Brussels, 28/07/2009 (Agence Europe) - With the highest level political support given in mid-July by Swedish Prime Minister and current President of the European Council Fredrik Reinfeldt and South Korean President Lee Myung bak, conclusion of the EU-South Korea free trade agreement, long delayed because of the reservations of a number of member states over the effect of opening their car industry markets, would now seem to be on track. The Swedish Presidency has undertaken to finalise, by the end of the year, an agreement that is no longer opposed by member states, or at least despite the reservations expressed by some, principally Italy and Poland, at the 133 Committee meeting on 10 July which discussed the final compromise package negotiated between the European Commission and the South Korean government which settles the two pending political issues: reimbursement of customs duties and rules of origin. Seoul wants the agreement signed in February 2010, once the new Commission takes office, but this would delay implementation until mid-2010. In the meantime, translation of the agreement into legal terms has begun, with two bilateral meetings scheduled: one has already taken place in Brussels on 26-28 July, and the other will be in Seoul on 24-26 August. The aim is to initial the agreement with President Lee on the sidelines of the G20 summit in Pittsburgh at the end of September, before submitting it for the approval of the Council and also of the European Parliament, if the Lisbon Treaty comes into effect next year.
In addition to the remaining reservations of some member states in the Council, several voices among the European Commissioners are calling for an in-depth political debate. Against the President José Manuel Barroso and Trade Commissioner Catherine Ashton, who are keen to have the agreement initialled in September, Taxation and Customs Union Commissioner László Kovács, backed by Commissioners Jan Figel' (Education and Culture) and Antonio Tajani (Transport), is the one most opposed to the conclusion of the agreement with its current arrangements. His staff are unhappy, for example, with the system for reimbursing customs duties (duty drawback, by which Seoul authorises the refund of import duties paid by South Korean manufacturers using imported materials to produce their goods for export), which, they say, does not comply with Community rules. In addition, acceptance of this system, which is only accepted provisionally by the EU in a few agreements with EuroMed countries, could, Kovács' staff say, create a dangerous precedent for bilateral agreements the EU will negotiate with third countries in the future. Tajani and Figel' are putting forward within the College of Commissioners the persistent concerns of the governments of their respective countries, Italy and Slovenia, which still fear the effect the opening of the Community market to South Korean vehicles will have on their car industries and which have doubts over the effectiveness of the safeguard clause negotiated by the Commission to protect European car makers. Commissioner Figel' also expressed concerns over the opening of the culture and audiovisual market.
Barroso and Ashton have been assured by their colleague Günter Verheugen of the support of Germany, which has managed to win over its car manufacturers and has given its backing to the Commission compromise package. The debate called for by Kovács could take place before the formal initialling of the agreement at the end of September but is not likely to have any effect on the remainder of the process. Meanwhile, with the support of the Swedish Presidency that remains true to its free trade traditions, Ashton hopes to remove any remaining reservations in the Council. The trade commissioner and her staff will, however, still have to convince doubters over the effectiveness of the safeguard clause for the car industry, with the industry calling for it to be implemented automatically and the Commission seeking to delay it and reduce its scope. (E.H./transl.rt)