Eyes on CETA Ratification Ahead of EU Trade Committee Vote

19 January 2017

Efforts to ratify an EU-Canada trade deal have seen progress in Europe, with the agreement receiving the backing of the European Parliament’s environment, public health, and food safety (ENVI) committee last week.

The 12 January vote featured 40 lawmakers in favour, 24 against, and one abstaining. While the ENVI committee’s vote is non-binding, its opinion is meant to help inform the process going forward. Another European Parliament committee which focuses on employment and social affairs (EMPI) voted against CETA in early December, reportedly citing concerns over potentially negative implications for jobs, though that vote was similarly non-binding.

The European Parliament’s international trade committee (INTA) is due to meet from 23-24 January, with a vote on the subject due on the second day of those discussions. The accord must make its way through INTA before reaching the full European Parliament plenary, with the 751-member legislative body then expected to vote on CETA next month.

Meanwhile, Germany’s constitutional court issued a ruling last week which confirmed that the country’s government has taken the necessary steps to allow for CETA’s signing and provisional application – countering claims raised by some domestic opponents of the deal.

Across the Atlantic, the trade deal and its implementing legislation have been submitted for Canadian parliamentarian consideration. It has passed two readings in the House of Commons and has been referred to the Standing Committee on International Trade, which held a meeting on the subject on 14 December.

Should the trade agreement be ratified successfully in both the European and Canadian parliaments, it will be applied provisionally until it secures the ratification of individual member state parliaments in the EU. (See Bridges Weekly, 7 July 2016)

The trade deal was negotiated over several years, with formal talks kicking off in 2009. The final version is set to eliminate 99 percent of tariffs, with the bulk of these to be removed once the deal is in force. It also adopts a series of provisions aimed at facilitating foreign investment and improving services market access.

CETA also features improved public procurement market access, and includes a new investment court system, the latter of which has drawn intense public scrutiny. The new court, proponents say, is meant to be a significant improvement over the previous investor-state dispute settlement (ISDS) system, which has become a common feature in international trade and investment deals.

EU and Canadian leaders signed CETA this past October, following several weeks of protracted negotiations aimed at bringing the Belgian regional authorities of Wallonia on board. (See Bridges Weekly, 3 November 2016)

ECJ advocate general circulates opinion on EU-Singapore FTA

In late December, an advocate general for the European Court of Justice (ECJ) circulated her final opinion on whether a separate trade and investment deal between the European Union and Singapore falls within the EU’s “competence,” which affects how the accord will move forward in the future signature and ratification stages.

The EU-Singapore FTA negotiations were concluded in October 2014. That same year, the European Commission asked the EU’s highest court to rule on its competence on this issue, stating in a decision that “it is uncertain whether the Union has the necessary competence (whether exclusive or shared) to conclude alone the Free Trade Agreement with Singapore or whether the participation of the member states is necessary, or at least possible, in respect of certain matters.”

The specific question put forward by the Commission was whether the EU has “the requisite competence” to sign and conclude the EU-Singapore FTA fully on its own, along with questioning whether provisions might fall under exclusive or shared competence, and if any sections of the deal are solely the competence of individual EU countries.

While the results of the final ECJ ruling will focus on the implications for the EU-Singapore deal, they are also expected to be useful in clarifying the roles of the European Commission and member states in trade negotiations going forward, which has already been a source of controversy in the CETA situation and others.

The opinion issued by Advocate General Eleanor Sharpston on 21 December deemed that the EU-Singapore accord “can only be concluded by the EU and the member states acting jointly.” She also listed which areas of the FTA should fall under the EU’s exclusive external competence and which ones fall under shared competence with EU countries.

“While the Advocate General notes that difficulties may arise from a ratification process involving all of the member states alongside the EU, she considers that that cannot affect the question of who has the competence to conclude the agreement,” says a media release summarising the Advocate General’s official opinion.

The ECJ has yet to deliver its final opinion, though the same media release confirms that it is due this year.

ICTSD reporting; “Parliament gives boost to EU-Canada CETA trade deal,” NEW EUROPE, 13 January 2017; “European Parliament committee says reject EU-Canada trade deal,” REUTERS, 8 December 2016; “Protracted EU-Canada trade deal clears hurdles in Europe,” THE GLOBE AND MAIL, 12 January 2017.

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