12 The EU and Georgia: the EU and Moldova
| Committee's assessment
| Legally and politically important |
| Committee's decision | Cleared from scrutiny (by Resolution of the House on 10 June 2014)
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| Document details | (a) Draft Decision on the signing and provisional application of the Association Agreement with Georgia; (b) Draft Decision on the conclusion of the Association Agreement with Georgia; (c) Draft Decision on the signing and provisional application of the Association Agreement with Moldova; (d) Draft Decision on the conclusion of the Association Agreement with Moldova
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| Legal base | Articles 217, 218(5), 218(7) and 218(8) TFEU; unanimity
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| Department | Foreign and Commonwealth Office
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Summary and Committee's conclusions
12.1 Relations between the EU and Georgia and the EU and Moldova
are currently based, respectively, on 1999 and 1998 Partnership
and Cooperation Agreements. The proposed separate Association
Agreements (AA) would deepen and broaden the political and economic
relationship, with a Deep and Comprehensive Free Trade Area (DCFTA)
as a key part: support and encourage reform in both countries,
bring them closer to EU norms, and provide gradual access to parts
of the EU Internal Market. The Agreements were initialled at the
Vilnius Eastern Partnership Summit in November 2013.
12.2 These Council Decisions, which were adopted
on the 16 June, enable the EU to (a) sign, and provisionally apply
part, of each agreement, and (b) conclude each Agreement.
12.3 In scrutinising these proposals we have been
concerned to identify potential EU competence creep — either
by the EU signing and concluding any part of these Agreements
for which it did not have exclusive competence, or by provisionally
applying provisions in the Agreements for which it did not have
exclusive competence. That is why, in our Report of 11 June,
which considered relevant letters from the Minister for Europe
(Mr David Lidington) that were sent too late to be reported to
the House in time for that debate, we asked the Minister to confirm
that — with the exception of those elements covered by declarations
— he was satisfied that the EU was entering into these Agreements,
and provisionally applying them, only to the extent that it has
exclusive competence, leaving Member States to act in matters
of shared competence. The matter was discussed in the debate in
European Committee B on 9 June.[36]
12.4 Since then, the Minister has also provided further
information with regard to the Ukraine Association Agreement.
As we report in chapter 13 the UK lodged, at the time of adoption
of the Decision enabling the EU to sign and provisionally apply
that Agreement, a statement that "The provisional application
of those areas of previously unexercised shared competence within
the trade elements of the Association Agreement shall not prejudice
the discretion of Member States within the Council to determine
areas for provisional application within future trade agreements
with third parties entered into by the European Union". Like
the Ukraine Agreements these Agreements also include very significant
"trade elements" but there have not been similar statements
lodged with these Decisions.
12.5 These proposals also gave rise to a different
legal issue as to whether the UK opt-in applies. The Committee
has consistently taken the view that the UK opt-in is not engaged
unless the measure in question cites a legal basis from Title
V of Part Three of the TFEU concerning an area of freedom security
and justice. In these cases the Government sought, but failed
to secure this. The Minister has provided an indication of the
minimal impact of these provisions, plus further information on
the monitoring of the Agreements and the change to the EU's restrictive
measures concerning Transnistria.
12.6 Although the Minister's further letter does
not provide the unequivocal confirmation in respect of EU competence
that we were seeking, it could be inferred from it that he considers
the EU is only provisionally applying these Agreements to the
extent that it has exclusive competence, save for provisions covered
by declarations. Whilst we acknowledge the extent to which the
Government has sought to circumscribe the exercise of competence
by the EU, it is nevertheless clear that the UK has, contrary
to usual practice, acquiesced in the exercise by the EU of shared
competence in respect of those provisions of the Agreement covered
by declarations. As we said in our previous Report, because they
are not legally binding, such declarations can only alleviate,
not remove, competence concerns.
