Canada – EU
(BRUSSELS) – The European Commission appeared to give in to political pressure Tuesday and sent the Comprehensive Economic and Trade Agreement between the EU and Canada to EU governments for signature.
The Commission had given notice that it saw the CETA – widely seen as a test for the troubled EU-United States TTIP agreement currently under negotiation – as an ‘EU-only’ agreement, falling under exclusive EU competence.
However, the majority of EU Member States and the European Parliament had made clear their opposition to this legal procedure, seeing CETA as a ‘mixed deal’, which requires ratification by all national parliaments.
While the Commission has now recognised that the agreement requires the approval of national parliaments, it is insisting nevertheless that the deal can apply even before parliaments can take a vote.
“The trade agreement between the EU and Canada is our best and most progressive trade agreement and I want it to enter into force as soon as possible,” said Commission president Jean-Claude Juncker. The Commission says the deal is set to benefit people and businesses big and small across Europe as of the first day of its implementation.
Trade Commissioner Cecilia Malmstroem added: “The agreement reached with Canada is a milestone in European trade policy. It is the most ambitious trade agreement that the EU has ever concluded and will deepen our long-standing relations with Canada. It will help to generate much-needed growth and jobs while fully upholding Europe’s high standards in areas like food safety, environmental protection and people’s rights at work. This is what our trade policy is all about. I now hope that the deal with Canada can be signed, provisionally applied and concluded quickly, to the benefit of consumers, workers, and entrepreneurs this is an agreement that Europe needs. Meanwhile, the open issue of competence for such trade agreements will be for the European Court of Justice to clarify, in the near future. From a strict legal standpoint, the Commission considers this agreement to fall under exclusive EU competence. However, the political situation in the Council is clear, and we understand the need for proposing it as a ‘mixed’ agreement, in order to allow for a speedy signature.”
The Commission says that after receiving the green light from the Council and consent from the European Parliament, it will be possible to provisionally apply the agreement.
CETA will, says the EU executive, scrap almost all customs duties, saving EU firms hundreds of millions of euros a year in duty payments, thus also benefiting European consumers directly, by reducing prices and increasing choice of products imported from Canada.
The Commission says CETA will boost trade in services, create new market access and provide better access for European suppliers of services in which EU companies are world leaders, ranging from maritime services, telecoms, and engineering to environmental services and accountancy. It will make it easier for service suppliers to travel between the EU and Canada to connect with their customers. It will facilitate the recognition of professional qualifications for regulated professions (such as architects, accountants and engineers), opening up new opportunities for professionals in these sectors. And it will allow EU companies to bid for Canadian public contracts at all levels of government federal, provincial and local and in areas from IT systems to roads to trains.
CETA will also help cut costs for EU firms, especially the smaller ones, thanks to the mutual recognition of so-called “conformity assessment certificates” for a wide range of products, from electrical goods to toys. For example, if an EU firm wants to export toys it will only need to get its product tested once, in Europe, to obtain a certificate valid for Canada, thus saving time and money.
Canada has also taken commitments to follow the EU’s approach and publish all its public procurement tenders on a single website. This will make it much easier for interested EU companies to access the information they need about such tenders.
CETA also contains rules on the protection of labour rights and the environment. Both sides have pledged never to undermine the EU’s high standards for the sake of commercial interests, but instead to work together to encourage others around the world – particularly developing countries – to raise their own.
Over 140 European Geographical Indications of food and drink products (from Tiroler Speck, from Austria, to Gouda and Roquefort cheeses from the Netherlands and France) will enjoy a high level of protection in the Canadian market, whereas without the agreement there is no such protection. CETA will make sure that only genuine products can be sold in Canada under those names.
In addition, CETA introduces a new investment court system and enhanced rules on investment protection. This guarantees the right of EU governments to regulate in the interest of their citizens, while still encouraging foreign investors by protecting their investments. The new system also makes the resolution of investment disputes fairer and more transparent. As such it serves as an important step towards the EU’s ultimate goal of a global investment court.
EU trade ministers are expected to discuss and then vote on the Commission proposal for CETA ratification at meetings in September and October.
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