7 The EU and Ukraine
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9706/13
+ ADDs 1-35
COM(13) 289
(b)
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9856/13
+ ADDs 1-35
COM(13) 290
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Draft Council Decision on the signing, on behalf of the European Union, and provisional application of the Association Agreement between the European Union and its Member States, of the one part, and Ukraine, of the other part
Draft Council Decision on the conclusion of the Association Agreement between the European Union and its Member States, of the one part, and Ukraine of the other part
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| Legal base | Articles 217 and 218 (5), (7) and (8) TFEU; unanimity
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| Document originated | 15 May 2013
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| Deposited in Parliament | 4 June and 12 June 2013
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| Department | Foreign and Commonwealth Office
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| Basis of consideration | EM of 14 June 2013
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| Previous Committee Report | None
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| Discussion in Council | To be determined
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| Committee's assessment | Politically important
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| Committee's decision | Not cleared; further information requested
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Background
7.1 In his Explanatory Memorandum of 14 June 2013, the Minister
for Europe (Mr David Lidington) explains that:
— relations
between the EU and Ukraine are currently based on a Partnership
and Cooperation Agreement that entered into force in 1998;
— in 2007, the EU and Ukraine began negotiations
on an Association Agreement that would deepen and broaden the
political and economic relationship;
— in 2008, following Ukraine's accession
to the WTO, negotiations were widened to include a Deep and Comprehensive
Free Trade Area;
— the Agreement process supports and encourages
reform in Ukraine to bring it closer to EU norms, as well giving
Ukraine gradual access to parts of the EU Internal Market;
— this Agreement, including a Deep and
Comprehensive Free Trade Area, is the first of its kind; and
— similar Agreements are being negotiated
with Moldova, Georgia, Armenia and Azerbaijan.
The draft Council Decision
7.2 The first proposal (document (a)) is the
legal instrument for authorising the signature and provisional
application of the Agreement; the second (document (b)), the legal
instrument for authorising the conclusion of the Agreement.
7.3 The Minister explains that:
— negotiations
were completed at the end of 2011 and the Agreement was initialled
in 2012;
— in December 2012, the Foreign Affairs
Council adopted Conclusions expressing the EU's commitment to
signing the Agreement as soon as Ukraine demonstrated progress
on:
- electoral reform;
- addressing selective justice; and
- implementing the reforms in the Association Agenda.[32]
— the
Conclusions indicated that if the conditions were met, signature
might be possible by the time of the Eastern Partnership Summit
in Vilnius in late November 2013;
— the Council also said that signature
might be accompanied by provisional application of parts of the
Agreement;
— provisional application "would be
a balance of economic and values issues of mutual benefit, and
be designed to encourage early reform";
— the exact composition of the scope of
provisional application has yet to be agreed.
7.4 As of now, the Minister says, the High Representative
and the Commission are monitoring developments in Ukraine, and
keeping the Council informed about progress by Ukraine to meet
the criteria set out in the December Conclusions:
"We received an interim progress report on 10
June in advance of the EU-Ukraine Cooperation Council meeting
on 24 June; we expect an assessment to inform the Council's final
decision in October or November on whether signature by the time
of the Vilnius Summit is appropriate."
7.5 The Minister then describes the Agreement
as follows:
"The section on Political Dialogue includes
dialogue and cooperation on domestic reform, and dialogue on foreign
and security policy including Common Security and Defence Policy.
The Justice, Freedom and Security section has a strong focus
on rule of law and the reinforcement of judicial institutions
and practices. It also covers migration, treatment and mobility
of workers, and cooperation on crime. The Free Trade Area part
of the Agreement covers a wide range of issues aimed at stimulating
growth in Ukraine and creating business opportunities for all
parties.
"The Economic and Sector Cooperation section
of the Agreement focuses on supporting core reforms to aid economic
recovery and growth in areas such as governance, energy, transport,
environmental protection, social development, equal rights, consumer
protection, education, training, youth and cultural cooperation.
The Agreement also includes sections on financial cooperation
and institutional issues.
"The contents of Addenda 2-35 are listed at
the end of the Agreement: 2-32 contain the technical details supporting
the Trade and Economic Cooperation sections; 33-34 contain the
three protocols to the Agreement; 35 is a joint declaration on
Agreements with other countries."
Subsidiarity
7.6 The Minister says:
"The Association Agreement is a mixed agreement
that will be signed by both the EU and its Member States. The
elements of the Agreement which fall within the exclusive competence
of the EU can only be agreed at EU level."
Legal and Procedural Issues
7.7 The Minister says:
"The Commission's Proposal cites Article
217 of the Treaty on the Functioning of the European Union
in conjunction with Article 218(5), the second subparagraph of
Article 218(8) and Article 218(7). The Government is currently
considering the appropriateness of these legal bases and whether
Protocol 21 to the Treaties (the JHA Opt-in) will apply.
"The preamble of the Association Agreement confirms
that provisions of the Agreement that fall within the scope of
Part III, Title V of the Treaty on the Functioning of the European
Union bind the UK and Ireland as separate Contracting Parties.
