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EU countries to decide on Singapore trade deal | EU countries to decide on Singapore trade deal |
(about 3 hours later) | |
An EU-Singapore free trade deal cannot take effect fully unless parliaments in all 28 member states approve it, the EU's top court has decided. | An EU-Singapore free trade deal cannot take effect fully unless parliaments in all 28 member states approve it, the EU's top court has decided. |
The legal opinion at the European Court of Justice (ECJ) could delay progress towards a UK free trade deal with the EU during the Brexit negotiations. | The legal opinion at the European Court of Justice (ECJ) could delay progress towards a UK free trade deal with the EU during the Brexit negotiations. |
The European Commission negotiates trade deals on behalf of the EU. | The European Commission negotiates trade deals on behalf of the EU. |
But the ECJ says the EU-Singapore deal, concluded in 2014, has parts that affect powers enjoyed by member states. | But the ECJ says the EU-Singapore deal, concluded in 2014, has parts that affect powers enjoyed by member states. |
Indirect "portfolio" investments and commercial arbitration are issues that need national approval, the ruling said. | |
The verdict makes it more likely that any UK-EU free trade deal will have to be ratified by national and regional parliaments in the EU. | The verdict makes it more likely that any UK-EU free trade deal will have to be ratified by national and regional parliaments in the EU. |
The Singapore deal is not as wide-ranging as the EU-Canada trade deal (Ceta), which was nearly scuppered by objections in Wallonia, the mainly French-speaking part of Belgium. | The Singapore deal is not as wide-ranging as the EU-Canada trade deal (Ceta), which was nearly scuppered by objections in Wallonia, the mainly French-speaking part of Belgium. |
Ceta will take effect provisionally in the coming weeks, but full implementation still requires the approval of 38 parliaments in the EU - national and regional. | Ceta will take effect provisionally in the coming weeks, but full implementation still requires the approval of 38 parliaments in the EU - national and regional. |
The UK has to negotiate the terms of its exit from the EU by the end of March 2019. But the UK government also wants to make speedy progress towards a comprehensive new trade deal with the EU. | |
The Commission says the terms of UK withdrawal - including thorny budget issues - must be agreed before any trade negotiations with the UK. | The Commission says the terms of UK withdrawal - including thorny budget issues - must be agreed before any trade negotiations with the UK. |
EU power struggle | |
The Commission saw the Singapore deal as a possible model for future trade negotiations, which might bypass national parliaments, so reducing the risk of a national veto blocking the entire EU. | |
The EU spent seven years negotiating Ceta - yet the deal nearly collapsed over Wallonia's objections. | |
But the ECJ ruling ensures that the Ceta model will prevail - that is, a "mixed" agreement requiring approval at both EU and national level. | |
If the Commission had exclusive powers to clinch free trade deals, the whole process could be speeded up. | |
But the Council - the EU institution where national governments decide policy - argued that national parliaments should have a bigger say. | |
Europe saw huge demonstrations against Ceta and the proposed EU-US free trade deal called TTIP. | |
US President Donald Trump's "America First" agenda has made a TTIP deal look even more remote. The shock of the 2008 financial crisis fuelled protectionism in the US and Europe. | |
The Commission champions free trade, including freedom of movement. Free trade deals, supporters say, open doors for businesses and create jobs by scrapping tariffs and protectionist barriers. | |
But critics say such deals make it easier for powerful corporations to change the rules in key areas like healthcare and the environment. | |
Much commercial arbitration is shrouded in secrecy - and critics demand transparency. There is strong opposition to the system for settling disputes between investors and governments, called Investor-state dispute settlement (ISDS). | |
Public pressure forced the Commission to abandon ISDS in the Ceta and TTIP negotiations. Critics see ISDS as a "Trojan Horse" that can undermine national authorities. |
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