CETA the EU FTA with Canada is fit for the 21st century
The EU recently concluded a new FTA Free Trade deal with Canada – the Comprehensive Economic and Trade Agreement, or CETA for short. It has to be ratified by the EU Parlament and the EU countries for the first time ever
The deal is possibly the most advanced of its kind to date. It will help to generate growth and jobs by boosting exports; lowering the cost of the imports businesses need to make their products; offering greater choice for consumers; and upholding the EU’s strict standards for products.
CETA will significantly improve business opportunities for European companies in Canada. With CETA, European companies will receive the best treatment that Canada has offered to any trading partner, thus levelling the playing field for EU companies on the Canadian market.
CETA will bring tangible benefits to European consumers and companies by eliminating or cutting tariffs, in most cases as soon as CETA comes into effect. This will provide important market opportunities for European companies in particular the smaller ones and could save European exporters hundreds of millions of euros a year. As of the first day of its implementation, Canada will eliminate duties worth 400 million Euros for goods originating in the EU. At the end of transitional periods for duty elimination, that figure will rise to EUR 590 million a year. Opening markets also has the potential to keep prices down and provide consumers with more choice. At the same time, free trade does not mean lowering or changing EU standards that protect people’s health and safety, their rights as consumers and the environment. These standards will remain untouched and imports from Canada will have to satisfy all EU product rules and regulations – without exception.
Opening up services and encouraging investment
CETA is the by far the most far reaching agreement ever concluded by EU in the area of services and investment. European firms will have new advantages when it comes to getting investment projects approved in Canada. European firms will also have more opportunities to provide services, for example, specialised maritime services like dredging, moving empty containers, or shipping certain cargo within Canada. In other service sectors, such as environmental services, telecom and finance, market access is ensured, both at federal level and – for the first time – provincial level. In CETA – as in all its trade agreements – the EU fully protects public services.
Mutual recognition of professional qualifications
The agreement provides a framework to approve the recognition of qualifications in regulated professions such as architects, accountants and engineers. The relevant professional organisations in the EU and Canada will have to jointly work out the technical details of recognition of their respective qualifications on the basis of the framework. The competent authorities in Canada and the EU will then approve their work and give it legal effect.
CETA will make it easier for company staff and other professionals to work on the other side of the Atlantic, and for firms to move staff temporarily between the EU and Canada. This will help European companies run their operations in Canada. It will be also easier for other professionals to temporarily supply legal, accounting, architectural or similar services.
Making European firms more competitive on the Canadian market
CETA will make European firms more competitive on the Canadian market by making it easier for them to provide after–sales service. This will help EU firms to export equipment, machinery and software by allowing them to send maintenance engineers and other specialists to provide after-sales and related services and support.
Giving EU firms access to government tenders
Canada has opened up its government tenders to EU companies to a greater extent than with any of its other trading partners. EU firms will be able to bid to provide goods and services not only at the federal level but also to Canadian provinces and municipalities – the first non-Canadian firms to be able to do so. Canada’s provincial procurement market is estimated to be double the size of its federal equivalent. Canada has also agreed to step up transparency by publishing all its public tenders in a single procurement website. Access to information is one of the biggest obstacles for smaller companies in accessing international markets, so this will be a boon for smaller businesses in Europe.
Cutting companies’ costs without cutting corners on standards
EU and Canada have agreed to accept each other’s conformity assessment certificates in areas such as electrical goods, electronic and radio equipment, toys, machinery or measuring equipment. This means that, under certain circumstances, a conformity assessment body in the EU can test EU products for export to Canada according to Canadian rules and vice versa. This will avoid both sides doing the same test and could greatly reduce costs for companies and consumers alike. This is of particular benefit to smaller companies for whom paying twice for the same test can be prohibitive.
Protecting Europe’s innovators, artists and distinctive European food and drink products
CETA will create a more level playing field between Canada and the EU in the area of Intellectual Property Rights (IPR). For example, it will strengthen the protection of copyrights by aligning Canadian rules with those of the EU on protection of technological measures and digital rights management. It will also improve how Canada’s IPR system protects patents for EU pharmaceutical products. It will also bolster enforcement by foreseeing the possibility of provisional measures and injunctions for intermediaries involved in infringing activities. Canada also agreed to strengthen its border measures against counterfeit trademark goods, pirated copyright goods and counterfeit geographical indication goods.
CETA is an important step forward for many medium-sized and smaller businesses in rural communities trading in agricultural products. They will now benefit from Canada agreeing to protect 143 distinctive products from specific geographical regions in the EU. The products which will be protected in CETA are the most exported EU food and drink products ranging from Roquefort cheese, to balsamic vinegar from Modena and Dutch Gouda cheese. European products will be protected from imitations at a level comparable to EU law and will avoid the risk of being considered generic in Canada.
Protecting people’s rights at work and the environment
In CETA the EU and Canada affirm their commitment to sustainable development. Both agree that more trade and investment should further environmental protection and labour rights – and not be at their expense. The EU and Canada are committed to CETA helping to ensure that economic growth, social development, and environmental protection are mutually supportive. CETA integrates the EU’s and Canada’s obligations to international rules on workers’ rights and environmental and climate protection. CETA gives a strong role to EU and Canadian civil society in participating in the implementation of the commitments in these areas in CETA. CETA also sets up a process for settling disputes, including government consultations and a panel of experts.
Following a decision by the Council, it will be possible to provisionally apply CETA. Its full entering into force will be subject to the conclusion by the EU, through a Council decision with the consent of the European Parliament, and by all Member States through the relevant national ratification procedures. This is the first time ever such a proceedure is applied for an FTA in the EU and is certainly an outflow of Brexit and the critic on the EU going with it.