The proposed Council Decision on signature and provisional application
provides for the provisional application, as between the EU and
Ukraine, of a large part of the Agreement including matters relating
to CFSP, JHA, Intellectual Property, Maritime Transport and Energy.
The Government is now considering its position in relation to
the division of competences; however the provisional application
appears to go further than in other similar contexts such as the
EU-Central America Association Agreement. These issues are of
concern, and we are lobbying within working groups in Brussels
to ensure that the final scope of provisional application is consistent
with HMG policy to avoid competence creep."
Regulatory Impact Assessment
7.8 The Minister says:
"The Commission carried out an impact assessment
in 2007 at the start of the negotiations; we expect a further
assessment, but no date has been given. The UK will carry out
its own assessment and report to Parliament."
Financial Implications
7.9 The Minister says:
"Ukraine receives funding from the EC's European
Neighbourhood Programme that offers EU neighbours a privileged
relationship based on the common values of democracy, rule of
law and respect for human rights. An allocation of €470m
2011-2013 is supporting Ukraine's efforts towards good governance
and rule of law, assistance to the EU-Ukraine Association Agreement
and support to energy efficiency and environmental measures.
ENP funding for 2014-2020 including Ukraine is currently being
negotiated under the Multi Annual Financial Framework."
Timetable
7.10 The Minister says:
"We expect the proposed Council Decision on
signature and provisional application to be presented to the Foreign
Affairs Council in October or November 2013. Negotiations, including
on the legal base, will continue over the intervening months and
the FCO will provide further updates to the Parliamentary scrutiny
committees, via Ministerial letter, to reflect those negotiations.
It is unclear whether the Council Decision on Conclusion will
be presented at the same time. We will submit to the Parliamentary
scrutiny committees on UK ratification at the appropriate time."
The Government's
view
7.11 The Minister continues his comments as follows:
"Ukraine matters: its resource base, pre-eminently
in energy and agriculture, has potential to contribute powerfully
to the development of a European region resilient to 21st century
threats to its stability, prosperity and competitiveness. If
Ukraine continues on its current course, it will not fulfil this
potential. Nor will it do so if it yields to Russian pressure
to join the Customs Union, which would risk loss of sovereignty
and independence. Whilst we are sceptical that Ukraine will willingly
cede either, particularly in the short term, we judge that a closer
relationship with the European Union that holds open the prospect
of eventual membership is best way to encourage an independent,
successful Ukraine. The proposed Association Agreement, including
a Deep and Comprehensive Free Trade Area, is an essential milestone
on this path.
"The reforms supported by the Association Agreement
will, if implemented, help Ukraine become a free-market economy
underpinned by democracy and rule of law. Since President Yanukovych
came to power in 2010, we have seen worrying democratic back-sliding;
this led to the December Conclusions that set strict conditionality
for signature of the Agreement. Our policy has been to support
a closer relationship between the EU and Ukraine, while continuing
to make clear to Ukraine that they need to deliver demonstrable
improvements. The Foreign Secretary underlined this when he met
his counterpart on 13 May. The European Neighbourhood Policy's
report on Ukraine's progress in 2012 was disappointing, but we
believe that isolating Ukraine could slow progress further.
"The EU has much to gain from a closer relationship
with its eastern neighbours, but this has to be on the right terms.
The Foreign Secretary made clear to the Ukrainian Foreign Minister
that the decision on whether or not to sign the Association Agreement
this year could go either way, and they needed to demonstrate
a sustainable momentum for reform.
"Several Member States are concerned that if
the EU does not sign the Association Agreement Ukraine will move
closer to Russia. Ukraine recently signed a Memorandum on observer
status in the Eurasian Economic Commission, but it is unclear
what this means in practice. All of Ukraine's public rhetoric
remains firmly committed to an EU future. We judge that if Ukraine
were to integrate more closely with the EU and adapt to EU norms
and principles, it could send a very strong signal to Russia;
we continue to see Ukraine as the swing state in the region that
could have an exemplary effect on governance related change we
would like to see in Russia.
"The incarceration of former Prime Minister
Tymoshenko remains a factor in relations between the EU and Ukraine.
For some Member States her release may be a deciding factor in
their approach to signature of the Association Agreement. We
continue to call on Ukraine to reform its judicial system and
ensure equal and fair access to justice for all. Although they
have released some opposition politicians, the Ukrainians continue
to pursue a number of charges against Ms Tymoshenko."
Conclusion
7.12 There is plainly much to be determined
between now and the autumn. Whether it is possible to counteract
other tendencies by incentives that do not include the prospect
of closer association with the EU is a matter of judgement that
may merit debate.
7.13 We therefore ask the Minister to ensure
that the Committee is not presented by a fait accompli,
on the eve of the Council that will decide what to do next. His
officials are aware of the dates of our meetings in September
and October: we look to him to provide us with an assessment
in time for this important, precedent-setting agreement to be
debated if we so decide.
7.14 In the meantime, we shall retain the
documents under scrutiny.
32 Which are reproduced at the Annex to this chapter
of our Report, and are available at http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/EN/foraff/134136.pdf. Back
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