Canada, EU Sign CETA; Future Uncertain

Canadian Prime Minister Justin Trudeau participates in the Comprehensive Economic and Trade Agreement signing ceremony with President of the European Commission Jean-Claude Juncker (left) and President of the European Council Donald Tusk (right) at the Council of the European Union in Brussels, Belgium Sunday October 30, 2016. THE CANADIAN PRESS/Adrian Wyld

Canadian Prime Minister Justin Trudeau and members of the European Council signed the Comprehensive Economic and Trade Agreement (CETA) October 30, which purports to remove 99% of trade tariffs between the two regions.

It’s been a bit of a rocky road for passage of CETA, and may continue to be one regarding its implementation, with the BBC reporting:

“The signing ceremony initially planned for Thursday had been cancelled after Belgium’s Wallonia region vetoed the agreement.

All 28 EU states approved the deal on Friday when consensus was reached…

The deal was due to be signed at 11:00 local time (10:00 GMT), but was postponed after Mr Trudeau’s plane had to turn back to Ottawa airport after experiencing “mechanical issues” shortly after take-off….

CETA was approached with goodwill on all sides. Still it took seven years.

CETA is about removing trade barriers. Brexit may discuss which ones to put up.

If the UK limits the movement of people, will the EU seek to do the same? And what other barriers may come, too?

And will political parties and leaders around Europe now follow the Walloons and bargain hard over Brexit, too?”

The Globe And Mail reported October 27 Tentative deal puts CETA back on track as text reveals countries can opt out of dispute court:

“A tentative deal has been reached to put the massive Canada-EU free trade deal back on track for approval by European leaders, but negotiations in Belgium have revealed that the most contentious part of the accord – a court where businesses can sue another country’s government – has an uncertain future…

‘It would be suspended during the ratification process, and that could take a couple of years,’ said Hamza Fassi-Fihri, a member of parliament in the Brussels city government, one of Belgium’s regional governments. ‘During this period, the European Commission would commit to improve the system and to go towards a model of a multilateral international court system instead of the [dispute resolution process].’

Mr. Fassi-Fihri said MPs want assurances that changes to the mechanism will be part of the treaty and not a side arrangement. ‘We need guarantees about that.’

He also said Belgium could still reject CETA despite Thursday’s agreement.

Toronto-based trade lawyer Mark Warner said the fact all 28 Parliaments will get to decide whether they want to accept the investor-state dispute mechanism was set in motion back in July when the European Union chose the system under which member countries would approve CETA. Back then, the EU said this would be treated as a ‘mixed agreement’ where all country’s legislators would have the power to agree or reject matters that entirely within their jurisdiction.

Mr. Fassi-Fihri said it is also unclear if Canada will agree to the changes to the mechanism or if modifications will apply to Canada. ‘If it’s a document that has a legal value and that is added to the treaty but Canada is not around the table now discussing and negotiating, would Canada be obliged to comply with the treaty with these extra documents or only be compelled by the treaty and not the extra documents?’”

Either way, full ratification still requires an affirmative vote by all member state parliaments. Whether that is going to happen and if so how long that is going to take, and how many more amendments need to be added to this 1500+ page “free trade” agreement that probably very few Europeans have actually read, remains to be seen.

What could possibly go wrong?

This article was edited for grammar, style, and spelling, but not for content. The views expressed are that of the author, Nima Mahdjour, exclusively, and do not reflect that of BeingLibertarian.com or Being Libertarian LLC

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nima1981@gmail.com'/
Nima is an entrepreneur and Bitcoin advocate who writes about economics and freedom. He was born and raised in Berlin and received his Master's degree in the US in 2004. He co-founded an auction software company in San Francisco and successfully sold it in 2015. (Twitter: @economicsjunkie)

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