Were the Court really intending to exclude the compatibility with EU law of preliminary reference mechanisms, issues would arise not only in relation to the EU-Ukraine Association Agreement, but also to the Draft Withdrawal agreement with the UK and the negotiating EU-Switzerland framework agreement.
In the following part of Opinion 1/17, which will be analysed in more details elsewhere, the Court confirms the compatibility of the ICS with the institutional framework of the EU and the principle of equal treatment of investors (an issue that had remained pending in the Achmea judgement).
As for the compatibility of the ICS with the institutional framework of the EU, the Court states that, while the ICS is set up to protect the interest of foreign investors by ensuring their “fair and equitable treatment” (Article 28.3.2 of the CETA Agreement), the CETA agreement does not affect the powers of the Union to protect the public interest and to regulate (Article 8.9.1 of the CETA agreement).
The Court is equally not persuaded that the establishment of the ICS violates the general principle of equal treatment as enshrined in Article 20 of the Charter of Fundamental Rights of the EU (equality before the law), and Article 21(2) of the Charter of Fundamental Rights of the EU (discrimination on grounds of nationality). Indeed, as equal treatment requires that comparable situations must not be treated differently and different situations must not be treated in the same way the different situation of Canadian enterprises and natural persons that invest within the Union compared to that of enterprises and natural persons of Member States that invest within the Union leaves no ground for finding a violation of equal treatment provisions.
Some tentative conclusions
Opinion 1/17 sends out a positive message of renewed inter-institutional cooperation, where the judiciary rightfully scrutinizes the actions of the executive in the light of the constitutional principles of the EU, but restricts itself from interfering with policy making. The Opinion strengthens the role of the European Union in the international relations, and opens to a more "international law-friendly" approach of the trading block by clarifying that supremacy of EU law cannot go as far as operating in the external relations of the EU. Perhaps it is not too much to hope that enhanced unity in the EU trade relations will help overcome divisions, populism, rule of law issues, and the uncertainties around the imminent formation of a new Parliament and Commission.
Giorgia Sangiuolo, King's College London
Commission reports good advancement in the trade talks with Australia and Chile18/04/2019
The EU Commission has recently reported on the good advancements in the Free Trade Agreement (FTA).negotiations with Australia and Chile.
The third round of negotiations with Australia, started in mid-2018, saw 16 working groups formed of representatives of both parties meet to discuss almost all areas of the future EU-Australia FTA. Important progresses appear to have been done in the chapter on services and investment, where both sides have been able to achieve consolidated texts based upon the initial EU proposals for texts comprehensively dealing with the liberalisation of services and investment during this round. Further, Australia and the EU discussed all articles of the EU proposal on transparency and agreed in principle on several provisions, although some issues, such as the inclusion of judicial decisions into the scope and the application of dispute settlement to the chapter, still remain open. Trade and sustainable development commitments, on the topic of which the EU has presented ambitious proposals including climate change, labour and corporate social responsibility, also saw a substantive advancement, with both sides conducting discussions on topics like right to regulate, multilateral labour standards and agreements, including core labour standards, multilateral environmental governance and agreements, trade and climate change, biological diversity, sustainable forest management, sustainable fisheries, as well as institutional provisions.
The EU negotiations with Chile for the modernization of the FTA currently in force between the parties, started in late 2017, have reached their fourth round. The parties report good progress in a significant number of topics, including rules of origin, SMEs, services and competition, with important progress on the text. Important progresses appear to have been done with regards to the chapter on public procurement, where discussions continued on the consolidated text, in particular on how the proposed provisions that replicate commitments and obligations of the WTO Government Procurement agreement, or build on it, are in line with their domestic legislation. Likewise, advancements of negotiations regarding the chapter on customs and trade facilitations, and particularly on procedures for the release of goods, publication of customs-related information, the availability of advance binding decisions from customs, and disciplines relating to customs fees and formalities, are described as “significant.” Interestingly, the EU and Chile are also holding talks on “Trade and Gender” provisions, evaluating the incorporation of references to the Convention on the Elimination of all forms of Discrimination against Women and the 2030 agenda aims in their trade agreement.
EU-Japan Joint Committee adopts decisions for the implementation of the Economic Partnership Agreement10/04/2019
Today the EU-Japan Joint Committee has adopted a set of decisions on procedures for the implementation of the EU and Japan's Economic Partnership Agreement, which entered into force on 1 February 2019. The Joint Committee has also started a bilateral cooperation to monitor and support the implementation of the agreement.
The agreement benefits the bilateral trade relations in multiple ways, by for instance
- scrapping duties on many agricultural products (eg. Gouda and Cheddar cheese and wine exports);
- ensuring the protection in Japan of multiple Geographical Indications;
- facilitating the access of EU companies access to the procurement markets of 54 large Japanese cities, and removing obstacles to procurement in the economically important railway sector at national level;
- setting very high standards of labour, safety, environmental and consumer protection and strengthening EU and Japan's commitments on sustainable development and climate change;
- recognizing the equivalent protection of data on the territory of the two partners (in so creating the world's largest area of safe data flows).
As of 1 February, a large part of another agreement – the Strategic Partnership Agreement between the European Union and Japan – also applies on a provisional basis. This agreement, which was signed in July of last year together with the Economic Partnership Agreement, is the first-ever bilateral framework agreement between the EU and Japan and strengthens the overall partnership by providing an overarching framework for enhanced political and sectoral cooperation and joint actions on issues of common interest, including on regional and global challenges.
The Agreement will enter into force once it has been ratified by all EU Member States.
Commission publishes its Annual Report on EU trade defence01/04/2019
On 28 April the Commission released its annual report on trade defence.
Trade defence instruments (anti-dumping, anti-subsidy, safeguards) are particularly important for EU trade, as they shield European industry from the harmful effects of dumped or subsidized imports. The Commission has put in place in the last few years a new defense policy, based on the principles of transparency, engagement with third countries, and effectiveness.
The reports highlights that at the end of 2018 the EU had 93 definitive anti-dumping measures and 12 countervailing measures in force. The total number of trade defense instrument measures in force in other countries affecting EU exports, amounted instead to 174 in 2018 (as compared to 162 in 2017). According to the report, this trend is expected to continue over the next years.
As for the investigative work of the Commission of situations regarding he need of adoption of trade defense measures, that remained at a high level, reaching nearly that of 2017. The work consisted mainly of new investigations under new sets of trade defense investigation rules, as well as of a still significant number of reviews. At the end of 2018, 45 investigations were ongoing, as well as six refund investigations covering 99 refund requests.
According to the report, trade defense measures kept busy also the judicial organs of the EU; the General Court and the Court of Justice rendered 26 judgments in the area, while 15 new cases – against the 20 for 2017 – were filed.
EU Commission to hold a meeting with stakeholders on the establishment of the Multilateral Investment Court on 22 March 201903/03/2019
On 22 March 2019, the EU Commission will hold a meeting with stakeholders on the reform of investor-State dispute settlement (ISDS).
The meeting will focus on the establishment of a fully-fledged two-tiers’ multilateral investment court, the Commission’s proposal for ISDS reform arised out of the TTIP negotiations in 2015.
After the impact assessment process on options for a multilateral reform of the investment dispute settlement system, on 20 March 2018 the Council adopted and published the negotiating directives for the multilateral investment court.
The European Parliament adopts a resolution on the recommendations for opening of trade negotiations between the EU and the US26/02/2019
After that on 19 January 2019 the international trade committee voted in favour of a resolution calling for new talks between the EU and the US to start, the EU Parliament is engaged in an effort to make sure that such relations develop in the framework of the EU values.
Notably, with the input of Mr. Bernd Lange, chair of the international trade committee,the European Parliament has adopted a resolution pointing out that the mentioned negotiations shall not start before the US complies with some of the conditions indicated in the resolution of the the international trade committee of 19 January 2019.
These are specifically that the negotiations exclude agriculture and that the US lifts its tariffs on aluminium and steel.
The Commission will have to take into account the position of the EU Parliament: any deal resulting from these talks has to be approved by the European Parliament before it can enter into force.
The European Commission submitted its draft negotiating mandates to the Council for approval on 18 January. The mandates will authorise the Commission to negotiate with the US on eliminating tariffs on industrial goods and on harmonising conformity assessment.
Parliament will vote on its stance on the mandates in March. EU Council of Ministers is expected to adopt the draft negotiating mandates in the same month. The Commission will start negotiations on the basis of the final mandate.
EU Parliament approves the new European framework for screening of foreign direct investments18/02/2019
On 14 February 2014, the European Parliament has approved the new European framework for screening of foreign direct investments.
The approval follows the political agreement reached on 20 November 2018 by the European Parliament and the Council on the proposal of the Commission for the first comprehensive European Union (EU) framework for the screening of Foreign Direct Investments.
The framework responds to growing concerns in many EU countries that state-owned or state-controlled foreign investors are increasingly acquiring control over high-tech companies and critical infrastructure in Europe.
The framework does not establish EU-level screening nor it harmonizes existing screening mechanisms of the Member States.Rather, it sets up a common legal framework in which such mechanisms can develop. Specifically, among other things, the framework:
1.Lays down minimum requirements for Member States’ FDI screening schemes (judicial protection, non-discrimination, transparency);
2. Will allow the Commission to provide advice to Member States if it considers that a planned or executed investment could have an impact on safety or public order in one or more Member States.
3. Provides for a cooperation mechanism between the Member States and the Commission. Under the framework, Member States should keep each other and the Commission informed of any foreign direct investment that is screened by their national authority. They must also share certain information on request, such as the ownership structure of the foreign investor and the financing method.
The Regulation needs now to be approved by the Council to enter into force.
EU-Japan EPA Enters Into Force01/02/2019
Today the Economic Partnership Agreement (EPA) between the EU and Japan entered into force. As of today, also a large part of another agreement between the two parties – the Strategic Partnership Agreement – becomes provisionally applicable.
The EPA, which represents the outcome of longstanding negotiations started in 2013, addresses several aspects of the commercial relations between Japan and the EU, by for instance:
- Removing customs duties – tariffs on more than 90% of the EU's exports to Japan;
- Safeguarding the geographical indications of numerous EU exports;
- Reducing many non-tariff measures, is so facilitating the access of EU companies to the highly regulated Japanese markets, such as the automotive sector;
- Opening the services sectors;
- Removing a number of access barriers to the market of public procurements in Japan.
The deal also includes a comprehensive chapter on trade and sustainable development and sets the highest standards of labour, safety, environmental and consumer protection.
AG Bot finds that the ICS – the mechanism for the settlement of disputes between investors and States provided in CETA – is compatible with EU law29/01/2019
In his much anticipated opinion rendered today, Advocate General Bot found that the mechanism for the settlement of disputes between investors and States provided for by the free trade agreement between the EU and Canada is compatible with EU law.
The AG’s opinion sparks from the request for an opinion (C-1/17) of the European Court of Justice (“ECJ”) pursuant to Article 218(11) TFEU filed by Belgium on 7 September 2017 regarding the compatibility with EU law of the Investment Court System (“ICS”) provided for by the Comprehensive Economic and Trade Agreement between the EU and Canada (“CETA”). Specifically, Belgium expressed reservations as regards to the effects of that mechanism on the autonomy of EU law, the general principle of equal treatment, the requirement that EU law is effective, and the right of access to an independent and impartial tribunal.
