CETA: Not dead, but going through ‘fitness test’

Live Blog

This blogpost will follow the evolution of the issue during the weekend and will update its status live.

Sunday 30 Oct

15:45 EET

BRUSSELS: Agreement signed. "No precedent for UK after Brexit", says Juncker

The ceremony of signature  of CETA was completed a few minutes ago. Jean-Claude Juncker, President of the Commission, denied rumours that the EU-Canada agreement would serve as a model for the relationship between the Union and Britain after the completion of Brexit, the process for which is expected to begin by the end of March 2017. Reuters.

07:00 EET

Signature of CETA delayed

The aircraft of the Canadian PM Justin Trudeau had to turn back to Ottawa last night, shortly after taking-off, for technical reasons.

Mr. Trudeau will fly to Brussels today (Sunday), but details have  not been disclosed. The consequence of the incident is that the signature of CETA will be delayed by a few hours. AP, Reuters.

Saturday 29 Oct

11:30 EET

Happy end is near, but policy-makers are split on trade

The President of the European Council Donald Tusk late last night announced  that the signature of the Treaty ('CETA') will be held on Sunday, 30 October, at 12 noon in Brussels.

Canadian Prime Minister Justin Trudeau has also confirmed his presence at the ceremony. The crisis is apparently over.

This outcome doesn't, however, mean that the debate over the Commission's powers to conclude international agreements is over. 

A discussion with 52 influential policy makers from EU's member states--MPs, MEPs, politicians, diplomats, and corporate CEOs--organised at the end of the week in Brussels by daily Politico, revealed that opinions in the Union are split. 

The voting session that concluded the meeting confirmed the schism: 50% of the votes favoured empowering the Commission, while 50% took the position that the states and the qualified regions should have a final say in finalising such agreements.

Friday 28 Oct

Update 22:00 EET

CETA approved by regional parliament

The Belgian regional parliament of Wallonia, in Namur, has now approved the ratification of CETA by the country's federal parliament in Brussels , with 58 votes in favour and 5 against.

The approval became possible after the Commission and Canada accepted the amendments to the Agreement  proposed by the Walloons (see below). The new clauses will be incorporated in the final text in the form of a binding addendum.

As the other 27 EU member states have already committed to the ratification of the Agreement by their national assemblies, CETA should go into effect in 2017. The Commission estimates that trading between the European bloc and Canada should increase, as a result, by 20% in the foreseeable future.

The end of the crisis partially restores the Commission's credibility in negotiating on behalf of all member states complex international agreements. But the amendments in CETA, which restrict the powers of independent tribunals and maintain strict controls over foreign investors in ISDS (see below), are not necessarily good news for the defenders of TTIP--a deal similar to CETA  but  between the EU and the U.S. Washington will most likely be more resistant to such amendments than Ottawa has been this week.

Commission's deadline to Belgium: 28 October at midnight

Corridor diplomacy between the Walloon Region, the Belgian Federal Government and the European Commission during the past eight days leads observers to believe that the transatlantic agreement between Canada and the EU may survive.

Survival of CETA is, however, conditional. It depends on the acceptance by the Commission, the Canadian government and the other 27 EU member states of new clauses proposed by the three autonomous regions of Belgium, which last week rejected the terms of the proposed text that the Commission and Canada had agreed upon.

The additional clauses include ‘safeguard’ terms, which would enable Wallonia (but also EU member states and autonomous regions in such countries) to block the implementation of the Agreement, even after its ratification and of its going into effect. It should be noted that all international trade agreements have similar clauses, in view of preserving the sovereignty of the signatory states and the democratic powers of their national parliaments.

In the case of CETA, Wallonia and Belgium are prepared to ratify the Agreement on the conditions that: the European Court of Justice issues an opinion clearing the legality of the Investor-State Dispute Settlement (‘ISDS’) arrangement; all the member states agree on the exact methodology of appointing judges at the ISDS tribunals; CETA is implemented on a ‘provisional’ basis, giving the possibility to member states and autonomous regions to cancel the Agreement during such trial period; the Commission and other EU institutions  periodically monitor CETA’s functioning to determine whether the Agreement is beneficial to the societies of EU and its regions; states or regions are granted the right to block parts of the Agreement in the event it has negative consequences for certain activity sectors—primarily agriculture.

The Commission has given a deadline by Friday, 28 October for Belgium and its regional parliaments to commit to the ratification of CETA. The government of Canada, which has been informed of the proposed amendments, is sceptical as to the time necessary to examine all changes and agree to them.

As a refresher: CETA is a ‘mixed’ international trading agreement, and as such it requires unanimous approval by all 28 member states and the 10 autonomous regions with such states. On the one hand, this decision-making formula ties the hands of the Commission in concluding advanced trading agreements with third countries. If CETA is not approved, the Commission’s credibility in the international arena will be seriously diminished. On the other hand, the process grants the citizens of the EU more protection over trade-driven initiatives, which may be favourable to a small number of industrialists and financiers, but not necessarily to the entire community.