TRADE Flashcards
TRADE in a nutshell
- exclusive EU competence for trade with countries outside of EU
- Art. 207 TFEU covers
1. Trade in goods and services
2. FDI
3. public procurement
4. commercial aspects of intellectual properties, eg patens
EU trade policy and public procurement
Alongside regulating the EU’s internal public procurement market, the EU also wants to see more open public procurement markets outside the EU.
In its trade deals, the EU and its trading partners offer each other access to procurement by certain public authorities and bodies for certain goods and services to encourage more open and balanced international markets. This means that EU companies can do business in the international public procurement market more easily, thus growing their business and providing more jobs.
World Trade Organization (WTO) in a nutshell
The World Trade Organization (WTO) is made of governments and customs territories that set, apply and enforce the global rules for trade between themselves.
Both the European Union (EU) and the individual EU countries are members of the WTO.
Location: Geneva, Switzerland
Established: 1 January 1995
Created by: Uruguay Round negotiations (1986-94)
Membership: 166 members representing 98 per cent of world trade
Budget: 205 million Swiss francs for 2024
Secretariat staff: 623
Head: Ngozi Okonjo-Iweala (Director-General)
The WTO is run by its member governments. All major decisions are made by the membership as a whole, either by ministers (who usually meet at least once every two years) or by their ambassadors or delegates (who meet regularly in Geneva).
Rules about public procurement have already been included in EU free trade agreements (FTAs) with:
Andean Community
Armenia
Canada
Central America
Chile
Georgia
Iraq
Kazakhstan, see also Central Asia
Kyrgyzstan, see Central Asia
Mercosur
Mexico
Moldova
Singapore
South Korea
Switzerland
Ukraine
Vietnam
Mercosur
Der Mercosur-Gruppe gehören Brasilien, Argentinien, Paraguay, Uruguay und seit Kurzem auch Bolivien an. Mit dem Abkommen könnten die EU und Südamerika die größte Handelszone der Welt schaffen, mit mehr als 720 Millionen Menschen.
Why the EU negotiates trade deals
By acting together as one, EU countries benefit from increased negotiating power when making trade deals with other countries.
The EU negotiates trade agreements to strengthen our economy and create jobs.
EU trade agreements help to do that in two ways. Trade agreements let European businesses:
access more easily and at lower prices the raw materials and other inputs they need, helping them to stay competitive, and; compete more effectively abroad and export more to countries and regions outside the EU.
This increase in trade leads to growth in the economy and helps create jobs. It also gives consumers a wider choice of products at lower prices.
How the EU negotiates trade deals
First, the European Commission requests authorisation from the Council of the EU (‘the Council’) to negotiate a trade agreement with a trade partner. The Council’s authorisation can include ‘directives’. These are often referred to as the ‘mandate’ and set out what the Commission should achieve in the agreement.
Then the Commission negotiates with the trading partner on behalf of the EU. During the negotiations, the Commission:
works closely with the Council's trade policy committee;
keeps the European Parliament fully informed;
holds meetings with representatives of civil society, and;
publishes:
EU position papers;
proposed texts for the agreement;
reports of negotiations;
impact assessments;
background papers, and;
factsheets.
EU TRADE Negotiations might include:
removing or cutting customs duties (taxes) on goods that European companies export;
scrapping any limits (quotas) on the amounts the partner country allows EU firms to export to it;
allowing EU businesses to provide services and bid for public contracts in the partner country, and;
cutting bureaucracy to make it easier for EU firms to export, but maintaining things like health and safety standards or environmental protection.
EU Trade Policy covers
- Trade in goods & services
- Foreign Direct Investment (FDI)
- Public Procurement
- Commercial aspects of intellectual property eg patents
- tariffs/ dumping/ subsidies
Article 207 TFEU
- The common commercial policy shall be based on uniform principles, particularly with regard to changes in tariff rates, the conclusion of tariff and trade agreements relating to trade in goods and services, and the commercial aspects of intellectual property, foreign direct investment, the achievement of uniformity in measures of liberalisation, export policy and measures to protect trade such as those to be taken in the event of dumping or subsidies. The common commercial policy shall be conducted in the context of the principles and objectives of the Union’s external action.
TRADE negotiations - role of COM, Council, EP
The Commission shall make recommendations to the Council, which shall authorise it to open the necessary negotiations. The Council and the Commission shall be responsible for ensuring that the agreements negotiated are compatible with internal Union policies and rules.
The Commission shall conduct these negotiations in consultation with a special committee appointed by the Council to assist the Commission in this task and within the framework of such directives as the Council may issue to it. The Commission shall report regularly to the special committee and to the European Parliament on the progress of negotiations.
The Lisbon treaty introduced 3 main changes in trade policy
- Greater powers for EP
- Greater powers for the European Parliament - it is now co-legislator with the Council on trade matters:
* All basic EU trade legislation (on e.g. anti-dumping, trade preferences) must pass through the Parliament (the “ordinary legislative procedure”) before being dopted or amended by the Council.
* All trade agreements must be approved by Parliament to be ratified.
* Status of trade negotiations – the Commission must transmit documents and report regularly on this to the European Parliament (a degree of parliamentary scrutiny unparalleled in the field of international negotiations).
The Lisbon treaty introduced 3 main changes in trade policy
- Clarified/increased powers for the EU
Clarified/increased powers for the EU
* The Lisbon treaty creates a more solid basis for the EU to adopt autonomous acts on trade in services and commercial aspects of intellectual property (i.e. that go beyond international agreements).
* Trade in cultural/audiovisual, educational and social/health services are now an EU
power, subject, in certain cases, to specific voting rules.
* Foreign direct investment is now an EU power under trade policy, i.e. the EU can both conclude international agreements and adopt autonomous measures on FDI.
The Lisbon treaty introduced 3 main changes in trade policy
- Qualified majority voting for most trade issues
Qualified majority voting becomes the general rule in Council for all aspects of trade policy,
Unanimity is required only in specific circumstances
