Photo of child and woman with peas to illustrate story saying Commission's CETA proposal violates EU law

Commission’s CETA proposal violates EU law

The Commission’s proposal on provisional application of the Canada-EU trade agreement (CETA) violates EU law.

The EU can only provisionally apply those parts of the international agreement over which it has exclusive powers. However, in today’s proposal, the Commission is seeking to provisionally apply CETA in its entirety. This violates the founding treaties of the EU.

The Commission has already shown it is not sure it has the power to do this, by asking EU judges to rule on the division of power in the EU-Singapore Free Trade deal. This judgement is expected later this year or early next year.

Instead of waiting for this important Court ruling, the Commission is hastily pushing for a decision that may be contrary to what the ECJ decides.

Three ways the Commission’s CETA proposal violates EU law

The Commission is acting ultra vires (outside its powers) because the Commission’s proposal violates the EU’s basic constitutional principle of conferral in three ways:

  1. Firstly, the Commission is proposing the signature and conclusion of CETA as a mixed agreement. This means that the Member States are exercising their powers and are responsible for at least some part of CETA. As a consequence, the EU cannot provisionally apply the agreement in its entirety, simply because some provisions remain within the powers of the Member States.
  2. Secondly, the Commission is proposing to provisionally apply the investment chapter. However, that chapter also covers portfolio investment. The EU only has exclusive powers over foreign direct investment, and not over portfolio investment. Therefore this chapter cannot be provisionally applied.
  3. Thirdly, the Commission is proposing provisional application as a separate decision from the decision to sign CETA on behalf of the EU. However, article 218 (5) TFEU states that the Council, on a proposal by the negotiator, shall adopt a decision authorising the signing of the agreement and, if necessary, its provisional application before entry into force. This implies that this is one and the same decision and not two separate decisions. In the past, the practice has been that the decision on provisional application is taken as part of the decision to sign the agreement on behalf of the EU.

In any event, the Commission’s proposal is at odds with Commissioner Malmström’s statement that:

“[E]ven if the power to decide on provisional application lies with the Council, (…) I am ready, when proposing decisions to sign politically important trade agreements which fall under my responsibility, to ask the Council to delay provisional application until the European Parliament has given its consent.”

Commissioner Malmström could have waited with this proposal until after the consent vote in the European Parliament in order to strengthen the credibility of her claims that she believes that the European Parliament needs to be involved.

Share this...
Share on Facebook! Tweet this! Share on LinkedIn! Email!

William Bottini