In the opinion of AG Bot, “autonomy” of the EU legal order cannot be understood as autarchy. Indeed, the creation of a common set of rules and standards to regulate the EU relations with third countries calls for the creation of an independent system of protection for investors, both in the EU and on the territory of the Union’s trade partners. This conclusion is also supported by the absence of direct effect of CETA, which excludes that national courts may enforce the safeguards included therein. The AG also draws a comparison – and underlines the differences – between the ICS and the system of investment arbitration, found incompatible by the ECJ in the Achmea judgement (C-284/16): whilst the Court in Achmea was safeguarding the essential principles of mutual trust and loyal cooperation which govern the relationship between the Member States, the ICS does not impinge in such principles.
AG Bot further observes that the ICS would not be able to interpret and apply EU law, it would be unable to order the annulment of EU law measures considered in violation of CETA, and it would be prohibited from ruling on the division of powers between the EU and its Member States. Thus, its structure and functioning safeguard the “autonomy” of EU law. Of particular relevance is the observation that the law applicable by the ICS consists of the provisions of CETA, applied in the light of international law. On those instances where the ICS would be requested to apply EU law, it would be bound by the decisions of the ECJ (CETA, para. 8.31.2).
The AG also concludes that the ICS does not undermine either the application of EU law or the role of national courts to start preliminary references procedures: on the one hand, its jurisdiction does not limit the substantive rights enjoyed by investors in the EU; on the other, the role of national courts “to hear and determine actions brought with a view to ensuring the observance of such rights as are afforded by internal EU law” remains untouched.
Finally, for AG Bot, the ICS affords investors with the right of access to an independent and impartial tribunal as provided under Article 47 of the European Charter of Fundamental Rights. Not only the ICS is only an alternative method of dispute resolution relating to the application of the free trade agreement – which complements the remedies offered by the contracting parties – but also it includes procedural safeguards essential to ensuring the right of access to an independent and impartial tribunal, such as the remuneration of the judges, the rules for their appointment and possible removal, and the specific rules on ethics applicable to them.
EU steps up engagement with Republic of Korea over labour commitments under the trade agreement23/01/2019
On 21 January 2019, the EU has begun government consultations with the Republic of Korea regarding the implementation of the sustainable development commitments under the EU-Korea trade agreement following the formal request issued on 17 December 2018. The EU-Republic of Korea trade agreement, in place since 2011, was the first of the “new generation” comprehensive trade agreements that include a trade and sustainable development chapter, with a number of labour and environmental commitments based on multilateral standards and agreements. The EU-Republic of Korea trade agreement is now in its eighth year of implementation and the EU considers it is time that progress is made and therefore supports the efforts of President Moon to move forward to ratification and legislative changes in this field. The EU has two key longstanding concerns with regard to Korea’s implementation of the commitments on trade and sustainable development: on the one hand, the respect for the International Labour Organisation (ILO) fundamental principles of freedom of association and the right to collective bargaining and, on the other one, the outstanding ratification by Korea of four fundamental ILO Conventions: two concerning freedom of association and the right to collective bargaining and two concerning forced labour.
The EU moves forward efforts at UN on multilateral reform of ISDS21/01/2019
On 18 January 2019, the EU and its Member States submitted two papers to the UN Working Group under the United Nations Commission on International Trade Law (UNCITRAL) on the multilateral reform of ISDS. The first EU paper sets out the EU’s proposal of establishing a permanent multilateral investment court with an appeal mechanism and full-time adjudicators. The EU views this as the only reform option that can effectively respond to all the concerns identified in this UN process as it would:
• enhance the predictability and consistency of decisions and ensure their correctness,
• eliminate the ethical concerns of the current system, and
• effectively address the problems of excessive costs and duration.
The second paper makes proposals for an effective work plan so that the Working Group develops concrete solutions and text proposals to be adopted by the UNCITRAL Commission and ultimately the UN General Assembly. The EU papers are a contribution to a multilateral discussion on ISDS reform with broad and inclusive participation of all countries and stakeholders. The proposals by the EU and its Member States and by other countries will be discussed at the next meeting of the Working Group from 1 to 5 April 2019.
The EU Commission submits two proposals to Uncitral Working Group III regarding the reform of investor-state dispute settlement18/01/2019
Following up on the invitation by the President of the UNCITRAL Working Group III to participating parties of 22 November 2018 to present concrete written proposals regarding the future of investor state dispute settlement, on 18 January 2019 the EU Commission submitted two documents for discussion to the Working Group.
A first document, “Establishing a standing mechanism for the settlement of international investment disputes” sets out the coordinates of a standing mechanism to resolve disputes between investors and states. It also reiterates that a permanent mechanism is the only type of reform which can effectively respond to all the concerns identified in the works of UNCITRAL Working Group III since its first meeting on 27 November-1 December 2017 in New York.
The second document, “Possible work plan for Working Group III” identifies the four practical steps that, in the opinion of the EU, the Working Group should undertake in its future work. These are: 1) Identification and proposal by governments of their preferred reform options; 2) Identification of which of the reform options put forward should be the subject of further work on the part of the Working Group; 3) Discussion and decisions in respect of the priority to be given, the sequencing of the deliberations, the possibility of multiple tracks, coordination with other international organisations and inter-sessional work of the options identified; 4) Development of concrete solutions and text proposals, which could be adopted or endorsed by the UNCITRAL Commission and, ultimately, the General Assembly of the United Nations.
The EU to impose definitive safeguard measures on the import of certain steel products09/01/2019
In response to the US’ adoption of protectionist measures for its steel industry, the EU intends to impose definitive safeguard measures on the import of certain steel products.
In a report notified to the WTO on 2 January 2019, the Commission explains that it intends to apply tariff-rate quota on 26 steel product categories (listed in Annex II of the report) to prevent “serious injury” to the EU steel market.
The adoption of the measures is based on an impact assessment carried out by the Commission, which highlighted the negative consequences that the imposition of the US Section 232 measures is having on the vulnerable EU steel market.
The measures will consist of tariff-rate quota by which a duty of 25% will apply when the level of the traditional trade flows is reached.
The notification to the WTO explains that the measures will be introduced before 4th February 2019, date when the application of provisional measures already in place for those products from 18 July 2018 (G/SG/N/7/EU/1 and G/SG/N/11/EU/1) will expire. The safeguard measures will last for a period of three years (including the period of imposition of the provisional measures), until 16 July 2021.
Not all steel importers will be however affected. The provisional measures should exclude products originating in certain developing countries, which meet the requirements of Article 9 of the WTO Agreement on Safeguards, and, by reason of the high level of market integration, also steel products originating from EEA countries.
EU and Tunesia meet for the 3rd Round of Negotations of the DCFTA21/12/2018
Between 10-14 December, the EU and Tunisia met for the third round of negotiations for a Deep and Comprehensive Free Trade Area (DCFTA). The goal of the DCFTA is to better integrate Tunisia's economy into the EU single market by means of the creation of new trade and investment opportunities. Discussions cover a wide range of issues including agriculture, services, and sustainable development.
The DCFTA will build on the existing EU-Tunisia Association Agreement, entered into force in 1998, which and created a Free Trade Area between the EU and Tunisia, providing for reductions in trade tariffs, rules and disciplines on the use of non-tariff based trade measures such as quotas and product standards, a general right to establish businesses and provide services in the other territory, allow for current payments and movement of capital and common rules on competition and intellectual property.
Tunisia is one of the partners of the Euro-Mediterranean Partnership (Euromed),part of the European Neighbourhood Policy, through which the EU offers its neighbours a privileged relationship, building upon a mutual commitment to common values (including democracy and human rights, rule of law, good governance, market economy principles and sustainable development) essential component in the pursuit of greater economic integration in the Mediterranean region.
EU and Tunisia are also parties to the pan-Euro-Mediterranean cumulation system of origin established in 2005, which brings together the EU, Tunisia and other partners in Europe and the Mediterranean to support regional integration by creating a common system of rules of origin based on the 2011 Regional Convention on pan-Euro-Mediterranean preferential rules of origin.
The EU requests Consultations with South Korea over pursuant to Article 13.14 paragraph 1 of the EU-South Korea Free Trade Agreement18/12/2018
The consultations regard certain measures including provisions of the Korean Trade Union Act and the Korean Criminal Code which would appear to be inconsistent with Korea’s obligations to uphold and promote fundamental rights, including the freedom of association and the effective recognition of the right to collective bargaining, in accordance with the obligations deriving from membership of the ILO and the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up.
The EU also criticizes the inadequateness of Korea’s efforts towards ratifying various ILO Conventions, namely on Freedom of Association and Protection of the Right to Organise Convention, of 1948; on the Right to Organise and Collective Bargaining Convention, of 1949; on Forced Labour Convention, of 1930; and on Abolition of Forced Labour Convention, of 1957.
The consultations request is in line with the EU commitment to creating fair and sustainable economic trade and investment relations, enshrined, among others, in the Commission’s Communication “Trade for All” and recently reinforced in the non-paper on the the 15-Point action plan on trade and sustainable development from February 2018.
The consultations request, whose aim is aim is to open a dedicated channel of communication to find an amicable and mutually satisfactory solution to the EU’s concerns, is the first ever activated in the framework of a EU trade agreement.
EU Proposes Amendments to the Functioning of the WTO Appellate Body28/11/2018
On 26 November, the EU Commission, in synergy with other WTO members (Australia, Canada, China, Iceland, India, Korea, Mexico, New Zealand, Norway, Singapore and Switzerland) has published an amendment proposal to the functioning of the WTO Appellate Body.
The proposal builds upon the EU’s paper on the initial ideas on WTO modernisation and aims at implementing the European Council’s invitation to the Commission to propose a comprehensive approach to improving, together with like-minded partners, the functioning of the WTO in crucial areas, including "more effective and transparent dispute settlement, including the Appellate Body, with a view to ensuring a level playing field." (paragraph 16 of the EU Council’s conclusions of 28 June 2018).
The proposal intends to tackle the main criticisms raised against the WTO Appellate Body, and, in particular:
Transitional rules for outgoing Appellate Body member- The EU proposes an amendment to the DSU to provide that an outgoing Appellate Body member shall complete the disposition of a pending appeal in which a hearing has already taken place during that member's term.
The issue of 90 days- The EU proposes to amend Article 17.5 of the DSU by providing an enhanced consultation and transparency obligation for the Appellate Body. According to the proposa; “the Appellate Body would need to consult with the parties early in appellate proceedings – or before the appeal is filed – if it estimates that the report will be circulated outside 90 days. If there is no agreement of the parties on the exceeding of this timeframe there could be a mechanism pursuant to which the procedure or working arrangements for the particular appeal could be adapted to ensure the meeting of the 90-day timeframe. For example, the Appellate Body could propose to the parties to voluntarily focus the scope of the appeal, set an indicative page limit on the parties' submissions or it could take appropriate measures to reduce the length of its report. This could also include the publication of the report in the language of the appeal only, for the purposes of meeting the 90-day timeframe (the translation to the other WTO languages and formal circulation and adoption would come later).”
The meaning of municipal law as an issue of fact – The EU proposes to amend Article 17.6 of the DSU to clarify that that issues of law covered in the panel report and legal interpretations developed by the panel – as well as the panel's objective assessment according to Article 11 of the DSU - do not include the meaning itself of the municipal measures.
Findings unnecessary for the resolution of the dispute – The EU proposes to amend 17.12 of the DSU to provide that the Appellate Body shall address each of the issues raised on appeal by the parties to the dispute to the extent this is necessary for the resolution of the dispute.
The issue of precedent – The EU proposes to open a further channel of communication between the Appellate Body and WTO Members (in the DSB) in the form of annual meetings where Members could express their views in a manner unrelated to the adoption of particular reports (as laid down currently in Article 17.14 of the DSU).
