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Ruling on E.U. Trade Deals Retains Hurdle in ‘Brexit’ Talks Ruling on E.U. Trade Deals Retains a Hurdle for ‘Brexit’ Talks
(35 minutes later)
LONDON — The European Union’s highest court ruled on Tuesday that a 2014 trade deal with Singapore required the approval of parliaments from the bloc’s 28 members, leaving in place an obstacle to future negotiations — including talks with Britain over its withdrawal from the union.LONDON — The European Union’s highest court ruled on Tuesday that a 2014 trade deal with Singapore required the approval of parliaments from the bloc’s 28 members, leaving in place an obstacle to future negotiations — including talks with Britain over its withdrawal from the union.
The European Commission, the bloc’s executive arm, has concluded many aspects of trade deals in the past, and Tuesday’s ruling mostly supported that approach. Yet in maintaining the status quo, the court also made clear that parts of trade agreements, particularly those that concern investment, are contingent on approval by national governments, leaving them open to shifting domestic politics. The European Commission, the bloc’s executive arm, has concluded many aspects of trade deals in the past, and Tuesday’s ruling mostly supported that approach. Yet in maintaining the status quo, the court also made clear that parts of trade agreements, particularly those that concerned investment, were contingent on approval by national governments, leaving them open to shifting domestic politics.
The requirement that trade deals be approved by dozens of parliaments has been a sticking point in the past. A free-trade agreement with Canada nearly fell apart last year after a Belgian regional assembly initially voted against it, calling for greater protection for local dairy farmers. The requirement that trade deals be approved by dozens of parliaments has been a sticking point in the past. An agreement with Canada nearly fell apart last year after a Belgian regional assembly initially voted against it, calling for greater protection for local dairy farmers.
Although the impasse was eventually resolved, the dispute highlighted the extent to which a vast array of groups can effectively veto deals that can take years to negotiate.Although the impasse was eventually resolved, the dispute highlighted the extent to which a vast array of groups can effectively veto deals that can take years to negotiate.
“What the court basically said is that E.U. member states have a say in this,” said Anahita Thoms, a Düsseldorf-based trade lawyer with the British law firm Freshfields Bruckhaus Deringer. “It reinforces the principle that the E.U. does not have exclusive competence here.”“What the court basically said is that E.U. member states have a say in this,” said Anahita Thoms, a Düsseldorf-based trade lawyer with the British law firm Freshfields Bruckhaus Deringer. “It reinforces the principle that the E.U. does not have exclusive competence here.”
“Negotiating trade deals is complicated,” she added, “and this judgment will not lessen the complications associated with trade deals.”“Negotiating trade deals is complicated,” she added, “and this judgment will not lessen the complications associated with trade deals.”
The ruling comes amid growing anti-trade sentiment across much of the Western world, including in the European Union. A complex and far-reaching trade deal between the bloc and the United States was essentially abandoned in the final months of President Obama’s administration in the face of opposition from left-wing groups in Europe. The ruling comes amid growing anti-trade sentiment across much of the Western world, including in the European Union. A complex and far-reaching trade deal between the bloc and the United States was essentially abandoned in the final months of the Obama administration in the face of opposition from left-wing groups in Europe.
The debate over trade policy has pitted mainstream politicians, who say the agreements spread prosperity, against opponents — including parties on the extreme right and left — who say that the deals give corporations too much power and erode national sovereignty.The debate over trade policy has pitted mainstream politicians, who say the agreements spread prosperity, against opponents — including parties on the extreme right and left — who say that the deals give corporations too much power and erode national sovereignty.
While the ruling itself pertains to a trade deal with Singapore, its impacts could be far-reaching, potentially affecting Britain’s negotiations to leave the European Union.While the ruling itself pertains to a trade deal with Singapore, its impacts could be far-reaching, potentially affecting Britain’s negotiations to leave the European Union.
The British government has suggested it will seek a broad-ranging trade deal with the European Union, but others have noted such agreements typically take several years to reach, and that time is limited. The British government has suggested it will seek a broad-ranging trade deal with the European Union, but others have noted that such agreements typically take several years to reach and that time is limited.
Negotiations must conclude by early 2019, when the clock runs out on Britain’s membership in the bloc, and a ruling that affirmed agreements like the one with Singapore would have eliminated at least one layer of complexity. Negotiations on the withdrawal must conclude by early 2019, when the clock runs out on Britain’s membership in the bloc, and a ruling that affirmed agreements like the one with Singapore would have eliminated at least one layer of complexity.
Tuesday’s ruling did not, however, do so.Tuesday’s ruling did not, however, do so.
“The free trade agreement with Singapore cannot, in its current form, be concluded by the European Union alone,” the Court of Justice of the European Union in Luxembourg said in a statement, adding that the deal could be “concluded only by the European Union and the member states acting together.” “The free-trade agreement with Singapore cannot, in its current form, be concluded by the European Union alone,” the Court of Justice of the European Union in Luxembourg said in a statement, adding that the deal could be “concluded only by the European Union and the member states acting together.”
Margaritis Schinas, the chief spokesman for the European Commission, the executive arm of the bloc, said in a statement that the ruling affirmed “the division of competences between the E.U. and the member states.” He added that officials would still need to “carefully assess and analyze the opinion” in order to find “the way forward.”Margaritis Schinas, the chief spokesman for the European Commission, the executive arm of the bloc, said in a statement that the ruling affirmed “the division of competences between the E.U. and the member states.” He added that officials would still need to “carefully assess and analyze the opinion” in order to find “the way forward.”
The ruling on Tuesday is final, according to officials at the court.The ruling on Tuesday is final, according to officials at the court.