Global Politics and EU Trade Policy

Table of Contents

1. Frontmatter

2. Introduction: EU Trade Policy Facing Unprecedented Challenges

   Wolfgang Weiß, Cornelia Furculita

   Abstract

   The introduction will describe the constant evolving global political context correlated to the events occurring, specifically, in the trade environment and the unprecedented challenges they pose for the EU Trade Policy. These identified and introduced challenges will be addressed in detail in the following book chapters. It will also introduce the reader to the individual contributions of the book and briefly present and anticipate the results attained.

3. EU Trade Policy in a Multipolar World: Pursuing WTO Reform and FTAs

   1. Frontmatter

   2. EU Multilateral Trade Policy in a Changing, Multipolar World: The Way Forward

      Wolfgang Weiß

      Abstract

      This chapter identifies the most pressing challenges for the EU multilaterally oriented trade policy due to the changing global context for international trade and investment, caused by the shift of the US towards unilateralism and protectionism and by the re-orientation of China’s exceptionalism towards becoming a more influential actor. It explores and assesses how EU trade policy copes with the new polarities and finally formulates proposals for the way forward for the EU multilateral trade policy. It will be shown that the current challenges are more fundamental in character and may last longer than currently anticipated. It will also highlight that maintaining unity in the EU determination of trade policy is of pivotal importance for addressing the challenges, which however might become more difficult.

   3. Tackling Technical Barriers to Trade in EU ‘New Generation’ FTAs: An Example of Open or Conflicting Regionalism?

      Iulianna Romanchyshyna

      Abstract

      This chapter analyses WTO-plus TBT provisions in ‘new generation’ EUFTAs in order to understand how the used approaches converge towards the multilateral system: whether they support and complement the existing rules, or instead contribute to regulatory fragmentation, which negatively impacts countries outside the preferential area. In a broader perspective, it inquires into the practical implementation of the EU’s strategic intentions to advance the multilateral agenda and to prioritize global inclusivity of rules, which is depicted as one of its main priorities in trade policy. The chapter first reflects on what could be the criteria for ‘open’ and ‘conflicting’ regionalism in case of TBT, which constitutes its theoretical underpinning, and then frames the TBT liberalisation provisions of ‘new generation’ FTAs.

   4. Financial Services Liberalization Under EU FTAs: The Case of Clearing and Settlement Services

      George A. Papaconstantinou

      Abstract

      This Chapter maps out how the liberalization of financial services in EU FTAs compares and contrasts with the multilateral trading system. The increasing importance of regional trade agreements in international economic law makes this exercise highly topical. This study assesses the liberalization depth of financial instruments’ clearing and settlement services in FTAs because of their prominence in the financial markets’ post-crisis reform. This Chapter’s findings indicate that the integration of financial services in EU FTAs goes beyond the threshold achieved at the WTO and that the EU strategically decides on what type of FTAs it pursues furthering the liberalization of financial services. In addition, the analysis reveals the existence of silos in WTO Member’s administrations between trade and finance teams.

   5. FTA Dispute Settlement Mechanisms: Alternative Fora for Trade Disputes—The Case of CETA and EUJEPA

      Cornelia Furculita

      Abstract

      This chapter investigates whether in the context of the Appellate Body crisis and the more developed substantive FTA norms, the dispute settlement mechanisms contained in EU FTAs, particularly CETA and EUJEPA, could emerge as attractive alternative fora for solving trade disputes. The chapter will analyze potential substantive and procedural aspects that would shape the answer to the posed question. It will argue that CETA and EUJEPA dispute settlement mechanisms could become only partial attractive bilateral alternatives to solve trade disputes between the parties. It will also show that there are certain aspects that will act against these mechanisms.

4. EU Trade Policy Facing Political Issues: The Rise of Asia, Globalization Critique, Values

   1. Frontmatter

   2. Exploring the Dynamic Nexus Between the European Union’s Trade and Foreign Policy Toward East Asia

      Xuechen Chen, Xinchuchu Gao

      Abstract

      The relationship between the European Union (EU) and East Asia appears to be at a turning point: on 19 September 2018, the European Commission and the High Representative of the Union for Foreign Affairs and Security Policy unveiled a Joint Communication entitled “Connecting Europe and Asia” that will have a far-reaching influence on the future relationship between the EU and Asia. This recent ambitious strategy can in fact be considered as a continuation of the EU’s mini “pivot to Asia”—namely a significant increase in engagement with Asian countries beyond the traditional focus on trade cooperation since 2012. The increasing cooperation between the EU and Asian partners in the socio-political and security spheres has attracted tremendous scholarly attention; however, the increasing nexus between the EU’s trade and foreign policy toward East Asia remains underexplored. This chapter aims to address this question by focusing on the evolving interconnectedness and dynamic links between the EU’s trade policy and its broader external policy toward East Asia. In particular, given the implications of the Lisbon Treaty on the interrelations between the EU’s trade and foreign policy, we seek to unpack how the EU’s trade policy fits into its wider strategy vis-à-vis the Asian region.

