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CETA, a controversial agreement

November 19, 2018

Forging commercial agreements with the exterior constitutes one of the strength of the European Union. However, considering the increasing fears towards globalization and the innovations than Europe wanted to put into commercial agreement, the agreement with Canada has been welcomed with a civil dissatisfaction.

On the contrary, the European Commission has signed 44 previous commercial agreements without controversy with countries all around the world. Considering the falling of tariff rates, Brussels designed a more ambitious formula for new agreements. The idea was to transcend the area of the trade of goods putting emphasis on the so called second generation agreement. This second generation agreement fixes common rules to trade services and investments and accede to the public contracting in both signatory blocks and to fix certain standards. The agreement with Canada is the first agreement that incorporates these innovations.

CETA is the biggest commercial agreement that the EU has ever signed, especially for the access granted to European companies to give services in Canada. Europe and Canada already exchange every year 63,500 million Euros in goods and 27,000 million n services. In 2014, they registered 274,700 million of European investment in Canada, opposite to 166,000 million of Canadian money invested in the community block. The Commission hopes that the agreement injects 12.000 more million Euros into the European GDP and that it provides a major access for European companies in Canada.

The detractors of CETA show that the unification of some criteria with Canada probably can degrade the European norms. For example, if the agreement facilitates workers' mobility on both sides of the Atlantic Ocean, on the other hand Canadian labor norms are more flexible than the European ones. The principal objections are about how can we guarantee that it will not harm the European workers? And how to prevent that a Canadian investor imposes his rules when a clash broke out with the authorities of a state member?

We can see a political division, indeed the agreement was approved with 408 votes in favor, 254 against and 33 abstentions. Changes occurred in the agreement because, alarmed by the increasing political and social opposition, the EU created an exit. To guarantee that the agreement does not reduce European rights, the leaders approved an "interpretive instrument» that was added to the agreement and this approach is used for each of these grieves. The document guarantees that disputes between investors and authorities will be solved in a new public European court (not with a private arbitration). It supports the right of the workers to the collective bargaining and reinforces the environmental rules. Also it gathers the right of the European authorities to exclude some activities for example, the health or the education of the hands of companies.

Finally the approval can appeared only if all of the Heads of State and Governments are agreeing with CETA. Its final application will need the approval of all the national and regional competent parliaments. The motive of this agreement mixed the commercial aspects and, therefore, the pronouncement of the chambers of the state’s members is necessary. His future can be frustrated if some of these organs reject it.

For the future the agreement faces the risk to be the only relevant agreement of second generation which approves the EU. When Donald Trump arrived to the American presidency he erased off the map TAFTA, a very similar agreement that was negotiated by The United States and that surely will never see the light. The experts of the European Commission are now trying to cultivate classic agreements instead of aspiring to some complex and sensitive agreements for citizens.

Elisa Puerto.