MEETING ON EU-VIETNAM FTA

Transcription

1 CIVIL SOCIETY DIALOGUE MEETING ON EU-VIETNAM FTA Date: 6 October 2015 Time: Location: Room Mansholt, Charlemagne Building Lead speaker Helena König, Director, Asia and Latin America, Directorate-General for Trade Panel Presentation Helena König gave an overview of the main elements of the agreement in principle for an EU-Vietnam FTA reached on 4 August. Both parties will dismantle more than 99% of tariffs over 7 years (EU) and 10 years (Vietnam) respectively. The EU s standard rules of origin will apply, including for textiles and clothing. Vietnam will also eliminate 90% of existing export duties and committed not to introduce any new ones. For services, Vietnam will go substantially beyond its existing GATS commitments in a number of sectors. On investment, Vietnam will remove or ease limitations in a number of manufacturing sectors. The discussions on investment protection and resolution of investment disputes are still on-going owing to a new EU approach. Under the FTA, 169 EU GI names will be protected at a level equivalent to the one provided by the relevant EU legislation. The IPR chapter more broadly will go beyond TRIPS standards across the board. Vietnam will open up its government procurement market at central level and in Hanoi and Ho Chi Minh City and will align its GP rules to a large extent to those of the GPA. Provisions on State Owned Enterprise will level the playing field between these entities and private operators when they operate in the market. The agreement will also eliminate non-tariff barriers in the automotive, pharmaceutical and renewable energy sector. Provisions in the area of SPS should ease EU exports to Vietnam through the different trade promotion tools (e.g. pre-listing and promotion of the EU as a single entity). Moreover, the FTA will contain a robust chapter on trade and sustainable development. Discussion Highlights / Questions and Replies While a number of associations welcomed the good outcome and speedy conclusion of the negotiations, they however regretted that the ratification process would take too much time (ESF, Euratex, FTA) with the exception of FIDH who asked for a more cautious approach in view of human rights issues.

2 Rules of origin Several associations inquired about product specific rules of origin (Zentralverband Elektrotechnik und Elektronikindustrie e.v., FoodServicesEurope), cumulation possibilities with Korea and other Asean countries and how these would be monitored (Euratex), and the direct transport rule (Spirits). The COM explained that the FTA only provided for bilateral cumulation between the EU and Vietnam, for cumulation with Korea for fabrics (subject to a system of administrative cooperation) and cumulation with ASEAN FTA partners for squid and octopus. Limitations for milk and sugar content would be expressed in weight. In setting the levels, EU export interests were taken into account. The agreement would also contain a non-alteration clause as opposed to the direct transport rule. Tariffs While expressing satisfaction with the high level of tariff elimination the Foreign Trade Association suggested that the potential benefits would be undermined by strict rules of origin and long staging periods. The COM will put the tariff eliminating schedules and the text of the agreement online (EBCA). The tariff dismantling periods for chapters 61 to 63 (EBCA) and 64 (The European Confederation of the Footwear Industry (CEC)) are proportionate to the level of sensitivities in those sectors in the EU. In case of an important surge, the Agreement will provide for a safeguard mechanism (The European Confederation of the Footwear Industry (CEC)). Spirits had observed that Vietnam was attempting to offset the tariff dismantling through increase of internal taxes. While internal taxes are not covered as such by the agreement, the Commission will monitor the situation and follow up as necessary. Customs and Trade Facilitation In response to a question from EBCA on customs and trade facilitation, the COM confirmed that the FTA includes a specific chapter which ensures that customs procedures are simplified and business-oriented and that controls should be based upon risk-management principles. Vietnam had also agreed to include the elements of the Bali WTO Trade Facilitation agreement in the CTF chapter. Services With regard to services, the FTA expressed concerns about the economic needs test, and cumbersome licensing procedures. The ESF asked for more details on the commitments offered by VN on maritime transport, cabotage, postal, Mode 4 and on how the issue of data flows and data localisation was addressed in the agreement. Eurocommerce was interested in distribution services, E-commerce and online services. COM informed that the EU services industry would get better access to Vietnam s market in a number of sectors, including in maritime services, and other services sectors. Vietnam will remove the economic needs test on outlets for retail services five years after the FTA comes into effect. In the meantime, no economic needs test will be required for outlets which are less than 500 square metres, apart from for the first one. Both sides also agreed on detailed provisions to ease the issuance of licenses. The e-commerce section corresponded to EU 2