   3. EU Trade Policy in a Trade-Skeptic Context

      Louise Curran, Jappe Eckhardt

      Abstract

      This chapter seeks to provide some constructive input to the debate on EU trade policy. Drawing on academic research, including by the authors, as well as recent policy inputs from NGOs, Trade Associations and EU institutional actors, this chapter looks at how EU trade policy is evolving in response to its critics. In so doing, it explores the key challenges which the current context poses for policy-makers, highlights some of the ways in which trade policy has adapted to address recent challenges and provides some suggestions for further change.

   4. Non-Economic Values and Objectives in EU Trade Policy: Different Models of Externalization and Enforcement

      Urszula Jaremba

      Abstract

      The Treaty of Lisbon formally empowered the EU to conduct its trade policy in the light of a wide set of non-economic values and objectives such as human rights, sustainable development or international security, to name just a few. Clearly, this task of diffusing and safeguarding non-economic values externally poses a challenge for the EU and its trade policy. This paper aims at examining this challenge by providing a cross-cutting overview of the different ways and models of externalization of non-economic values that the EU can resort to in the field of international trade. In particular, the paper focuses on the mechanisms that accompany those models and which are there to ensure compliance with the envisaged values. The paper focuses on unilateral and bilateral action of the EU in the field of international trade and has both instrumental and conceptual character trying to review the general characteristics of the existent models and the respective ‘compliance mechanisms’ and the challenges attached to them.

   5. Deepening Trade and Fundamental Rights? Harnessing Data Protection Rights in the Regulatory Cooperation Chapters of EU Trade Agreements

      Isabella Mancini

      Abstract

      The paper explores the descriptive and normative intersection of Data Protection rights and Regulatory Cooperation chapters in the new generation of EU Trade Agreements. While the EU has repeatedly refused to consider data protection as part of trade negotiations, it has sought deeper institutionalised forms of regulatory cooperation. The question then arises as to what extent data protection rights would come across with these mechanisms and the consequences on their protection. In a context of global trade requiring data to flow freely, regulatory cooperation has been advanced as a way to deal with regulatory divergences in data. How should the EU deal with global demands pooling data flows and regulatory cooperation? The paper finds that data protection emerges as a very much cross-cutting issue liable to be affected by Regulatory Cooperation activities. It is argued that the EU should acknowledge this state of play whereby data protection cannot be isolated or only elusively addressed. Instead, mechanisms should be secured so as to ensure that data protection, as a fundamental right, is not undermined, and is embedded and enhanced in the regulatory cooperation chapters.

5. EU Trade Policy Addressing Protectionism: Trade Defence and Security Allegations

   1. Frontmatter

   2. The Devil Is in the Detail: A First Guide on the EU’s New Trade Defence Rules

      Frank Hoffmeister

      Abstract

      The article gives an overview about the main changes in the EU’s anti-dumping legislation. Going beyond the mere reproduction of the legislative changes on the new methodology (Regulation 2017/2321) and the modernisation (Regulation 2018/825), the author gives a first-hand guide on their possible interpretation and use in practice. He argues that the new rules keep the main political balance between the protection of producing interests and the respect for importing interests and downstream industry in intact. However, Hoffmeister also opines that in many instances the “devil is in the detail” when it comes to the application of the new rules.

   3. Are the EU’s Trade Defence Instruments WTO Compliant?

      Edwin Vermulst, Juhi Dion Sud

      Abstract

      This contribution provides a critical analysis of the law and practice of the European Union’s trade defence instruments in light of the European Union’s World Trade Organization obligations. It finds important shortcomings notably in the application by the European Union of its anti-dumping and anti-subsidy instruments and, to a lesser extent, the safeguard instrument. The aggressive use by the European Union of its trade defence arsenal seems fueled by its inability to address perceived trade irritants such as export restrictions and market access problems of some trading partners more directly. However, if the past is any guide, it is just a question of time before World Trade Organization litigation puts an end to such ‘détournement de pouvoir’ of trade defence instruments.

   4. Interpreting Essential Security Exceptions in WTO Law in View of Economic Security Interests

      Wolfgang Weiß

      Abstract

      After the invocation of security exceptions became more common, the first panel report ever on how to apply them has recently been issued in the Russia—Measures Concerning Traffic in Transit case. While this panel addressed the application of the security exception in a situation of threat to international peace and security, the question must be raised whether its approach also applies to the invocation of security exceptions for economic reasons. In this context, the present chapter focuses on the methodical preliminaries to applying security exceptions: Its application in WTO dispute settlement does not only prompt the question of the jurisdiction of WTO panels and the Appellate Body, but also pertains to the issues of standard of proof and standard of review. A related methodical issue concerns the feasibility of the expansive interpretive approach applied to the general exceptions to the security exception. Reading it in the same tune runs the risk of nullifying the concept of multilateral trade regulation altogether, even more so as the security exceptions miss the usual safeguard against abuse, i.e. the requirements of the general exceptions’ chapeau. The lack of such safety valve confirms that security exceptions are of a different character compared to other exceptions. This difference, however, may be difficult to maintain if security exceptions are also used to defend economic security interests. Finally, the application of security exceptions may—as debated with regard to other WTO exceptions—be subject to an inherent limitation against exterritorial application, which would restrain its scope of application in cases in which security measures against a third country intend to affect also the trade of WTO Members, and could become relevant in assessing US sanctions against Iran.