Category Archives: European Union

Britain, Economic, European Court, European Union, Government, Legal

Free-trade deal possible post-Brexit following landmark EU court ruling

FREE TRADE AGREEMENT

ECJ

The court ruled that Brussels has trade negotiating competence over all goods and services.

Britain’s ambition to sign a quick Free Trade Agreement with the European Union after Brexit has received a significant boost after a landmark ruling by the European Court of Justice handed expanded trade negotiation powers to Brussels.

The much-anticipated decision from the court in Luxembourg surprised experts by ruling that on key areas – including financial services and transport – the European Union does not need to seek ratification of a trade deal by the EU’s 38 national and local parliaments.

Trade experts said the ECJ ruling could substantially reduce the risk of any future EU-UK free trade agreement getting bogged down in the EU national parliaments, opening the way for an FTA to be agreed by a qualified majority vote of EU member states.

“The Court of justice says all services – even transport – can be ratified by a qualified majority vote, which is potentially quite a big opening for the UK,” said Steve Peers, professor of EU law at Essex University. “It could certainly make things easier.”

In the ruling, the ECJ was asked to decide whether the new-generation bilateral EU-Singapore trade deal should be treated as a so-called ‘mixed’ agreement – that requires ratification by national parliaments – or could be agreed by a qualified majority vote of member states.

The court ruled that the EU did not have exclusive competence to conclude the Singapore deal, but said that only in two narrow areas – namely non-direct foreign investment and the investor-state dispute resolution mechanisms – did it need to seek ratification by national parliaments.

By contrast, the court said the EU did have competence to conclude agreements without ratification across the great majority of the Singapore agreement – contradicting parts of a previous opinion by the court’s advocate-general.

The court ruled that Brussels has trade negotiating competence over all goods and services.

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Definition, meaning and purpose of a Free Trade Agreement (FTA).

Areas covered by EU competence include all goods and services, “including all transport services”, as well as intellectual property rights, competition policy, labour and environmental standards and the rules relating to exchange of information.

Legal and trade experts said the ruling had potentially massive implication for Brexit if the UK formulated its own FTA to avoid investment provisions and investor-state dispute mechanisms, relying on alternative arrangements such as bilateral investment treaties and WTO panels.

“This is the most significant ECJ case on EU trade policy for twenty years and has huge ramifications for any UK-EU FTA,” said Nicole Kar, head of international trade at Linklaters, the law firm.

“In policy terms, now the UK government will want to consider whether it moderates its ambition for the UK-EU FTA to those matters where there is exclusive competence in order to secure agreement through EU Member State governments by qualified majority voting.”

If Britain took a more expansive approach, Ms Kar warned, it risked any FTA getting mired in member state politics as happened last year when the regional Walloonian parliament of Belgium held the EU-Canada trade deal to ransom.

This problem arises because some EU member states, like Belgium, have domestic law that requires local parliaments to sign off on trade deals before they can be ratified by at a national level.

Allie Renison, head of EU and trade policy at the Institute of Directors, said the court ruling was to be welcomed and would make it easier for the EU to conclude deals “without fear of as many hold-ups from national and sub-national legislatures”.

“How this affects Brexit negotiations will depend on whether the final trade agreement includes investment provisions or not, although neither the UK or EU has expressed much interest in this to date,” she added.

“It’s important to remember that any eventual UK-EU trade agreement would not be about opening up each other’s markets in controversial areas, but trying to limit the amount of disruption to trade, and so it is unlikely to encounter the same resistance from other EU countries once concluded by the Commission.”

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European Union, France, Government, Politics, Society

Emmanuel Macron’s task is to restore confidence in the Fifth Republic

FRANCE

Macron

Emmanuel Macron wins the election to become French president.

The revelation of a last-minute attempt by computer hackers to influence the outcome of the French presidential election is another sane reminder of the forces at work in undermining democracy. In the end, however, it had little effect, as Emmanuel Macron secured his expected victory, at 39, to become the youngest French head of state of modern times. This is an extraordinary achievement for the President-Elect for he has been a candidate without a party.

Some will likely argue that the margin of triumph over Marine Le Pen was emphatic enough. Others might suggest that with around one third of voters still prepared to vote for the Front National (FN), this too was none the less a good result for a right-wing populist, anti-EU party.

The results suggest that if Mr Macron disappoints during his five-year tenure in office – as François Hollande so evidently did before him – then Ms Le Pen will be well positioned in 2022 to take power.

Given that this was an election in which neither candidate represented one of the mainstream Left- or Right- wing parties, Mr Macron has assumed an enormous level of responsibility on his shoulders.