The proposal will be presented by the EU and co-sponsoring WTO countries to the entire membership at the meeting of the WTO General Council on 12 December.
Commissioner Malmström outlines how the EU is leading the way towards the multilateral reform of the investor-state-dispute-settlement (ISDS) system22/11/2018
In a very well-attended meeting, on 22 November Commissioner for Trade Cecilia Malmström held a speech on the reform of investment dispute settlement.
In her speech, Commissioner Malmström reiterated the commitment of the European Union to build together like-minded partners a multilateral system of rules where trade and investment are a powerful tool for growth and development.
Commissioner Malmström then highlighted the necessity to reform both trade (WTO) and investment (ISDS) dispute settlement to serve this aim.
Commissioner Malmström then affirmed her satisfaction with the progresses made in UNCITRAL on the reform of ISDS, and reiterated that the EU position is that only a multilateral court – such as the one proposed by the EU - can address the pitfalls of a system “designed in the 1960s and based on commercial arbitration – on a system for resolving private commercial disputes, not the public type of disputes which in fact arise”.
EU Commission Publishes the Second Annual Report on the implementation of Free Trade Agreements07/11/2018
The second Annual Report on the implementation of free trade agreements published by the EU Commission on 31st October 2018 is certainly good news for EU trade.
The report covers 35 of the most economically significant EU trade agreements with 62 partners in effect in 2017. As first report published in November 2017 the second Annual Report is meant to increase awareness and transparency on how the Commission implements free trade agreements, in line with the EU Commission’s "Trade for All" Communication.
According to the report, in the relevant period:
- EU exports continue to grow, with a peak 12.2% increase in EU exports overall with South Korea and 7% increase in EU exports to Canada under CETA in only nine months following its entry into force (October 2017 to June 2018)
- The trend is particularly positive with regards to the "new generation" EU trade agreements, in particular for transport equipment like railways and tramways – registering a 108% increase vis-à-vis the previous period - or mineral fuels and oils (51% increase).
- In relation to agri-foods trade, EU exports under comprehensive trade agreements concluded after 2006 increased by 6.2%, a higher rate than EU agrifood exports overall (which increased by 5.1%).
- All EU trade agreements concluded since 2010 include provisions on promoting trade and sustainable development.
EU sends mission to Myanmar to assess the human rights situation on the ground01/11/2018
After having the notification to the Myanmar authorities announced by Trade Commissioner Malmström in early October 2019, on 18-31 October the European Commission and the European External Action Service sent an emergency, high-level EU mission to the country to assess the human rights situation on the ground.
The aim of the mission is declaredly that of assessing the permanence of the condition for the participation of Myanmar in the Everything But Arms (EBA) scheme.
The EBA scheme, stablished by Regulation 978/2012, is part of the Generalised Scheme of Preferences, which includes instruments accompanying developing countries to achieve sustainable development using the economic engines of trade.
Specifically, EBA unilaterally grants full duty-free, quota free access for all products except arms and ammunition to countries classified by the UN as Least Developed Countries.
After a previous suspension, Myanmar was reinstated as an EBA beneficiary in 2013. The EU is, together with the United States, Japan, Denmark and the ILO, also part of the "Initiative to Improve Labour Rights and Practices in Myanmar" designed to promote the compliance with ILO international labour standards and responsible business practices.
In the last few years, Myanmar has widely used the EBA scheme, under which fall 95% of all of Myanmar's EBA-eligible exports to the EU.
The EU is hoping to use its economic leverage under the EBA to push the country to find a long-term solution to the recent very serious humanitarian and human rights situation in Rakhine State.
EU and Indonesia Complete the 6th Round of Negotiations for an FTA24/10/2018
On 22 October the EU and Indonesia completed the 6th round of negotiations for a comprehensive Free Trade Agreement.
The negotiations for a free trade agreement (FTA) between the EU and Indonesia were officially launched on 18 July 2016. The fifth negotiating round took place in Brussels from from 9 to 13 July 2018.
Of particular interest will be whether the Agreement will be divided in an Investment Protection Agreement and a Free Trade Agreement, analogously to Singapore and Vietnam.
A Council’s decision on the point is likely to be the “high level policy decision” referred to in the report of the 5th round of negotiations as a ground to explain the limited discussions held by the two negotiating teams on investment dispute settlement and in particular, the Investment Court System (ICS), transparency and consent.
The Free Trade Agreement will also develop a key aspect of the overall relationship between the EU and Indonesia which is framed by the Partnership and Cooperation Agreement which entered into force on 1 May 2014.
The next round of negotiations is planned for 11 to 15 March 2019 in Brussels.
European Commission adopts the EU-Vietnam Agreementas17/10/2018
The European Commission today adopted the EU-Vietnam trade and investment agreements (Free Trade Agreement and Investment Protection Agreement), the first step for their signature and conclusion.
The EU-Vietnam Free Trade Agreement will eliminate over 99% of all tariffs, and partly remove the rest through limited zero-duty quotas, the “Tariff Rate Quotas” in a way which goes beyond the rules set out in the WTO Technical Barriers to Trade agreement in terms of reduction of non-Tariff barriers. In particular, Vietnam has committed to increasing the use of international standards when drafting its regulations. The agreement also contains a chapter on sanitary and phytosanitary measures, to make trade in plant and animal products easier.
Further, the FTA:
- opens Vietnam’s public procurement market so that EU companies will be able to bid for public contracts with Vietnamese ministries and important state-owned enterprises
- opens the Vietnamese market for EU services providers in sectors like business services; environmental services and banking
- opens Vietnamese investments in manufacturing in key sector such as ceramics and fertilisers
- commits Vietnam to a high level of protection that goes beyond the standards of WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement to protect EU innovations, artworks and brands
Importantly, the EU-Vietnam FTA develops in the framework of the EU-Vietnam Partnership and Cooperation Agreement - which allows measures considered as appropriate in the case of breaches of human rights, including the suspension of the Trade Agreement. It also includes a robust and comprehensive chapter on trade and sustainable development, with an extensive list of commitments.
In terms of dispute settlement mechanisms, the trade mechanism set up in the FTA is faster and more compelling than the WTO system. As for the IPA, the EU-Vietnam agreement includes modern rules on investment protection enforceable through the new Investment Court System, which ensures that the right of the governments on both sides to regulate in the interest of their citizens is preserved.
The Commission is now submitting to the Council the proposals for signature and conclusion of both agreements. Once authorised by the Council, the agreements will be signed and presented to the European Parliament for consent. Once the European Parliament has given its consent, the trade agreement can then be concluded by the Council and enter into force.
The Investment Protection Agreement with Vietnam will be ratified by Member States according to their respective internal procedures.
A busy week ahead for EU leaders15/10/2018
This upcoming week is a busy one for the EU Council and an important one for the future of EU trade.
On 17-18 October heads of state or government will discuss Brexit, migration, internal security, external relations and euro zone reform.
On 18-19 October the 12th Asia-Europe Meeting (ASEM) will address the two topics of connectivity and support for multilateralism under the heading "Europe and Asia: global partners for global challeges.
On 19 October the 9th EU-Republic of Korea summit will focus on bilateral relations, the implementation of the Free Trade Agreement and the denuclearisation of the Korean peninsula.
On 19 October EU and ASEAN leaders meet in Brussels to discuss the future of EU-ASEAN relations and how to reinforce their cooperation.
EU Commission confirms anti-dumping measures on Russian and Ukrainian steel pipes and tubes02/10/2018
In the framework of the EU Anti-Dumping policy, yesterday the Commission adopted a Decision confirming anti-dumping duties on imports of certain seamless pipes and tubes of iron or non-alloy steel originating in Russia and Ukraine for a further period of 5 years.
The Decision follows an Expiry Review initiated by the Commission due to the concerns in the European Union’s relevant industries that the expiration in 2 years’ time of the anti-dumping duties already in place with the two countries may threaten the relevant European market. Indeed, on 30 March 2017 the Defence Committee of the Seamless Steel Tubes Industry of the European Union lodged a request for such an expiry review on behalf of Union producers representing more than 25 %, of the total Union production of certain seamless pipes and tubes. The request was based on the grounds that the expiry of the measures would be likely to result in a continuation of dumping for Ukraine and recurrence of dumping for Russia and recurrence of injury to the Union industry.
The Commission’s Decision confirms the anti-dumping duties on Russia and Ukraine for ampther 5 years. Specifically, the decision is based on the following considerations:
- the continuation of dumping practices in the review investigation period from both countries;
- the significant spare capacities available (combining for more than 800 000 tonnes);
- the attractiveness of the Union market, the Commission concluded that there is a strong likelihood that if measures were allowed to lapse, dumped imports from Ukraine and Russia would respectively continue to increase and recur in significant volumes.
- The still vulnerable position of the Union’s industry, which would make the situation even more difficult should the measures be repealed
The duties range from 24.1% to 35.8% for imports from Russia and from 12.3% to 25.7% for imports from Ukraine.
Mauritania signs the Regional Economic Partnership Agreement (EPA) between West Africa and the EU22/09/2018
On 21 September, Mauritania signed the Regional Economic Partnership Agreement (EPA) between West Africa and the EU, signalling one essential step forward the adoption of the Agreement, which will be open after Nigeria’s ratification.
Economic Partnership Agreements (EPAs) are trade and development agreements negotiated between the EU and African, Caribbean and Pacific (ACP) partners engaged in regional economic integration processes
The EPA also includes the possibility to hold further negotiations on sustainable development, services, investment and other trade-related issues in the future.
Until the adoption of the full regional EPA with West Africa, 'stepping stone' Economic Partnership Agreements with Côte d'Ivoire and Ghana entered into provisional application on 3 September 2016 and 15 December 2016 respectively.
The European Commission and the High Representative of the Union for Foreign Affairs and Security Policy adopt a Joint Communication setting out the EU's vision for a new and comprehensive strategy to better connect Europe and Asia18/09/2018
The European Commission and the High Representative of the Union for Foreign Affairs and Security Policy today adopted a Joint Communication that sets out the EU's vision for a new and comprehensive strategy to better connect Europe and Asia.
This Communication is part of the EU contribution for the 12th Asia-Europe Meeting (ASEM) summit, taking place on 18-19 October 2018 in Brussels, which will offer the opportunity to promote connectivity and advance cooperation with Asian partners. The summit, organised every two years to set out the priorities of the partnership, brings together 53 partners, including the European Union, 30 European countries (28 EU member states, Norway, Switzerland), 21 Asian countries and the ASEAN Secretariat
The Communication builds upon the 2016 EU's Global Strategy which recognised that connectivity requires that the EU steps up its engagement, noting the link between the EU's security and prosperity and the increasing importance of a “connected Asia”.
As for its content, the Communication highlights how the EU strategy to engage with its neighbours and Asian partners to:
- Develop efficient connections and networks between Europe and Asia through priority transport corridors, digital links and energy cooperation at the service of people and respective economies.
- Establish partnerships for connectivity based on commonly agreed rules and standards enabling a better governance of flows of goods, people, capital and services.
- Address the sizeable investment gaps through improved mobilisation of resources, reinforced leveraging of EU’s financial resources and strengthened international partnerships.
To support this strategy, the European Commission has proposed for the next budget of the European Union to increase the European Union's external action budget to €123 billion for the period 2021-2027. This represents an increase of 30% compared to the previous period.
According to the Communication, all EU initiatives will be informed to principles of sustainable, comprehensive and international rules-based connectivity.
The Commission now invites the comments and support on the strategy from all the other Institutions, the Member States, the European Economic and Social Committee, the Committee of the Regions, the European Investment Bank and relevant stakeholder.
