Brussels, 12/05/2014 (Agence Europe) - On 8 May, the Council adopted a regulation aiming to create a common legislative framework to help the EU to defend and assert its rights under international commercial agreements, both bilaterally and multilaterally. This new instrument aims to ensure a faster response on the part of the EU in disputes, and to reinforce the credibility of its threats in order to deter its partners from failing to comply with bilateral agreements or WTO decisions.
The text, entitled “Regulation concerning the exercise of the Union's rights for the application and enforcement of international trade rules”, modifies regulation 3286/94/EC, which lays down Community procedures for common trade policy, in order to ensure the exercise of EU rights conferred upon it by the rules of international trade, particularly those instituted under the WTO.
The new regulation lays down the rules and procedures to allow the EU to exercise its rights to suspend or withdraw concessions or other obligations under international agreements in an effective and timely manner, in order: - firstly, to respond to third countries' violations of international trade rules which affect the interests of the EU, in order to seek a satisfactory solution re-establishing the advantages the EU operators; - secondly, to rebalance the concessions or other obligations in commercial relations with third countries, when the treatment of EU goods changes in a way which harms EU interests.
Under its article 3, which defines its scope, the regulation will apply: - following the adjudication of trade disputes under the WTO, when the EU has been authorised to suspend concessions or other obligations under the multilateral and plurilateral agreements covered by the WTO Dispute Settlement Understanding; - following the adjudication of trade disputes under other international trade agreements, including regional or bilateral agreements, when the Union has the right to suspend concessions or other obligations under such agreements; - for the rebalancing of concessions or other obligations, to which the application of the safeguard measure by a third country may give right under the WTO Agreement on Safeguards for provisions on safeguards included in regional or bilateral agreements; - in the event of the modification of concessions by the WTO member under article 28 of the GATT agreement of 1994, where no compensatory adjustments have been agreed.
Under the regulation, the measures, which can be instituted in an implementing act, consist of: - the suspension of tariff concessions and the institution of new or increased customs duty; - the introduction or increase of quantitative restrictions on imports or exports of goods, in the form of quotas, import or export licences or other measures; - the suspension of concessions for goods, services or suppliers in the field of public procurement. Two options are in place for this: firstly, the exclusion from public procurement contracts of suppliers of goods and services established in the third country concerned and operating from that country and/or if the total value of which represents more than 50% of goods or services from the third country in question; secondly, the institution of an obligatory price penalty on tenders made by suppliers of goods and services established in the third country concerned and operating from that country and/or on the proportion of the tender which consists of goods and services originating from the third country in question.
The Commission will have to reassess the scope of the new regulation within three years of its entry into force, particularly from the point of view of the trade policy measures (the suspension, modification and repeal of which are governed by specific provisions under article 7 of the text).
This new regulation, which will enter into force 20 days after its publication in the Official Journal of the EU, is the result of an agreement between the Council and the European Parliament on the basis of the draft text proposed by the Commission in December 2012 (see EUROPE 10754). (EH)