The French electorate have clearly become weary of political leaders who promise much but deliver little. One prominent sign of their dissatisfaction with the political system as a whole was the lower than usual voter turnout, with participation possibly lower than at any time for 40 years when final figures are collated.

Whilst there is a sense that the French voter may have been left to feel short-changed, their rejection of the traditional parties has not exactly enamoured them of the populist fringe movement represented by Ms Le Pen. Or, indeed, of the alleged centrist appeal of Mr Macron, given his connections to former president Hollande.

Primarily, it is incumbent on Mr Macron to restore his country’s faith in the Fifth Republic over the next five years. This task will be made more difficult by the fact that his movement, En Marche!, has no parliamentary representation, something that will have to be swiftly rectified when elections take place to the assembly next month.

With little in the way of an activist base, Mr Macron faces a political paradox – one in which he may end up with the trappings of political office but none of the power that derives from a strong presence in the legislature. Moreover, and more worrying still, is that information in the hacked data might yet mire him in political scandal.

The contents of the hacked data were not disclosed because of the strict rules operating in France during the latter stages of the election campaign. But the new French president-elect must be hoping that there is nothing embarrassing, or worse, to be revealed.

Yet, the lesson of Ms Le Pen’s showing in the polls needs to be readily acknowledged by Europe’s elites, who have openly welcomed Mr Macron as a saviour. But they need to understand that this does not represent the definitive victory of the European project over its detractors. Far from it. It is a desperate throw of the dice for the EU to have relevance and meaning.

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Britain, European Union, Government, Politics, Society

Britain will be entitled to walk away without a deal with the EU

BREXIT

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When the 27 EU leaders met to review their Brexit talks guidelines last Friday, it took them less than a minute to approve the draft. They then burst into open applause – the grandstanding almost akin to a Soviet-era meeting of Warsaw Pact comrades. The guidelines are provocative and blatantly breach the UK’s own red lines. Britain, in turn, must spell out that it is prepared to walk away if it is unsatisfied with the deal that the talks produce.

The EU’s mask of collegiality and high ideals is slipping. As it does, so the decision of the British voters to walk away last year looks even wiser. Britons should be aware that walking away is a valid and legal option that the UK is entitled to exercise if talks with the EU irretrievably break down.

Extracts from Yanis Varoufakis’s memoir of the 2015 Greek crisis depict an EU where the Germans dominate and the Union, they insist, must be preserved at all costs. He claims that Emmanuel Macron, probably France’s next president, described the EU’s deal for Greece as a latter-day “Versailles Treaty”. Angela Merkel apparently overheard and barred Mr Macron from talks.

But Greece is not Britain: a great deal more for the Union is at stake this time around given the UK’s historic position of generating handsome contributions to EU coffers in Brussels.

Theresa May attracted shrill criticism for pointing out that continental security might be affected by the course of negotiations, yet the EU has shamelessly put absolutely everything on the table: the cost of the so-called divorce, from which they are determined to wring every penny, Gibraltar, UK bases in Cyprus and, in a concession to the French, an effort to stop any financial deregulatory drive by Britain.

The UK cannot accept a settlement that would, say, tie its hands on tax and regulation after it leaves the EU: the country voted to get out in part to liberate its economy. And there are matters on the table that have nothing to do with the EU – such as the future of Ireland. Britain therefore has to make it absolutely clear that it will not be drawn into diplomatic traps or be landed with bills and commitments that reduce its status and undermine the raison d’être behind Brexit.

The EU needs to be reminded that it relies so much on the UK’s markets, intelligence and military that it would be foolish to act so bullishly over the terms of settlement. It is in everyone’s interests to separate amicably and agree as soon as possible on a new trade arrangement. That is what Britain should aim for. If the Europeans will not play ball, however, they must be in no doubt that Britain has the strength and will to go it alone.

Brexit | Some of The European Union’s draft negotiation principles

 . The EU wishes to have the United Kingdom as a close partner in the future

. Preserving the integrity of the Single Market means that the UK will not be able to participate on a sector by sector basis

. The EU “four freedoms” are indivisible and there can be no cherry-picking

. A non-member of the Union cannot have the same rights and benefits as a member

. The EU will negotiate as a bloc, rather than 27 individual countries, so as not to undercut the position of the Union

. Brexit negotiations will take place as a single package. They will only be considered settled when all individual items are agreed

. The United Kingdom and European Union must agree on their future relationship, but these discussions can only take place when there is sufficient clarity on the process of the UK’s withdrawal from the Union

. The Union is open to a transitional membership agreement, but this must be very clearly defined, time-limited and dependent on the UK maintaining EU membership obligations

. Negotiations must be completed by 29 March 2019

. No part of these negotiations can affect Gibraltar without an agreement between the United Kingdom and Spain

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