The EU and Mercosur negotiating teams meet today10/09/2018
The 34th negotiating round between the teams of EU and Mercosur has started today in Montevideo, Uruguay. The talks will continue until 14 September.
The EU is negotiating a trade deal with the four founding Mercosur states - Argentina, Brazil Paraguay and Uruguay, as part of a broader Association Agreement between the two regions.
The goals of the new EU-Mercosur trade deal is to:
- Remove these barriers and help EU firms – especially smaller ones – to export more
- Strengthen people's rights at work and environmental protection, encourage companies to act responsibly, and uphold high food safety standards
- Protect quality EU food and drink products from imitations
Since these negotiations were resumed in October 2016, the Commission has published a series of reports summarising the progress made during the negotiation rounds, which can be found at this Link.
EU Commission not to renew EU anti-dumping and anti-subsidy measures on solar panels from China.03/09/2018
On Monday 3 September the EU anti-dumping and anti-subsidy measures on solar panels from China adopted for the first time in December 2013 have expired.
The partial interim review of the anti-dumping and countervailing measures applicable to imports of the product carried out by the Commission in 2015, brought to their extension for a period of 18 months.
After a consultation with the Member States and considered the conditions of the solar panels market, the EU Commission has announced that the measures, expiring on September 3, are not to be renewed.
In so doing, the Commission rejected the EU industry’s request for an expiry review investigation.
Gambia signs the Economic Partnership Agreement (EPA) between West Africa and the EU20/08/2018
The aim of the Agreement is to:
- help West Africa to integrate better into the global trading system and will support investment and economic growth in the region.
- increase West African exports to the EU
- stimulate investment and contribute to developing productive capacity, with a positive effect on employment.
This recent development confirms the position of the EU as the most open market for African exports: by means of numerous bilateral and regional agreements, most African countries have fully free access to the EU market.
The EU relationship with African Countries is mostly based on Economic Partnership Agreements, trade and development agreements negotiated between the EU and African, Caribbean and Pacific partners engaged in regional economic integration processes.
CETA Civil Society Forum10/08/2018
In line with its effort of taking into account civil society’s views on the EU trade and investment policy, on 12 September the European Commission will hold in Brussels a Civil Society Forum on CETA.
During the meeting, officials from the European Commission and the Government of Canada will exchange views with the participants on the sustainable development aspects of the Comprehensive Economic Trade Agreement.
The discussion will include the implementation of Chapter 22 (Trade and Sustainable Development), Chapter 23 (Trade and labour) and Chapter 24 (Trade and environment).
The discussion will also be web streamed. The web link will be published shortly here.
Prior registration is essential and can be carried out here until 7th September.
The Commission publishes report and textual proposals from the first round of negotiations with Australia and New Zealand01/08/2018
The Commission has published reports from the first rounds of trade negotiations with Australia and New Zealand, as well as a set of EU text proposals covering 12 negotiating areas presented so far in the talks with Australia and proposals covering 11 negotiating areas presented so far to New Zealand.
Officials from the EU and Australia met in Brussels from 2 to 6 July 2018.
The first round of EU-New Zealand FTA negotiations was held from 16 to 20 July 2018 in Brussels.
Outcome of the meeting between Michael Barnier, European Chief Negotiator for the United Kingdom Exiting the European Union and Dominic Raab, UK Secretary of State for Exiting the EU26/07/2018
The press conference held by Michael Barnier on the outcome of his meeting with Mr Dominic Raab brings much needed clarifications on the step forwards in - and the challenges connected to - the definition of the UK-EU relations after Brexit.
On the future relationship, Mr Bariner was “particularly pleased” with the UK proposals on security and foreign policy and external security.
In contrast, more doubts remain on the future economic relationship.
The common agreed denominator is that both the EU and the UK want an ambitious Free Trade Agreement.
However, Mr Barnier highlighted two main challenges arising out the definition of such an agreement:
1. The EU will not delegate the application of its customs policy and rules, VAT and excise duty collection to the UK, as also suggested in the White Paper adopted by HM Government;
2. The backstop option to avoid a hard border on the island of Ireland remains critical.
A new phase of close friendship and strong trade relations between the United States and the EU25/07/2018
President of the European Commission Jean-Claude Juncker and the US President Donald Trump have announced today a new phase in the Transatlantic relationships.
In a joint statement released shortly after their meeting in Washington today, President Juncker and President Trump declare their commitment to close friendship, strong and equal trade relations, and commitment to global security, prosperity, and fight against terrorism.
Notably, the joint statement does not only list aims but identifies concrete actions, such higher imports of liquefied natural gas of the EU from the United States,
It also declares that a mixed Executive Working Group will be immediately set up to carry out this joint agenda and identify short-term measures to facilitate commercial exchanges and assess existing tariff measures.
What instead seems to remain a statement of principle, is the declaration to “resolve the steel and aluminium tariff issues and retaliatory tariffs”.
Advancements in the EU-Japan relationships11/07/2018
- a decision on the signature of the agreement;
- a decision to request the consent of the European Parliament for the conclusion of the agreement.
The negotiations for the EPA were launched in 2013. The agreement aims at removing trade barriers with Japan by means, among others, of: elimination of customs duties, elimination of non-tariff barriers, and opening of the market of trade in services.
The SPA is a legally binding pact covering not only political dialogue and policy cooperation, but also cooperation on regional and global challenges, including environment and climate change, development policy and disaster relief, and security policy.
In the meanwhile, discussions continue between the EU and Japan on the finalisation of an agreement on investment protection standards and dispute resolution.
On 11 June, the EU Chief Negotiator for investment protection, Maria Martin-Prat, met with the new Japanese Chief Negotiator, the Deputy Assistant Minister, Teiji Hayashi to further discuss he main elements of investment protection. While there is a large degree of convergence on investment protection standards, differences persist between the two sides with regard to the mechanisms of dispute settlement.
EU and Australia complete the first round of trade talks06/07/2018
After the Council of the European Union authorised opening negotiations for a trade agreement between the EU and Australia on 22 May 2018, today the EU and Australia have completed the first round of negotiations.
Negotiators of both parties met in Brussels from 2 to 6 July 2018.
The trade negotiations aim at removing trade barriers (tariff and non-tariff ones) and opening the Australian procurement market to EU firms. The negotiations will also regard provisions on trade and sustainable development.
So far the EU and Australia have been conducting their trade and economic relations under the 2008 EU-Australian Partnership Framework.
The EU launches negotiations for two comprehensive and ambitious trade agreements with Australia and New Zealand.26/06/2018
On 18 and 21 June, Commissioner for Trade Cecilia Malmström met respectively with Australian Prime Minister Malcolm Turnbull and Trade Minister of Australia Steven Ciobo and with New Zealand’s Minister for Trade David Parker to officially launch negotiations for the two comprehensive and ambitious trade agreements with Australia and New Zealand.
The negotiations aim at removing barriers to trade in goods and services, creating opportunities for small and large companies, as well as setting ambitious rules in line with other trade agreements of the EU, contributing to shape global trade.
The first formal round of talks with the Australian negotiating team will take place in Brussels from 2 to 6 July.
The first formal round of talks with the New Zealand negotiating team will take place in Brussels from 16 to 20 July.
EU advances trade talks with Mercosur, Chile, Tunisia and China26/06/2018
The EU’s trade negotiations with Mercosur, Chile, Tunisia and China proceed expeditiously.
The latest round of negotiations with Chile took place in Brussels from 28 May to 1 June 2018. In total, 22 negotiating groups met, which resulted in constructive exchanges and substantive progress in most area. The Commission also publishes today three new text proposals, on animal and plant health, trade and sustainable development, and trade and gender equality. The result of the talks are summarised in this report. The Parties agreed on work in relation to the various areas and contacts will continue with the aim of advancing in all areas in preparation for the next round of negotiations, the date of which has yet to be confirmed.
The second round of negotiations for an agreement on a EU-Tunisia Deep and Comprehensive Free Trade Area (DCFTA) was held in Tunis from 28 to 31 May. A third full round is expected to take place in the autumn in Brussels. The negotiating teams met jointly representatives of civil society including from trade unions, employers organisations and non-governmental organisations to discuss how they see the opportunities and challenges of a future DCFTA. A report of the negotiations will be published on the EU Trade website shortly.
The XXXIIIrd negotiation round of the Trade Part of the EU-Mercosur Association Agreement took place from 4 to 8 June in Montevideo, Uruguay. Negotiations covered the following areas: (1) Trade in Goods; (2) Wines and Spirits; (3) Rules of Origin; (4) Technical Barriers to Trade; (5) Sanitary and Phytosanitary Measures; (6) Services and Establishment; (7) Government Procurement; (8) Intellectual Property (including Geographical Indications), and (9) SMEs. Both texts on disciplines and market access were discussed. The summary report of the negotiations is accessible here.
On 25 June EU and China held in Beijing the 7th annual EU-China High-level Economic and Trade Dialogue Both sides agreed to exchange market access offers at the upcoming Summit to give political impetus to an ambitious EU-China Comprehensive Agreement on Investment, both in terms of investment liberalisation and protection. China confirmed its commitment to acceding to the WTO Government Procurement Agreement (GPA).
The EU retaliates to US tariffs on iron and steel by endorsing rebalancing duties on US imports06/06/2018
As a response to the US tariffs on iron and steel imports, which affect the EU and its Member States from 1 June, the College of Commissioners endorsed today the decision to impose additional duties on US products valued at up to €2.8 billion of trade.
The Commission has announced that the remaining rebalancing duties on trade (valued at €3.6 billion against the loss of EU exports worth €6.4 billion) will take place at a later stage – in three years' time or after a positive finding in WTO dispute settlement if that should come sooner.
The full list of affected products has already been notified to the WTO and includes various products, ranging from tobacco to wishy and peanut butter.
The EU and Canada have also requested WTO consultations with the US. In their separate filings, they both claim that the US tariffs are inconsistent with the WTO's GATT 1994 and the Agreement on Safeguards.
The EU to take action against the US decision to lift the exemption from the steel and aluminium imports tariffs31/05/2018
Wilbur Ross, the US Commerce Secretary, has announced that the US will lift the exemptions from the steel and aluminium tariffs granted to the EU, Canada and Mexico on 7 March. According to Mr Ross, insufficient progress has been made in talks with allies to reduce America’s trade deficit during the last months.
The exemptions from the tariff of 25 per cent on steel and 10 per cent on imported aluminium, imposed on the basis of national security interests will thus expire at midnight 1 June Washington time
After meeting jointly with US trade representative Robert Lighthizer to discuss how to tackle China’s steel overcapacity and other issues, EU trade commissioner Cecilia Malmstrom and Japan’s Hiroshige Seko warned that the tariffs move was unjustified.
The EU Commission and many Member State leaders harshly criticised the US administration’s move.
Specifically, the President of the EU Commission, Mr Juncker, stated that the US now leaves the EU “with no choice but to proceed with a WTO dispute settlement case and with the imposition of additional duties on a number of imports from the US”. He then added that “we will defend the Union's interests, in full compliance with international trade law."
The College of Commissioners, which met today, gave the political endorsement to the proposal presented by President Jean-Claude Juncker, Vice-President Jyrki Katainen and Commissioner for Trade Cecilia Malmström for “legal and proportionate” reactions.
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The Council authorises the Commission to open trade negotiations with Australia and New Zealand22/05/2018
The Council today authorised the Commission to open trade negotiations with Australia and New Zealand and adopted negotiating directives for each of the negotiations.
