CARS Meeting of the Working Group "Trade and International Harmonisation"
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1 CARS 2020 Meeting of the Working Group "Trade and International Harmonisation" 2 July
2 International Harmonisation CLEPA supports the EU Commission in reviewing the UN 1958 Agreement Welcomes achievements at the IWVTA working group, with most of CLEPA proposals in draft revised Agreement Hopes the final draft text can be submitted to WP.29 in November 2013 as scheduled CLEPA supports principle of the International Whole Vehicle Type Approval (Regulation R0) But has some concerns on potential Barriers to Trade for replacement parts: rights and duties of countries applying R0 with regard to the other UN Regulations. 2
3 International Harmonisation CLEPA supports Global Harmonisation under the GTR process under the UN 1998 Agreement Would welcome common transposition in national/regional legislations, e.g. via the TTIP process with the USA. CLEPA supports NTB elimination via bilateral negotiations UN 1958 Agreement where relevant: the partner should apply the Regulations the EU is applying, or accept UN approvals and markings. Bilateral agreements should support Global Harmonisation. WP.29 must remain the only Harmonisation Forum. 3
4 Trade - Overall Objectives Gain access to the world s largest and most dynamic economies Maintain a solid production and employment hub within the European Union Strengthen our competitiveness in face of ever-growing challenges, in the face of increasing competition from BRIC countries, MERCOSUR & ASEAN markets Any EU Free Trade Agreement concluded should benefit ALL segments of the automotive industry and favour both exports and foreign indirect investments, achieving a mutually-beneficial global level-playing field 4
5 EU Free Trade Agreements General principles Liberalisation - full tariff dismantling (0% for 0%) Abolition of all NTBs (e.g. barriers restricting imports; restrictive import licences; state subsidies; export subsidies; Buy national policies; IPR abuse; unfair customs procedures, TBTs.) Duty Drawback must be reciprocal, against one-party DDB, as otherwise unfair trade advantage 5
6 EU Free Trade Agreements General principles EU Rules of Origin, support for 40% non-originating content, should strive for worldwide harmonized and easy to handle RoO for all FTAs Insertion of clauses in EU FTAs to address trade balance deficits, i.e. bilateral safeguard measures; strict binding Dispute Resolution Mechanisms; safety clauses Impact Assessments should be conducted prior to the launching of each EU FTA 6
7 Bilateral Trade Negotiations Japan Import stats (Chapter 8708: auto parts and accessories): EU exports down 5.09% YTD March 2013 EU trade deficit $3,6bn in 2012 CLEPA concerned by status of NTB discussions (status not clear), which is prerequisite for further discussions: Application of new UN Regulations under the 1958 Agreement: published Japanese Road Map far from CLEPA request (e.g. application after modifications, no Heavy Duty UN Regulations). No withdrawal from application of UN Regulations, even when IWVTA R0 exists. If new legislation, apply the corresponding UN Regulation when existing. Automotive pyrotechnic articles to be exempted from Japanese High Pressure Gas Act and Explosion Control Act: no news. Conditions NTBs, bilateral safeguard, Dispute Resolution Mechanism, safety clause to protect against surge of imports; to encourage EU export potential 7
8 Bilateral Trade Negotiations USA CLEPA supports the TTIP discussions Question mark for Regulatory Convergence: How mutual recognition of existing regulations to be assessed, then implemented Legal certainty 8
9 Bilateral Trade Negotiations India CLEPA insists on full tariff liberalisation, but with longer transitional periods, 57 of our competitive lines remain on the negative lists India offer to liberalise only the basic import duties (around 7.5%), accounting for around a 1/3 of all aggregated import taxes - unacceptable. NTB sectoral Annex - list of equivalence between Indian standards and UN Regulations, now seems no-go Is EU India FTA still doable, at the level of ambition we want? We prefer no FTA rather than a one not matching our ambitions. 9
10 Bilateral Trade Negotiations Canada The use of non-originating materials classified in any other heading without any restrictions OR change of tariff heading The use of non-originating materials classified in the same heading 8708, provided that the value of these materials does not exceed 50% of the value of the product 10
11 Existing Free Trade Agreements Korea Import stats (Chapter 8708: auto parts and accessories): EU exports down 22.28% YTD March 2013 EU trade deficit $2,16bn in 2012 Korean replacement parts mandatory certification For putting parts on their market, Korea should accept the UN Type Approval certificates, UN test reports and the UN marks where relevant. Danger that other like-legislation is in pipe-line List of equivalent requirements to be expanded to missing UN requirements and latest adopted ones. Market access - EU suppliers: little success in getting onto Korean platforms (similarities between Japan & Korea Keiretsu ) where is the business potential? 11
12 Other Trade Issues China Key market access barriers: CCC Compulsory Certification System Raw materials, export restrictions (e.g. export duties and quotas) IPR lengthy and costly notarisation and legalisation procedures Public Procurement an active Buy Chinese policy China s 2011 Foreign Investment Catalogue 50% ownership cap in JVs for key components of NEVs and batteries China s excessive data requests (sensitive commercial info); export financing, export subsidies 12
13 Other Trade Issues Brazil Brazil INMETRO regulation on obligatory approval and marking of auto parts Press for acceptance of equivalency of UN 1958 requirements INOVAR-AUTO & Plano Brasil Maior, aim to increase localisation. Effects: deter EU exports, reduce competitiveness, high risks for new business acquisition; unknown details for startup & localization plans in ; high risk of delaying startup & localization activities due to unclear governmental regulations 13
14 Other Trade Issues Argentina Argentina trade distorting measures challenged: the pre-registration and pre-approval import regime (DJAI) still in force for auto parts requirement that Argentine importers balance their imports with exports 14
15 Conclusion on Trade The influence of foreign industrial and trade policies, i.e. protectionist measures ongoing in: Korea, Japan, India, China, MERCOSUR, etc... have a direct impact on the competitiveness of EU industry The Commission must help challenge these measures! 15
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