Canada: Canada And Europe To Launch Free Trade Negotiations
Last Updated: January 19 2009

Edited by Milos Barutciski and Jesse Goldman

The Canadian government has initiated preliminary consultations with businesses and other stakeholders with regard to areas of potential interest to be pursued in free trade negotiations with the European Union (EU). This negotiation is potentially the most significant development in Canada’s international trade relations since the North American Free Trade Agreement (NAFTA) came into force in 1994. All indications thus far suggest that the proposed economic agreement would have a broader scope than either Canada’s or the EU’ s existing free trade agreements (FTAs), including NAFTA, thus opening a broader range of business opportunities.

On December 20, 2008, the Department of Foreign Affairs and International Trade (DFAIT) issued a notice soliciting submissions from interested parties to help identify their objectives, concerns and defensive interests in connection with a proposed new economic agreement with the EU. Companies that present their concerns and priorities to DFAIT at an early stage will be better placed to advance their interests in Canada’s opening position in the negotiations and in subsequent stages of the process.

This initiative follows the statement made jointly by Prime Minister Stephen Harper and French President Nicolas Sarkozy on October 17, 2008, when France held the rotating presidency of the EU, announcing that Canada and the EU intend to prepare formal mandates to launch negotiations on an ambitious economic partnership as early as possible in 2009. This announcement was closely followed by the announcement on December 9, 2008, of a multi-phased "Open Skies" agreement intended to greatly liberalize the market for air transport services and investment between Canada and the EU.

Background

With a population of almost 500 million and a GDP greater than €12 trillion, the EU represents an extremely attractive market for Canadian businesses. A new economic agreement between Canada and the EU would off er an immense opportunity for Canadian businesses to diversify into new markets for the supply of goods and services, including sophisticated value-added products and technology.

The EU is Canada’s second largest trading partner, with bilateral trade in goods and services accounting for approximately C$110 billion in 2007. Prior to the present initiative, Canada’s many overtures to the EU to initiate broad-based trade negotiations have failed to elicit engagement from the EU. The fact that Canada was only the EU’ s eleventh largest trading partner and that the Canadian economy is relatively open meant that there was little immediate impetus for the EU to begin negotiations. The EU’ s position began to shift in 2007 when the EU agreed to conduct a joint study with Canada into the costs and benefits of an expanded bilateral economic and trade relationship.

The joint study, Assessing the Costs and Benefits of a Closer EU-Canada Economic Partnership, was released on October 17, 2008. The study found that the economic benefits of a comprehensive bilateral FTA would be significant for both Canada and the EU. The benefit to Canada as a result of liberalizing trade in goods and services was projected to be an estimated C$12 billion over the first seven years of liberalization, whereas the benefit to the EU was even greater at approximately C$17 billion over the same period. In addition, the recent stalling of the multilateral trade negotiations under the WTO Doha Round created a further incentive for both Canada and the EU to pursue trade liberalizing initiatives elsewhere.

What’s At Stake

The proposed negotiation is expected to address a very broad agenda from the outset. Specifically, negotiation can be expected to include eff orts to achieve substantial liberalization of:

  • trade in goods, including elimination of customs duties and streamlining of customs procedures, reduction of non-tariff barriers in areas such as import licensing, technical and product standards, mutual recognition and conformity assessment;
  • trade in services, including further market access commitments in sectors not presently covered by either Canada’s or the EU’s commitments under the WTO General Agreement on Trade in Services;

  • investment, including addressing discriminatory provisions and other investment barriers at the provincial level for Canada and by Member States in the EU;
  • government procurement markets at both the provincial and Member State levels;
  • labour mobility, including facilitation of temporary entry and transfers of business personnel; and
  • mutual recognition of professional and technical qualifications.

Other areas such as open skies, enhanced regulatory co-operation, competition policy, environmental protection, climate change and emissions trading, labour rights and human rights, can also be expected to be brought into the negotiations.

The Road Ahead

At present, the Canadian government and the European Commission are engaged in a scoping exercise to determine the range of potential interests that will be affected by the negotiation from both offensive and defensive perspective. The Canadian government has initiated a formal consultation with business and other stakeholders. Although the European Commission has not yet initiated a similar public consultation, EU officials have initiated the process of identifying European negotiating interests. Among other things, senior European officials responsible for conducting the negotiations are expected to travel to Canada in the coming weeks. These developments, as well as statements by the current Czech presidency of the EU of its intention to initiate negotiations in the first half of 2009, indicate that the Canada-EU trade initiative is gaining momentum.

There are, of course, important hurdles to overcome. On the Canadian side, many of the areas that have been identified as prospects for further liberalization, such as procurement, trade in services and professional and technical qualifications, are under provincial jurisdiction. As such, the federal government will need to obtain positive provincial commitments in order to advance its negotiating agenda in these areas. Similarly, many areas of interest to Canada will have to be addressed by the EU’ s Member States, which will have their own interests to protect, notably in controversial areas such as agriculture, geographical indications and the use of genetically modified organisms and hormones in certain agrifood products. The global economic slowdown will also have an impact on the scope and pace of the negotiations, with the prospect of increased economic activity creating incentives for bold action while threatened sectors seek defensive carve-outs, exemptions and longer phase-ins or phase-outs.

On balance, the Canada-EU trade initiative represents the most significant international trade development for Canada in 15 years. The Canadian government’s consultations present an important opportunity for businesses to influence the parameters of the negotiations toward a potentially historic agreement that brings Canada and the EU closer together. For further information about the proposed Canada-EU negotiations, their potential impact on specific sectors or businesses, or responding to the Canadian government’s notice, please contact a member of our International Trade and Investment Practice.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Press Releases from this Firm
Recent Content from this Firm
By David Bursey, Sharon Singh
By J. Sébastien Gittens, Stephen Burns, Martin Kratz
By Dominique Hussey, L.E. Trent Horne, Jeilah Chan
By Conrad Druzeta, Michael Whitt
By Robert Staley, Jonathan Bell, Jessica Starck
By Dominique Hussey, L.E. Trent Horne, Jeilah Chan
By Jon Truswell, Nicholas Fader, Jeff Kerbel, Michael Barrett
By Venetia Whiting, Julia Schatz
By Isabel Langlois
By Martin Kratz
Tools
Print
Font Size:
Translation
Channels
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.