The recommendations to the Council to launch negotiations for these trade agreements, together with the respective draft negotiating directives, were presented by the European Commission on 13 September.
The directives aim primarily at further reducing existing barriers to trade, removing customs duties on goods, and giving better access for services and public procurement in Australia and New Zealand.
Both trade agreements will promote sustainable development through trade-related provisions on labour and environment. Indeed, in welcoming such directives, the President of the EU Commission, Mr Jean Claude Junker, stressed that the two agreements will build on recent successful agreements such as those with Canada, Japan, “expanding the alliance of partners committed to open and rules-based global trade.”
The WTO issues a compliance panel report on the Airbus saga15/05/2018
Today, the World Trade Organization (WTO) issued a compliance panel report on the Airbus saga between the EU and the US
The case, brought in 2004, relates to the subsidization of Airbus by France, Germany, Spain, and the United Kingdom for the development and production of its series of large civil aircraft programmes. According to the request for consultations from the United States, measures by the EC and the member States provide subsidies that are inconsistent with their obligations under the SCM Agreement and GATT 1994.
The case was concluded with a first decision of the Appellate Body in 2011, which essentially concluded that Europe had indeed subsidized Airbus from 1968 through 2006. The US subsequently (30 March 2012) the United States requested the establishment of a compliance panel.
In its decision on compliance today, the WTO appeals panel agreed with earlier findings that the European repayable launch investment loans do not constitute a prohibited subsidy, it ruled that Europe needs to make modifications and correct errors related to the A350 and A380.
However, the WTO rejected 94% of 218 claims of “adverse effects” such as lost sales, restricting those to only the A350XWB and A380.
Welcoming the decision, Commissioner Malmström declared that the EU will now “take swift action to bring itself into line with WTO rules as regards its remaining obligations.”
The EU Commission insists that it should be permanently excluded from import duties after the US announces that the EU will be exempt from the steel and aluminium tariffs only until 1 June08/05/2018
The European Commission criticized the US Government’s decision of merely delaying the imposition of steel and aluminium tariffs imposed under Section 232 of the Trade Expansion Act of 1962 until June 1 rather than cancelling the duties outright.
In a statement released today, the EU executive condemns as “unjustified” this one-month temporary exemption from steel and aluminium tariffs granted by US President Trump to its “allies” Canada, Mexico and the European Union.
The statement highlights that “Overcapacity in the steel and aluminium sectors does not originate in the EU” and that, contrarily, the EU is actively engaged “at all possible levels with the US and other partners to find a solution to this issue.”
Among these, notably features the trilateral cooperation with Japan and the US launched at the sidelines of the World Trade Organisation Ministerial in December of last year.
The Council adopts conclusions on the negotiation and conclusion of EU trade agreements08/05/2018
Today, the Council adopted conclusions on the negotiation and conclusion of EU trade agreements.
The conclusions represent a reaction to the Commission declared intention to adopt recommend, as a result of the opinion of the European Court of Justice 2/15 on the division of competencies between the Union and its Member States for the conclusion of the EU Singapore FTA, draft negotiating directives for FTAs covering exclusive EU competence and separate mixed investment agreements.
The document sets out the key principles that will underpin the Council's approach towards trade negotiations from now on.
To begin with, the Council stresses that decisions on signature and conclusion of trade and investment agreement are taken by the Council, who will decide, on a case-by-case basis, on their splitting. According to the Council, this requirement is necessary to allow Member States' governments to consult their national parliaments and other stakeholders.
The Council also adds that, depending on their content, association agreements should be mixed. The ones that are currently being negotiated, such as with Mexico, Mercosur and Chile, will remain mixed agreements.
As for EU investment agreements, these should “in principle be negotiated in parallel to FTAs.”
The Council is also declaredly considering the separate agreements on trade and investment with Singapore, as proposed by the Commission, with a view to adopting the decisions on their signature as soon as possible.
Finally, in this decision, the Council declares that, whilst respecting the voting rules applicable under the Treaties, the Council will continue endeavouring to obtain to the greatest extent possible a consensus in order to ensure that all Member States' interests and concerns are adequately respected in trade agreements.
The EU and Japan continue negotiations on investment protection standards and dispute resolution26/04/2018
After presenting to the Council the outcome of the negotiations for the EU-Japan Economic Partnership Agreement finalised in December last year, on 26 April 2018 the EU Commission - in the person of the Chief Negotiator for investment protection Maria Martin-Prat - met with Japanese representatives to further discuss investment protection standards and dispute resolution.
The firm commitment on both sides is to move towards an agreement in the investment protection negotiations as soon as possible, in light of the shared commitment to a stable and secure investment environment in Europe and Japan.
More specifically, during these negotiations the EU has tabled to Japan its reformed proposal on the Investment Court System. For the EU, it is clear that there can be no return to the old-style Investor to State Dispute Settlement System (ISDS).
European Commission proposes signature and conclusion of Japan and Singapore agreements18/04/2018
Today the Commission has presented the outcome of negotiations for the Economic Partnership Agreement with Japan and the trade and investment agreements with Singapore to the Council for their signature and conclusion.
The proposal for a Council Decision on the signing, on behalf of the European Union, of the Economic Partnership Agreement between the European Union and Japan comes after the finalisation on 8 December 2017 of the negotiations between the two parties. In parallel to the EPA, the EU and Japan are also negotiating a Strategic Partnership Agreement, a legally binding pact covering not only political dialogue and policy cooperation, but also cooperation on regional and global challenges, including environment and climate change, development policy and disaster relief, and security policy.
The proposal for a Council Decision on the signing, on behalf of the European Union, of the Free Trade Agreement between the European Union and the Republic of Singapore brings about some modifications to the text of the Agreement finalised by the parties in October 2014 to take into account the outcome of European Court of Justice’s Opinion no. 2/15, delivered on 21 December 2016.
In view of the Court’s Opinion, and in light of the wide-ranging discussions on the architecture with the Council and the European Parliament following the Opinion, the initially negotiated text has been adjusted to create two self-standing agreements: a Free Trade Agreement (FTA) and an Investment Protection Agreement (IPA).
In view of the division of competences between the EU and its Member States set by the Court in Opinion 2/15, all the areas covered by the EU-Singapore FTA fall within the competence of the EU and, more particularly, within the scope of Articles 91, 100(2) and 207 TFEU. All substantive provisions on investment protection under the IPA, to the extent that these apply to foreign direct investment, are covered under Article 207 TFEU. The EU-Singapore FTA is thus to be signed by the Union pursuant to a decision of the Council based on Article 218(5) TFEU and concluded by the Union pursuant to a decision of the Council based on Article 218(6) TFEU, following the European Parliament’s consent. The EU-Singapore IPA is to be signed by the Union pursuant to a decision of the Council based on Article 218(5) TFEU and concluded by the Union pursuant to a decision of the Council based on Article 218(6) TFEU, following the European Parliament’s consent and ratification by the Member States in accordance with their respective internal procedures.
Another notable innovation of the EU-SingaporeAgreement post-Opinion 2/15 is the replacement in the IPA of the Investor State Dispute Settlement (ISDS) system with a standing international and fully independent dispute resolution system, consisting of permanent First Instance and Appeal Tribunals that will conduct dispute settlement proceedings in a transparent and impartial manner.
EU Commission to hold an event on Decent Work, Corporate Responsibility and the EU-Central America Association Agreement11/04/2018
On 16 and 17 May 2018 the European Commission will hold an event on Decent Work, Corporate Responsibility and the EU-Central America Association Agreement.
The event of May 16-17 is part of the commitments included in the Agreement to provide a framework for open dialogue on trade and sustainable development aspects relating to the implementation of the Trade and Sustainable Development Title in relations between the parties themselves. The trade pillar of the EU-Central America Association Agreement includes a Trade and Sustainable Development Title, covering the parties’ commitments on labour and environment-related matters. These commitments include, amongst other things, implementation of the fundamental conventions of the International Labour Organization (ILO), multilateral environmental agreements such as the Convention on Biological Diversity, the UN Framework Convention on Climate Change and the Convention on International Trade in Endangered Species of Wild Flora and Fauna (CITES).
Building on the UN 2030 Agenda for Sustainable Development, the event on Decent Work, Corporate Responsibility thus aims at fostering the dialogue among business and civil society, policymakers and international organisations to discuss international guidelines and best practices on responsible business conduct and their contribution to SDG8, the role of government in supporting contributions of the private sector to SDG8 as well as best practices in the textile and sugar sectors.
The event will be held in Guatemala City, Guatemala. Further details and information on the registration will be posted on this page.
Council publishes negotiating directives for a multilateral investment court20/03/2018
The Council published today the negotiating directives for a multilateral investment court.
The court, proposed for the first time by the Commission in the negotiations for the TTIP, is a tool to move away from the system of ad hoc arbitration set up in most Investment Agreements and lay down a more transparent, coherent and fair dispute settlement system to deal with investor complaints.
In the directives, the Council also mandated the Commission to strive to achieve the greatest level of transparency in the negotiations for the multilateral court with the other interested parties, in order to ensure the broadest possible participation in the discussion to the civil society.
EU Commission to hold Stakeholder meeting on the establishment of a multilateral investment court12/03/2018
On Friday 13 April 2018, from 10:00 to 12:00, the European Commission will hold a stakeholder meeting on the multilateral reform of investment dispute resolution including the establishment of a multilateral investment court.
The Multilateral Investment Court proposed by the Commission, and now included in CETA, is a permanent body to decide investment disputes, which represents a major departure from the ad hoc arbitral system of investor-to-State dispute settlement (ISDS). The idea of a full-fledged two-tier court to deal with investor-state disputes under investment Treaty is also being discussed by the UNCITRAL III Working Group. The submission made to the Group by the EU can be found here.
In view of establishing an ever-closer cooperation between the Institutions and the civil society, at the meeting the Commission will update stakeholders on the latest developments in this area at the EU and international level and exchange views on the latest relevant EU policy developments.
To participate, register at this link before Friday 6 April.
Commission unveils a 15 steps plan to further the implementation and enforcement of Trade and Sustainable Development chapters in EU Free Trade Agreements01/03/2018
On 27 February 2018, Trade Commissioner Malmström presented a non-paper outlining 15 actions points to improve Trade and Sustainable Development (TSD) chapters in EU Free Trade Agreements (FTAs).
The document collects the results of an eight-months debate with the Institutions, the Member States and the civil society started by the Commission in July 2017.
In the paper, the Commission developed a set of 15 concrete and practicable actions to be taken to revamp the TSD chapters, building on recommendations received and categorised under four broad headings:
A.Working Together – Through the following actions: 1. Partnering with Member States and the European Parliament and 2. Working with international organisations;
B.Enabling and civil society including the Social Partners to play a greater role in implementation – By: 3. Facilitating the monitoring role of civil society including the Social Partners; 4. Extending the scope for civil society, including the Social Partners, to the whole FTA; 5. Taking action regarding responsible business conduct;
C.Delivering – 6. Country priorities; 7. Assertive enforcement; 8. Encourage early ratification of core international agreements; 9. Reviewing the TSD implementation effectiveness; 10. Handbook for implementation; 11. Step up resources; 12. Climate action; 13. Trade and labour;
D.Transparency and Communication – With: 14. More transparency and better communication, and 15. Time-bound response to TSD submissions.
In the view of the Commission, this list is however not exhaustive: further actions and other measures could also be taken depending on the necessity or the actual case. In this view, the Commission sees continuous engagement with Member States, the European Parliament, interested stakeholders and the public as a crucial action to continuously analyse the effectiveness of the implementation of the TSD chapters (e.g. through review clauses; annual FTA implementation reports; ex-post impact assessments).