3 standard language mirroring the WTO moratorium. Regarding data flows and localisation, Vietnam had put aside plans for stricter requirements. SOEs Upon a question from ESF, the COM confirmed that the SOE chapter will be subject to Dispute Settlement. Government procurement In response to a question from ESF, on the level of thresholds for goods and services in the government procurement chapter, the COM informed that Vietnam will benefit from transitional periods to align its thresholds to levels comparable with the ones introduced by GPA members for the various categories of goods and services to be procured. Investment protection FIDH inquired which model the COM would use for the investment protection negotiations with Vietnam. COM informed that it would discuss with Vietnam whether improvements could be introduced to the text under discussion based on some of the elements of the EU s new approach. SPS and animal welfare The Humane Society International/Europe inquired what had been agreed in respect of animal welfare. The COM informed that the provisions on animal welfare provided for enhanced cooperation of the two parties and would be placed in the cooperation chapter. The SPS Committee will be involved in the implementation of this cooperation. GIs The Associazione Italiana Consorzi Indicazioni Geografiche Consorzio asked about the outcome for EU GI names and the possible impact of TPP on GI protection in Vietnam. COM informed that 169 EU GI names will be fully protected under the FTA. The use of the terms Feta, Asiago, Fontina and Gorgonzola for products not complying with the specifications will be allowed under certain strict conditions. IPR The European Patent Office inquired about the outcome for patents, in particular for pharmaceuticals. FESI asked what measures will be taken to combat counterfeiting. The COM explained that the FTA will help improve Vietnam s system and simplify procedures. For pharmaceuticals, Vietnam will compensate for delays in marketing authorisation. On trademarks, Vietnam committed to simplify and develop its trademark registration procedures in line with international agreements. The IPR chapter also contains provisions to strengthen enforcement. 3

4 ECJ opinion on Singapore FTA FIDH wondered whether the entry into force of the Vietnam agreement would be dependent on the court s opinion on the Singapore FTA on whether it would be a mixed or EU only agreement. The COM expects to receive the Court opinion on the Singapore FTA before the ratification process of the Vietnam agreement starts. Whether the Vietnam agreement will be presented to Council for adoption as a mixed or EU only agreement will be decided at a later stage. Dispute Settlement In response to a question from Digital Europe, the COM confirmed that the FTA will contain a Dispute Settlement chapter. MES FESI wondered what had been agreed on the question of Market Economy Status. The COM explained that MES was not part of the FTA negotiations but that Vietnam expected to be granted MES before the end of the ratification process. TPP The Central Union of Agricultural Producers and Forest Owners wondered whether pressure was coming from TPP? The COM does not expect Vietnam to backtrack on any agreed issues. Vietnam has indeed done a fine balancing act to be able to close negotiations with both partners. Trade and Sustainable Development Euratex wondered how the COM would monitor progress on human/labour rights in Vietnam. Food services Europe inquired how the TSD chapter addressed fisheries. The Humane Society International/Europe was interested in the provisions on wildlife trade. The COM recalled the key commitments included in the TSD chapter on labour rights (implementation of all core labour standards and ratified ILO conventions, as well as progress towards ratification of non-ratified fundamental ILO conventions). The chapter also establishes dedicated structures to oversee the implementation of these commitments, ensuring dialogue at governmental level and guaranteeing the involvement of civil society in both the EU and Vietnam (with specific reference to independent social, environmental, and economic stakeholders). The COM outlined the provisions on the conservation and sustainable management of fisheries in the TSD chapter, explaining that they address, in particular, compliance with international agreements such as UNCLOS, fostering cooperation with RFMOs, fight against IUU and promotion of sustainable aquaculture. With regard to wildlife, it explained that that the agreement contains commitments to effectively implement ratified Multilateral Environmental Agreements, specific commitments to address illegal trade in wildlife and cooperation activities. 4

5 Human Rights The FIDH wanted to know how the COM would deal with Human Rights in relation to trade issues and what measures were planned to build capacity in Vietnam to enable its people to assess the impact of the FTA on human rights. The COM outlined the comprehensive approach on human rights encompassing several instruments, ranging from the PCA to development cooperation to the human rights dialogue. The COM referred to the civil society event that had taken place in May. The COM is also looking into flanking measures to accompany the implementation of the FTA. 5