23rd Apr 2019

EU treaty implications for trade unclear

The defining message emanating from a meeting of trade experts on Tuesday (8 December) was one of uncertainty regarding Lisbon Treaty changes to the EU's external commercial policy.

"Lisbon gives us a signpost but doesn't tell us exactly which way to go," said Roderick Abbott, a senior trade advisor with the European Centre for International Political Economy, a Brussels-based think-tank, which hosted the commerce debate.

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Despite the multiple question marks however, a number of broad changes ushered in under the EU's new set of rules are definable, and stand to alter the way the 27-member union deals with the international trade community.

The full gamut of services is clearly defined as an area of exclusive EU competence under the new treaty, with foreign direct investment also included in this section for the first time.

"These changes in content mean an end to the infamous 'mixed agreements'," said Steve Woolcock, a leading scholar on EU trade policy with the London School of Economics. "This will dispense with the need for national parliament ratifications [of EU trade agreements]."

But most importantly, the role of the European Parliament has been stepped up considerably in many areas, including trade policy, since the Lisbon rules came into force on 1 December.

Forty new fields will now be decided by the EU's "co-decision" legislative procedure - now renamed the "ordinary legislative procedure" - that gives equal weight to the parliament and the council of ministers representing member states.

"Parliament will now have joint powers together with the council in adopting trade legislation," said Mr Woolcock.

The European Commission – which as the EU executive carries out trade negotiations - will now also be legally obliged to share information with the parliament's international trade committee regarding the state of discussions with third countries.

Parliament will be required to give its consent to all international trade agreements, while the power to authorise negotiations remains with the council of ministers.

Several speakers indicated however that parliament is likely to try to exert greater influence over the objectives of EU trade policy under the new rules, rather than merely give its approval at the end of negotiations.

The adoption of a new inter-institutional framework agreement between the EU's three main bodies will help define the exact nature of the new decision making processes, with the assembly's greater role and porous nature opening up new opportunities for lobbyists.

Parliament and member state tensions?

The need to seek parliamentary approval is likely to help EU negotiators when dealing with third countries, with the US administration frequently pointing to the need to get agreements past Congress as a tactic to swing the debate in its favour.

However securing parliamentary approval is also likely to slow the whole process down. "My god it will take a long time," said Jean-Francois Brakeland, a senior trade official within the commission. "You don't pass things in four days by co-decision."

At the same time, Mr Brakeland pointed out that in fact the commission drafts very little trade legislation, with perhaps five new pieces expected during its next five-year term.

As a result, instead of working together in amending draft trade rules, the council and the parliament's relationship will be defined by their ability to agree on the components of new trade agreements.

"The council is not used to working with the European Parliament [in this way]," said the commission official, pointing to possible tensions.

Much will depend on where the majority position within parliament lies on important trade issues says Andreas Maurer, an official within the legislature's secretariat dealing with the policy area.

That is likely to be shaped during hearings of the new incoming trade commissioner - the Belgian Karel de Gucht - in January.


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