The importance of implementing these actions to reach the full potential of trade not as a “weapon of intimidation” but rather as an instrument of growth good for “stakeholders, […] consumers, employees, the communities they work in and the environment” was also reaffirmed by Trade Commissioner Malmström during her address at Amfori on March 12, 2018.
The paper is part of the broader EU Sustainable Development Strategy which aims to identify and develop actions to enable the EU to achieve a continuous long-term improvement of quality of life through the creation of sustainable communities able to manage and use resources efficiently.
The new CPTPP text released21/02/2018
Yesterday, the eleven states parties to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) have released the text of their new agreement, expected to be ratified by March.
However, it still includes some notable changes, especially with regards to Investor-State Dispute Settlement (ISDS).
This agreement between the sc. TPP11 constitutes an interesting development for the EU: it not only is expressly open to ratification to "any State or separate customs territory", but also it constitutes yet another reinforcement (together with ASEAN and RCEP) of the Asian region as a powerful standard-setter in international trade and investment.
The Commission publishes a report on the outcome of the second round of renegotiations of the existing EU-Chile Association Agreement10/02/2018
After the conclusion of the second round of negotiations with Chile for the modernisation of the existing Association Agreement, last February 6 the Commission published a report on the results achieved, as well as all negotiating textual proposals.
Overall, all seventeen negotiating groups that met on15-18 January m ade good progress.
Among other things, the parties exchanged preliminary views on the overall architecture of the future investment chapter, which, in the EU proposal, should also include access to the negotiating Investment Court System.
First meeting of the new EU Commission's expert group on EU trade agreements01/02/2018
The initiative of setting up the Group is part of the European Commission’ broader aim to have a transparent and accountable trade policy based on consultations with all parts of European civil society.
The number of participants to the Group and the variety of their backgrounds is intended to foster in-depth dialogue on trade in the EU and engage with the Commission in a discussion on old and new issues in the field, including the proposed multilateral Investment Court, e-commerce, trade and gender, trade and consumers, and provisions in trade agreements for smaller and medium-sized firms.
The Commission believes that the Group’s input will help it in its ongoing efforts to both ensuring that EU trade policy is state-of-the-art and progressive, and establishing a closer link with the needs and concerns of the civil society at the national level.
Council publishes the mandate given to the Commission to modernise the existing association agreement with Chile24/01/2018
The update of the EU-Chile relations, launched on November 16, 2017, aims at deepening the relations between the block and the South American country by enhancing existing cooperation on political, security and trade matters.
The publication of the Council of the EU’s mandate is especially important in terms of the Commission-led commitment to greater transparency of the EU in its external relations, by reason of the mixed political and economic nature of the Agreement.
Indeed, such decision constitutes a first-of-its-kind, as never before the Council had made public the entire negotiating mandate for this kind of agreements.
The decision has been applauded by the Commission. In particular, Trade Commissioner Malmström underlined the crucial role of transparency to gain EU citizens’ trust in the work of the Institutions.
The European Commission and the European External Action Service publish report on the impact of the Generalised Scheme of Preferences for the period 2016-201719/01/2018
The EU Commission and the European External Action Service published today a report and a detailed accompanying document on the impact of the Generalised Scheme of Preferences (GSP) for the period 2016-2017.
The GSP - which entered into force in 2014 - is the EU's main trade instrument to support developing countries to achieve sustainable development using the economic engines of trade. As a tool for the promotion of universal values of human rights, social justice and environmental protection, the GSP is an integral part of the Commission's "Trade for All" strategy.
The GSP consists of three different arrangements that grant to developing countries privileged access to the EU market (Standard GSP, GSP+, or Special Incentive Arrangement for Sustainable Development and Good Governance and EBA - Everything But Arms). The idea is that, by having a privileged access to the single market, the developing countries party to the GPA have the opportunity generate additional revenues via international trade that can help reducing poverty and promoting sustainable development, human rights and good governance.
The report highlights an overall positive impact of the GSP on developing countries, both in economic and non economic terms. Since its entry into force, exports from countries to the EU benefitting from these tariff cuts rose by nearly a quarter to a yearly amount of Euro 63 billion. Least developed countries benefited the most: their exports to the EU increased by nearly 40% and reached €23.5 billion in 2016.The report also points out the progress made on issues such as women’s empowerment, child and forced labour, torture, illegal drugs trafficking and climate change.
The documents published today also address the shortcomings that still need to be tackled to reach the aims of the GSP, which include the implementation and enforcement of the relevant legislation by the countries benefiting of the scheme.
The EU Commission discusses with civil society the outcome of the debriefing on the WTO 11th Ministerial Conference and the way forward for the EU11/01/2018
On January 24 the European Commission will hold a meeting with civil society on the unsuccessful outcome of the 11th WTO Ministerial Conference, which took place in Buenos Aires, from 10 to 13 December 2017.
The meeting aims at a views’ exchange between the Commission and the civil society on the WTO Conference, which will also help the European Institution delineate its position in the ongoing discussions with other WTO Members on the way forward for the WTO.
To register for the meeting and for the provisional list of the organisations that have registered to participate, follow this link.
Commission publishes the list of representative organisations composing the Group of Experts on EU Trade Agreements22/12/2017
Further to the Commission decision of September 13, 2017 and the implementing public call for applications, the Commission has published the list of associations composing the Group of Experts on EU Trade Agreements.
The Group brings together representative organisations with expertise in economic, social, ethical and/or environmental aspects of EU trade policy.
The Experts will support the European Commission in the negotiation and in the implementation of trade agreements, shedding light on the different perspectives the stakeholders they represent may take on certain issues, and providing feedback on the perception and public debate on trade agreements across EU Member States, also bringing to the attention of the Commission issues that may require particular attention.
The appointment of the list of experts implements the aims set in the Commission Communication "Trade for all: Towards a more responsible trade and investment policy" of October 2015, which highlights the importance of crafting the EU's trade policy in a transparent and inclusive manner, also by the involvement of civil society.
A precedent in this form of dialogue with stakeoholders' associations and civil society was constituted by the informal TTIP Advisory Group, convened from 2014 to January 2017.
The first meeting of the Group is foreseen for January 2018. On that occasion, the Group will discuss and adopt its own rules of procedure.
Regulation (EU) 2017/2321 on trade defence measures enters into force and the Commission publishes the first implementing report on distortions in China20/12/2017
Today enters into force the recently adopted Regulation (EU) 2017/2321, strengthening the European legislation on antidumping and subsidies imports from countries not members of the European Union (see press release).
The Regulation constitutes a key element of President Juncker's agenda on A Europe That Protects.
The main change brought about by the Regulation the calculation of the anti-dumping on imports from all countries part of the World Trade Organisation (WTO) members. The effect of the Regulation will be the (legal) imposition of higher duties for those WTO countries whose imported products’ prices and costs are distorted because of State intervention.
The eimposition of higher duties will be based on the verification of “significant distortions” by means of Commission’s reports. According to Regulation (EU) 2017/2321, factors to be taken into account to determine such significant distortions are, for instance, State presence in firms allowing the state to interfere with respect to prices or costs, State policies discriminating in favour of national enterprises or social and environmental factors which allow the undue cut of production costs (eg. distortion of wage costs) in the representative source country.
In accordance with such regulation, the European Commission also published the first country report on State induced distortions, regarding the Chinese market.
The choice of the country is to be read in the context of the WTO dispute between China, the US and the EU on the calculation methodologies used by the US and EU in anti-dumping proceedings and the opposition by the EU (supported by the US and Japan) to the recognition of the Chinese economy as “market-economy” in the context of the WTO.
The next country report will concern Russia.
The EU, Japan and the United States announce a trilateral joint coordinated action on market-distorting measures by third countries13/12/2017
On December 12, in occasion of the 11th WTO Ministerial Meeting, the EU Trade Commissioner, the Japanese Minister of Economy, Trade and Industry, and the US Trade Representative issued a joint declaration at on their commitment to enhancing close cooperation to achieve a global level playing field in global trade.
In the statement the trade representatives severely condemned market distorting protectionist practices in key sectors (eg. steel) identified in “deep excess capacity exacerbated by government-financed and supported capacity expansion, and unfair competitive conditions caused by large market-distorting subsidies and state-owned enterprises”.
The statement is to be read as an opposition by the US, the EU and Japan to China's demand to be seen as a "market economy" by the WTO, by reason of its practice to provide market-distorting subsidies to national operators and industries.
China has recently sued the EU on the non-recognition of its economy as a “market economy”, maintaining the absence of any generally recognised such definition.
The EU and Japan have finalised Economic and Partnership Agreement08/12/2017
Today the Union and Japan have confirmed the conclusion of the negotiation of the Economic Partnership Agreement (EPA). Based on the political agreement in principle reached during the EU-Japan Summit on 6 July 2017, the EU-Japan EPA represents the biggest bilateral trade agreement ever negotiated by the Union.
The key elements of the EPA are highlighted here.
With todays' announcement the legal verification of the text by the two contracting parties has started. Once this exercise is completed, the English text of the EPA will be translated into the other official languages of the Union. Then, the Commission will submit the agreement for the approval of the European Parliament and EU MSs.
The EU and Japan will continue working on investments' protection, a chapter which is not included in the new EPA.
Case C‑600/14: mixity in the European Union's Free Trade Agreements06/12/2017
With its judgment in case C-600/14, rendered this morning, the Grand Chamber of the ECJ has substantiated the Court's decision on the Singapore Opinion (Opinion 2/15), excluding that findings of shared competence render mixity mandatory.
The EU judges have first recalled that the Treaties distinguish between the Union having an external competence (216(1) TFEU) and the exclusive or shared nature of such competence (Article 3(2) TFEU). The Union may, thus, well have an external competence that falls outside the situations laid down in the Article 3(2) TFEU.
The ECJ then substantiated its position on mixity adopted in Opinion 2/15, where it found that non-direct foreign investment provisions (shared competence of the EU and MS), could not be approved by the Union alone. The Court specified that such finding was purely circumstantial, as it did no more than mirroring “the fact that, as stated by the Council [...], there was no possibility of the required majority being obtained within the Council for the Union to be able to exercise alone the external competence that it shares with the Member States in this area”.
The text of the ruling can be found here.
EU Commission's upcoming appointments with civil society20/11/2017
In compliance with its committment towards an enhanced level of transparency in the field of international trade, in the next few days the European Commission has two meetings lined up with civil society.
On November 27, the EU Commission will exchange views with representatives of civil society on the EU's position and proposals for the 11th WTO Ministerial Conference, to will be held in Buenos Aires in December 2017.
On December 15, the EU Commission will debrief civil society organisations on the status of the EU-Indonesia trade negotiations and exchange views on the topic. For more information and to register for the event, visit this link.
The EU Commission to hold a stakeholder meeting on the multilateral reform of investment dispute resolution and the possible establishment of a multilateral investment court.03/11/2017
The meeting aims at exchanging views on the topic with all interested individuals and entities.
The event will be held in Brussels, Lord Jenkins room, Charlemagne building, Rue de la Loi 170, from 14:30 to 17:30.
Registration is available until November 17 via this Link.
The event will also be livestreamed. The link will be available here.
