EU pushes to approve Japan trade deal, seeks to avoid CETA mistakes

European Commissioner for Agriculture and Rural Development Phil Hogan (L) and European Commissioner for Trade Cecilia Malmstrom (2-L) are invited by Japanese Foreign Minister Fumio Kishida (2-R) and Japanese Agriculture, Forestry and Fisheries Minister Yuji Yamamoto (R) to a working dinner as a part of the Japan-EU Economic Partnership Agreement negotiations at Iikura guest house in Tokyo, Japan, 30 June 2017. [Frank Robichon/Pool/EPA/EFE]

The European Commission will put forward a proposed free-trade agreement with Japan for fast-track approval today (18 April), hoping to avoid a repeat of the public protests that nearly derailed a trade pact with Canada two years ago.

The European Union and Japan concluded negotiations to create the world’s largest economic area in December, signalling their rejection of the protectionist stance of US President Donald Trump. Now they want to see it go into force.

The agreement would remove EU tariffs of 10% on Japanese cars and the 3% rate for most car parts. It would also scrap Japanese duties of some 30% on EU cheese and 15% on wines, and secure access to large public tenders in Japan.

The commission, which negotiates trade agreements for the EU, will present its proposals to the 28 EU members, along with another planned trade agreement with Singapore. EU countries, the European Parliament, and the Japanese parliament will have to give their assent before the trade pact can start.

The EU is mindful of protests against and criticism of the EU-Canada Comprehensive Economic and Trade Agreement (CETA) in 2016, which culminated in a region of Belgium threatening to destroy the deal. It provisionally entered force last September.

CETA goes live, but not without foes

On Thursday (21 September), the EU-Canada trade agreement enters provisionally into force, sparking a rehash of old claims.

Both Brussels and Tokyo want to ensure the agreement can enter force early in 2019, ideally before Britain leaves the EU at the end of March. If it does, it could apply automatically to Britain during a transition period until the end of 2020. Otherwise, it might not.

Brexit fallout

Many of Japan’s carmakers serve the EU from British bases, and it has said having a deal in force during the transition would buy it more time to establish a separate trade agreement with Britain.

Brexit to decide future of Japanese car industry in the UK

Japanese car manufacturers with most of their production sites in the UK will lose access to the single market following Brexit, and are consequently threatening to leave. EURACTIV.fr reports.

One reason the Japan deal may get rapid approval is that it does not deal with investment protection, which critics say allows multinational companies to influence public policy with the threat of legal action.

The agreement could then enter force after approval by the national governments and the European Parliament, rather than also having to secure clearance from national and even regional parliaments.

In fact, EU and Japanese negotiators have not agreed on the way in which foreign investors should be protected.

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