News from the European Commission
Robust new trade enforcement rules have entered into force that
will further strengthen the EU's toolbox in defending its
interests. With the update of the EU's Trade Enforcement
Regulation, the EU is able to act in a broader range of
circumstances.
The new rules upgrade the EU's enforcement by introducing the
following changes:
- empowering the EU to act to protect its trade interests in
the World Trade Organization (WTO) and under bilateral
agreements when a trade dispute is blocked despite the EU's
good faith effort to follow dispute settlement procedures (the
regulation previously only allowed action after the completion
of dispute settlement procedures); and
- expanding the scope of the regulation and of possible trade
policy countermeasures to services and certain trade-related
aspects of intellectual property rights (IPR) (the regulation
previously only permitted countermeasures in goods).
Executive Vice-President and Commissioner for Trade, Valdis
Dombrovskis, said: “The European Union must be
able to defend itself against unfair trading practices. These
new rules will help protect us from those trying to take
advantage of our openness. We continue to work towards our
first preference, which is a reformed and well-functioning
multilateral rulebook with an effective Dispute Settlement
System at its core. But we cannot afford to stand defenseless
in the meantime. These measures allow us to respond resolutely
and assertively.”
In line with the Political Guidelines of Commission President
Ursula von der Leyen, the Commission is further
reinforcing the Union's tools to focus on compliance and
enforcement of the EU's trade agreements.
Ensuring the respect of the commitments agreed with other trade
partners is a key priority of this Commission. The EU is
therefore increasing the focus on enforcing its partners'
commitments in multilateral, regional and bilateral trade
agreements. In so doing the Union will rely on a suite of
instruments.
Background
The proposal to amend the existing Enforcement Regulation came
as a reaction to the blockage of the operations of the WTO
Appellate Body. The current regulation – a basis under EU law
for adopting trade countermeasures – requires that a dispute
goes all the way through the WTO procedures, including the
appeal stage, before the Union can react. The lack of a
functioning WTO Appellate Body allows WTO Members to avoid
their obligations and escape a binding ruling by simply
appealing a panel report.
The revised Regulation enables the EU to react even if the WTO
has not delivered a final ruling because the other WTO member
blocks the dispute procedure by appealing to the
non-functioning Appellate Body and by not agreeing to an
alternative arbitration under WTO Dispute Settlement Agreement.
This new mechanism also applies to the dispute settlement in
relation to regional or bilateral trade agreements to which the
EU is party if a similar blockage arises. The EU must be able
to respond resolutely in case trade partners hinder effective
dispute settlement resolution, for instance, by blocking the
composition of panels.
Anti-coercion mechanism
As part of the agreement, the Commission committed to
developing the EU's anti-coercion mechanism swiftly. As
announced in the Letter of Intent of the President of the
European Commission to the President of the European Parliament
and President in office of the Council of 16 September 2020 the
Commission shall adopt the proposal on the anti-coercion
mechanism no later than the end of 2021. The anti-coercion
mechanism is also included in the European Commission's 2021
Work Programme.
Additional efforts on implementation and
enforcement
In addition to upgrading the Enforcement Regulation and to
proposing an anti-coercion mechanism, several other steps have
been taken since the start of this Commission to strengthen and
target EU implementation and enforcement efforts. This
includes:
- the appointment of a Chief Trade
Enforcement Officer;
- the creation of a new Directorate in DG Trade for
enforcement, market access and SMEs; and
- the establishment under Access2Markets of
a single entry point for complaints from EU stakeholders and
businesses on trade barriers on foreign markets and
violations of sustainable trade commitments in EU trade
agreements.
For More Information
The amended
Regulation
Infographic