European Parliament resolution of 26 October 2017 containing the Parliament’s recommendation to the Council on the proposed negotiating mandate for trade negotiations with Australia26/10/2017
In a resolution adopted on 26 October 2017, the European Parliament welcomed the negotiations with Australia but requested the inclusion of some aspects in the negotiating directive. It called for the respect of EU's consumer protection standards and for the negotiation of chapters on micro-enterprises and SMEs, on sustainable development, on agriculture and fisheriers. On this last point, the protection of sensitive products and sectors through, for instance, the introduction of tariff-rate quotas or their exclusion from trade liberalisation measures should be considered. Moreover, no provision should prevent EU governments from legislating to protect health, safety of the environment or require them to privatise public services. Finally, the EP suggested to adopt provisions allowing for the full functioning of the digital ecosystem and promoting cross-border data flows in full compliance with EU's data protection and privacy rules. In compliance with CJEU's Opinion 2/15, a separate deal on investments should be concluded.
European Parliament resolution of 26 October 2017 containing the Parliament’s recommendation to the Council on the proposed negotiating mandate for trade negotiations with New Zealand26/10/2017
In a resolution of 26 October 2017, the European Parliament welcomed the negotiations with New Zealand as sensitive country to sustainable environmental policies, but recommended to negotiate chapters on micro-enterprises and SMEs, on sustainable development and on agriculture and fisheries to avoid using the latter as a leverage to increase access to the New Zealand market. Commitments on the respect of the EU's consumer protection standards and of the welfare of farm and wild animals should also be undertaken. No provision should prevent EU States from legislating to defend health, safety of the environemnt or require them to privatise public services. Moreover, EU businesses should have new opportunities to win contracts with public authorities. Provisions allowing for the promotion of the digital system and cross-border data flows according to the EU's data protection and privacy rules should be adopted. In compliance with CJEU's Opinion 2/15, separate deal on investments should be concluded.
EU Commission publishes text proposals and progress report on the advancements achieved in the 5th round of negotiations on the modernization of the EU-Mexico Global Agreement16/10/2017
The 5th round of negotiations for the modernisation of the EU-Mexico Global Agreement led to substantive advancements in most areas and negotiation groups.
According to the report, constructive outcomes were reached, among others, with regards to sustainable development, transparency and investment protection.
Opposingly, negotiations stall on investment dispute resolution. According to the published negotiating text, the EU is pushing for the creation of an Investment Court on the model of CETA.
EU Trade Commissioner Malmström calls for ambition in next week's WTO meeting in Marrakech09/10/2017
In view of next week's WTO meeting in Marrakech, of preparation for the December's formal gathering in Argentina, EU Trade Commissioner Cecilia Malmström called for ambition in this turn of negotiations.
After re-stating the EU's continuous support for the work of the WTO, Malmström invited the other WTO partners to constructively engaging on various proposals put forward by the EU in view of reaching substantive outcomes in several key negotiation areas.
Among these proposals, the EU also supports further discussion on investment facilitation in the WTO.
More information on the EU proposals at this link.
Tomorrow EU Trade Commissioner Cecilia Malmström will meet civil society to discuss Trade and Sustainable Development in the EU's FTAs05/10/2017
With a view to improving the implementation of Trade and Sustainable Development (TSD) chapters in the EU's free trade agreements, tomorrow Commissioner Malmström will present current developments and exchange views with civil society organisations on Trade and Sustainable Development.
The meeting is part of the broader discussions undertaken by the Commission with the Council, EP and stakeholders to ensure that commitments in bilateral trade and investment agreements in such areas as trade, labour standards, climate and environment protection are respected.
The discussion will be based on the non-paper made available on the website of the Directorate-General for Trade (DG Trade) on 11 July 2017.
The meeting will be recorded and web-streamed through this link.
EU and Mexico successfully conclude the fifth round of negotiations for the modernization of the 1997 EU-Mexico Global Agreement02/10/2017
On October 2, 2017, the Commission announced the successful conclusion of the 5th round of negotiations with Mexico for the revision of the 1997 EU-Mexico Global Agreement.
The agreement includes trade rules that were later developed into the current comprehensive Free Trade Agreement that entered into force in October 2000.
The sixth round of negotiations will take place in Mexico City from 25 November to 1 December.
The negotiating parties aim at concluding a highly ambitious agreement by the end of the year.
The EU negotiating proposals are available at this link.
Intra-EU BIT considered compatible with EU Law by AG Wathelet in the Achmea case19/09/2017
In his Opinion in Case C-284/16 (Slovak Republic v Achmea BV), AG Wathelet maintains that the arbitration clause in the investment protection agreement concluded between the Netherlands and Slovakia is compatible with EU law.
In what can be rightly be described as a paramount opinion on the issue of intra-EU BITs, the AG argues that:
The disputed arbitration clause does not constitute discrimination on grounds of nationality prohibited by EU law;
The arbitration system does not fall outside the scope of the preliminary ruling mechanism established by Article 267 TFEU and is, therefore, compatible with that article;
In any case, Article 344 TFEU applies only to disputes between Member States or between Member States and the Union.
EU-Japan trade negotiating directives made public14/09/2017
After the call for a more transparent and inclusive trade policy for the EU made yesterday by Jean-Claude Juncker during the State of the Union Address, the Council published today the2012 directives given to the Commission to negotiate a trade agreement with Japan.
The EU Commission publishes its recommendations for a Council Decision authorizing the opening of for a Convention establishing a multilateral court for the settlement of investment disputes, as well as for the negotiations for 2 Free Trade Agreements13/09/2017
In line with its efforts to ensure the greatest possible transparency of the EU's activity in the field of international trade, the EU Commission has published 3 recommendations for Council decisions authorizing the opening of negotiations for a Convention establishing a multilateral court for the settlement of investment disputes, as well as for the 2 Free Trade Agreements with Australia and New Zealand.
The latest Eurobarometer survey shows Europeans want the EU to do more in economy and foreign policy11/09/2017
Belgium submits request for an opinion on CETA's compatibility with EU Treaties06/09/2017
Deputy Prime Minister and Minister of Foreign Affairs Didier Reynders submits Belgium’s request for an opinion on the compatibility of the Investment Court System (ICS) with the European Treaties to the Court of Justice of the European Union. The ICS is the reformed system of dispute settlement between States and investors, that was introduced in the EU-Canada Comprehensive Economic and Trade Agreement (CETA).
Pursuant to the request, the ECJ will have to assess the compatibility of the CETA ICS with:
the exclusive competence of the ECJ to ensure the definitive interpretation of European Union law;
the EU general principle of equality;
the right of access to the courts; and
the right to an independent and impartial judiciary.
Should the ECJ establish the incompatibility of the Agreement with EU law, the EU will be prevented from concluding that Agreement with Canada.
When fundamental rights shape the external relations of the EU: The ECJ's opinion on the PNR agreement with Canada.26/07/2017
The ECJ declares that the PNR agreement with Canada at its current state cannot be concluded by the Union as some of its provisions are incompatible with EU fundamental rights.
The full text of the decision at this link.
UN agrees to start work on multilateral reform of investment dispute settlement12/07/2017
On 10 July 2017, the United Nations Commission on International Trade Law (UNCITRAL) agreed that further work should be carried out in this forum on the issue of a multilateral reform of investment dispute settlement.
More information on the EU Commission website.
EU and Japan reach agreement in principle on Economic Partnership Agreement06/07/2017
The European Union and Japan have reached today an agreement in principle on the main elements of an EU-Japan Economic Partnership Agreement. The Agreement covers a number of areas, from agricultural exports to services markets, in particular, financial services, e-commerce, telecommunications, and transport.
The Agreement marks another fundamental step for a more open and fair global trading system. However, some chapters of fundamental importance, such as investment, remain for the momento outside its scope.
EP's Resolution on the implementation of the FTA with Korea18/05/2017
On 18th May 2017 the plenary of the European Parliament has adopted a Resolution on the implementation of the Free Trade Agreement (FTA) with Korea. The Resolution recalls that the FTA shall be considered as a process, meaning that it must be subject to periodic analyses and evaluations. Furthermore, the European Parliament observes that there are still issues that should be analysed and further implemented in the relations between the European Union and Korea, namely:
technical barriers to trade;
barriers in the area of sanitary and phytosanitary measures;
intellectual protperty rights;
trade and sustainable development;
rules of origin;
The European Parliament als calls the Commission and the EU Member States to study the preference utilisation rate of SMEs in particular and to take effective steps to raise awareness among SMEs regarding the opportunities taht the FTA ha created.
ECJ's Opinion on the envisaged FTA with Singapore16/05/2017
On 20th September 2013, the European Union (EU or Union) and Singapore initialled a text of a Free Trade Agreement (FTA). The Agreeement is on the first 'new generation' bilateral free trade agreements, that is to say, a trade agreement which contains, in addition to the classical provisions on the reduction of customs duties and of non-tariff barriers in the field of trade in goods and services, provisions on various matters related to trade, such as intellectual property protection, investment, public procurement, competition and sustainable development.
The European Commission submitted a request to the European Court of Justice (ECJ) for an Opinion to determine whether the EU has an exclusive competence to sing and conclude the FTA by itself. The Commission and the European Parliament contend that that is the case. The Council and the governments of all the Member States which submitted observations to the Court (observations were submitted by all the Member States with the exception of Belgium, Croatia, Estonia and Sweden) assert that the Union cannot conclude the agreement by itself because certain parts of the FTA fall within a competence shared between the EU and its Member States, or even within the exclusive competence of the Member States.
In today's Opinion, the ECJ, after having made it clear that the Opinion relates only to the issue of whether the EU has exclusive competence and not whether the content of the Agreement is compatible with EU law, holds that the FTA with Singapore cannot, in its current form, be concluded by the Union alone, because some of the provisions envisaged fall within competences shared between the EU and the Member States. It follows that the FTA with Singapore can, as it stands, be concluded only by the EU and its Member States acting together.
In particular, the Court declares that the EU has exclusive competence so far as concerns the parts of the FTA relating to the following matters:
access to EU market and the Singapore market so far as concerns goods and services, and in the fields of public procurement and of energy generation from sustainable non-fossil sources;
the provisions concerning protection of direct foreign investments of Singapore nationals in the EU (and vice versa);
the provisions concerning intellectual property rights;
the provisions designed to combat anti-competitive activity and to lay down a framework for concentrations, monopolies and subsidies;
the provisions concerning sustainable development;
the rules relating to exchange of information and to obligations governing notification, verification, cooperation, mediation, transparency and dispute settlement between the Parties, unless those rules related to the field of non-direct foreign investment.
Ultimately, it is in respect of only two aspects of the FTA that - according to the ECJ - the Union is not endowed with exclusive competences, namely the field of non-direct foreign investments and the regime governing dispute settlement between investors and States.
European Commission's report on the latest round of trade talks with Mercosur10/04/2017
The Commission today published a Report summarising the progress made during the latest round of negotiations for a Trade Agreement between the European Union and Mercosur (Argentina, Brazil, Paraguay and Uruguay) which took place in Buenos Aires during the week of 20th March.
More information on the EU-Japan talks are available on EU Trade's website.
2017 Rome Declaration25/03/2017
On 25th March 2017, the leaders of 27 Member States and of the EU institutions adopted a solemn Declaration to relaunch the political process of the European Union. Among the other priorities, the leaders have stressed the need to strenghten the role played by the Union on the global stage, by promoting, inter alia, free and fair trade.
Commitment for an early conclusion of EU-Japan FTA negotiations17/02/2017
Commissioner Cecilia Malmström and Japanese Foreign Affairs Minister Fumio Kishida met on 17th February 2017 in Bonn to discuss the way forward for the negotiation of a Free Trade Agreement between the EU and Japan. Both parties reaffirmed their commitment to reach a highly comprehensive and ambitious agreement as early as possible.
'Negotiations are very advanced. While it was not possible to conclude by the end of 2016, as we had hoped, tremendous progress has been registered over the last few months. As often in a negotiation, the few remaining issues are the most difficult to be solved, but I am confident that the distance between our respective positions can be bridged soon', said Commissioner Malmström.
European Parliament approves CETA15/02/2017
Along with CETA, the European Parliament has also given the green light to the conclusion of an EU-Canada Strategic Partnership Agreement (SPA), for further developing bilateral cooperation on non-trade issues.
Having been previously declared a mixed agreement by the Commission, CETA needs now to be ratified by all Member States, in accordance with their constitutional requirements. CETA could become provisionally applicable the first day of the second month following the notification of completion of internal procedure by both parties, and possibly as of April 2017.
More information on the negotiation process, content and impact of the EU-Canada Comprehensive Economic and Trade Agreement can be found here.
The EU has an exclusive competence to conclude the Marrakesh Treaty on access to published works for persons who are visually impaired14/02/2017
The Marrakesh Treaty requires the contracting States to provide in their national law that certain entities (government institutions and non-profit organisations which provide services relating to education, instructional training, adaptive reading or information access) may, without the authorisation of the rightholder, reproduce or distribute copies of published works in a format which gives access to the works for persons who are blind, visually impaired or otherwise print disabled (referred to in the treaty as ‘beneficiary persons’). The contracting States must also promote the cross-border exchange of accessible format copies by permitting certain imports and exports of those copies. In 2012 the Council authorised the Commission to participate, on behalf of the EU, in negotiations within the framework of the World Intellectual Property Organisation (WIPO) on the future Marrakesh Treaty. The Treaty was adopted on 27th June 2013. Taking the view that the EU itself (without the participation of the Member States) could conclude the Marrakesh Treaty, the Commission put forward a proposal for a decision on the conclusion of the treaty: that decision was not adopted by the Council.
The Commission then asked the Court of Justice to give its Opinion on whether the Marrakesh Treaty may be concluded by the EU acting on its own or whether the participation of the Member States is necessary for that purpose. Eight Member States, which consider that the EU does not have exclusive competence to conclude the Marrakesh Treaty in its entirety and that, their participation is therefore necessary, have taken part in the Opinion procedure.
In its Opinion, the Court examines whether the Marrakesh Treaty is connected with the common commercial policy, which, under the FEU Treaty, falls within the exclusive competence of the EU. The Court concludes that the Marrakesh Treaty does not come within the ambit of the common commercial policy. Next, the Court recalls that the EU also has exclusive competence when the conclusion of an international agreement may affect ‘common rules’ or alter their scope. The Court thus considers whether that is the case of the Marrakesh Treaty. The Court states in that regard that the EU Directive on copyright permits Member States which wish to do so to introduce –– for the benefit of persons with a disability –– an exception or limitation to the rights of reproduction and communication to the public. It follows that the exception or limitation provided for by the Marrakesh Treaty will have to be implemented within the area harmonised by the directive. The same is true of the import and export arrangements prescribed by the Treaty, inasmuch as they are intended to permit the communication to the public or the distribution, in the territory of a contracting State, of accessible format copies published in another contracting State, without the consent of the rightholders being obtained. The Court points out in that regard that, while the Member States have the option under the Directive of introducing such an exception or limitation, that option is granted by the EU legislature and is highly circumscribed by various requirements of EU law. The Court also states that, unlike the Directive, the Marrakesh Treaty lays down an obligation (not merely an option) to introduce an exception or limitation for the benefit of certain persons with disabilities. The Court thus considers that, once the Treaty is concluded, all the Member States will be required to introduce the exception or limitation for persons with a disability. It follows that the body of obligations laid down by the Marrakesh Treaty falls within an area that is already covered to a large extent by ‘common EU rules’ and that the conclusion of the Treaty may affect those rules or alter their scope.
EU-US joint report on TTIP progress17/01/2017
A joint EU-US Report on the progress made in TTIP talks has been published on 17th January 2017. Although there are some areas where parties found a common ground after several years of negotiations, the most controversial issues, such as how to improve access to public procurement markets, provide a strong investment protection that preserves the right to regulate and reconcile approach to trademarks and geographical indications still remain to be solved. However, EU and US agreed the economic and strategic rationale for an agreement still remains strong.
In the meantime, US President Trump on 23rd January 2017 formally abandoned the Trans-Pacific Partnership, which was signed by Obama but still had to be approved by the Congress.
AG's opinion on the conclusion of the FTA with Singapore21/12/2016
The European Commission sought an Opinion from the Court of Justice of the EU under Art. 218(11)TFEU on the allocation of competences between the EU and the Member States as regards concluding the Free Trade Agreement envisaged between the EU and the Republic of Singapore (EFSTA). The legal issue as to who is competent to conclude these new generation agreements – such as the TTIP – has raised a considerable debate and public attention.
On the one hand the Commission argued the EU has an exclusive competence; on the other hand, both the Council and the Governments of Member States contended there are certain parts in these agreements that fall within the shared competences between the EU and Member States and, for this reason, cannot tolerate to be concluded by the Union itself but request a joint action with the Member States.
Advocate General Sharpston’s opinion in the Opinion procedure 2/15 is particularly significant. After setting out the principles established by the Court’s case law - partially codified by the Treaties – in relation to EU exclusive and shared competences with the Member States, she applies them to the EU FTA with Singapore, with a Chapter by Chapter analysis. According to the Advocate General, not all parts of the envisaged Agreement fall within the EU’s exclusive competence and therefore the Agreement cannot be concluded without the participation of all of the Member States.
EP's opinion on Draft Council Decision on the conclusion of CETA08/12/2016
The European Parliament Committee on Employment and Social Affairs, on 8th December 2016, issued an Opinion on the Draft Council Decision on the conclusion of the Comprehensive Economic and Trade Agreement (CETA). The Committee criticized the contents of the Agreement and called on the EP Committee on International Trade to decline to give its consent to the proposal for a Council decision on the conclusion of the CETA.
79th Inter-Parliamentary meeting of Transatlantic Legislators’ Dialogue29/11/2016
The members of the US House of Representatives and European Parliament, on 29th November 2016 during the 79th inter-parliamentary meeting of transatlantic legislators’ dialogue, exchanged views on the current and political prospects and challenges for the EU and US relation. Notwithstanding the complexity of their relation, EU and US renewed their commitments towards a comprehensive Transatlantic Trade and Investment Partnership, and encouraged negotiators to secure the consolidated texts.
TTIP Advisory Group meeting22/11/2016
The Transatlantic Trade and Investment Partnership Advisory Group, launched in 2014 to provide EU Trade negotiators with high quality advice in the areas being negotiated, met on 22nd November 2016, where the Chair updated the Group on the situation regarding TTIP. Not only the election of Donald J. Trump led to many uncertainties, but also, according to the Report, further work has to be undertaken in technical areas after the 15th round of negotiations. EU-US trade relations are important and to maintain a forward looking trade agenda is a primary issue, even if no negotiation is ongoing. It is worth noting how the Group stressed the importance, for the impact on TTIP, of both the legal developments of CETA in relation to the role that Member States would have in its provisional application and the Opinion 2/15 of the Court of Justice of the European Union on the Free Trade Agreement with Singapore that will be delivered in 2017.
Council meeting after US elections11/11/2016
After 8th November 2016, which saw the election of Donald J. Trump as President of the United States, a new era has begun for US trade agreements. USA is the partner of the EU in the negotiation of the ambitious Transatlantic Trade and Investment Partnership (TTIP), which was set to be concluded before the end of Obama’s mandate. After Trump’s election, whose opinion on US foreign trade policy has never been a mystery, the Council, in its meeting of 11th November 2016, reviewed developments in TTIP negotiations and stated that the next steps would be assessed once the US Administration has taken place.
CETA signature and provisional application28/10/2016
On 28th October 2016 the Council adopted the Decision 2017/37 on the signing on behalf of the European Union of the Comprehensive Economic and Trade Agreement (CETA) between Canada, of the one part, and the European Union and its Member States, of the other part together with the Decision 2017/38 on its provisional application.
On 5th July 2016 the European Commission has proposed to conclude CETA as a mixed agreement, so that the final text of the Treaty has to be approved by the European Union together with all 28 Member States. During the procedure described by Art. 218 TFEU and Art. 207 TFEU, while the nationals parliaments are in the process of ratifying CETA, some articles of the treaty will be provisionally applied, as provided by Art. 30(7)(3) of the Agreement. A few days later, on 30th October 2016, CETA has been signed.
CETA joint interpretative instrument approved by COREPER19/10/2016
On 19th October 2016 the Parliament of Wallonia blocked the Belgium ratification process of CETA because Walloon Parliamentarians stated their refusal to the signature of the Agreement. After two weeks of talks between European Union Institutions and Walloon Parliament, an agreement was reached on 27th October 2016, when a Joint Interpretative Instrument and the Intra-Belgium Statement was approved by COREPER. The former is a permanent instrument for the interpretation of the CETA provisions, which is binding under Article 31 of Vienna Convention of the Law of Treaties. According to the Joint Interpretative Instrument, CETA will not lower the standard of consumer protection, the regulatory cooperation will remain on a voluntary basis, and both Canada and Member States will maintain their sovereignty on public health, social services, education and environment. Lastly, it faces the controversial institution of the Investment Court System (ICS) and emphasizes how this new dispute resolution system will not be more favorable for foreign investors than for the domestic investors.
TTIP Advisory Group meeting report18/10/2016
On 18th October 2016 the Transatlantic Trade and Investment Partnership Advisory Group published a Meeting Report describing the state of play of TTIP and CETA. Although there haven’t been important turning point in the negotiation, some relevant topic were discussed: Investment Court system, cars, wine and spirits and the possible new strategies in the light of the United States Presidential Election.
15th round of TTIP negotiation07/10/2016
From 3rd to 7th October 2016 the 15th round of TTIP negotiation took place in New York, without any particular progress regarding controversial topic like the issues related to the regulatory cooperation, sanitary and phytosanitary measures, liberalization of services, the regulation of public procurement, the investment chapter and investor-state dispute settlement (ISDS). The EU negotiating texts have been released on the Commission's website.
Bratislava informal Council meeting23/09/2016
During the informal Council Meeting of 23rd September 2016 in Bratislava, the French Minister of State for Foreign Trade, Matthias Fekl together with the Austrian Minister for Economy, Reinhold Mitterlehner, proposed to suspend TTIP negotiation until the United States Presidential Election. Although there were different feelings about TTIP talks, the Slovak Prime Minister Robert Fico declared that TTIP negotiations would continue. However, he also stressed that it would be unrealistic to finalise an agreement before the end of US President Obama’s mandate. Once again Member States reaffirmed their support to the European Commission and gave the green light to a new round of negotiation.
Letter of support from Member States to Malmström14/09/2016
Right after the summer break, European politicians started to question quite seriously the outcomes of TTIP negotiation. The still pending issues of the TTIP talks, together with the incoming United States presidential election, led government leaders to doubt about the conclusion of the negotiation by the end of 2016. In response to this general skepticism, of which Simon Gabriel declaration is the most famous example (released on 28th August 2016), on 14th September 2016 twelve Member States (Sweden, Italy, Spain, Portugal, Lithuania, Latvia, Ireland, Estonia, Finland, Czech Republic, Denmark and United Kingdom) decided to restate in a letter for the Trade Commissioner Cecilia Malmström, their support to the European Commission trade policy, expressing approval for CETA negotiation results and hoping a future for TTIP.
Legal Ambiguities withstanding Transatlantic Trade Investment Partnership is a Jean Monnet Network.
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