12.7 Furthermore we note that a statement was
made by the UK in relation to the Ukraine Association Agreement
seeking to avoid creating a precedent in respect of "The
provisional application of those areas of the previously unexercised
shared competence within the trade elements of the Association
Agreement". These Agreements also contain extensive trade
elements which, judging by this statement, could include matters
of shared competence. We ask the Minister whether this is indeed
the case, and, if so, to explain why no similar statement has
been made by the UK in respect of these Agreements.
12.8 In any event, in future such cases, we ask
the Minister to:
· identify
clearly from the outset those elements of the international agreement
in question where the EU has exclusive competence,
and
· provide
a clear explanation of areas where competence is shared and in
which the EU is acting and a clear explanation of the Government's
position.
12.9 In the absence of a Title V legal basis,
the Committee continues to abide by its view that the UK opt-in
has not been engaged in respect of these Decisions.
12.10 With regard to monitoring arrangements,
the Minister has provided what is essentially a "To Do"
list against which each country's progress will be assessed in
the years to come. We ask the Minister to confirm that:
· now
that these Association Agendas have been adopted by the 23 June
Foreign Affairs Council, they are in the public domain and need
no longer be treated on the "for your eyes only" basis
upon which he has provided them; and
· the
annual monitoring reports that the Minister says he will "share"
with the Committee will be deposited and accompanied by an Explanatory
Memorandum setting out the Minister's views on how well the Agreements
are actually working.
Full details of
the documents: (a) Draft
Council Decision on the signing and provisional application of
the Association Agreement between the European Union and the European
Atomic Energy Community and their Member States and Georgia: (35897),
7941/14 + ADDs 1-13, COM(14) 148; (b) Draft Council Decision on
the conclusion of the Association Agreement between the European
Union and the European Atomic Energy Community and their Member
States and Georgia: (35898), 7942/14 + ADDs 1-13, COM(14) 149;
(c) Draft Council Decision on the signing and provisional application
of the Association Agreement between the European Union and the
European Atomic Energy Community and their Member States and Moldova:
(35894), 7943/14 + ADDs 1-14, COM(14) 157; (d) Draft Council Decision
on the conclusion of the Association Agreement between the European
Union and the European Atomic Energy Community and their Member
States and Moldova: (35895), 7944/14 + ADDs 1-14, COM(14) 146.
Background
12.11 These Council Decisions, which were adopted
on the 16 June, enable the EU to (a) sign, and provisionally apply
part, of each agreement, and (b) conclude each Agreement. Provisional
application serves to "bridge the gap" between signature
and ratification, which involves all Member States national parliaments
and normally takes up to two years.
12.12 In scrutinising them we have been concerned
to identify potential EU competence creep, as we have already
noted.
12.13 The declarations cover provisions relating
to:
— the
outline in each Agreement of the general principles which underlie
it;
— conflict
prevention and crisis management, regional stability, and peaceful
conflict resolution; and
— the
rule of law.
12.14 These proposals also give rise to a different
legal issue, whether the UK opt-in applies. There are two provisions
of each of the Agreements where the Government considered that
the UK opt-in applies — the re-admission provisions and
the provisions concerning the supply of mode 4 services (where
the service is provided cross-border through the presence of a
person in another country). On 26 June, the Minister informed
the House, by written Ministerial Statements, that the UK had
opted into these Decisions. However the Committee has consistently
taken the view that the UK opt-in is not engaged unless the measure
in question cites a legal basis from Title V of Part Three of
the TFEU concerning an area of freedom security and justice.
The Government sought, but failed to secure, the use of a Title
V legal basis.
The Minister's letter of 26 June 2014
12.15 The Minister addresses the issue of competence
as follows:
"You raise the question of the EU's provisional
application of elements of the Agreements. Where the competence
lies with Member States we have been very clear that those elements
cannot be provisionally applied by the EU. Where competence is
shared between the Member States and the EU we have been equally
clear that the EU cannot provisionally apply any of the elements
where the EU has not previously exercised that shared competence.
However, there are some elements covered by shared competence,
where the EU has previously acted, and where the UK Government
judged it was in our interests for them to be provisionally applied.
We therefore agreed to that provisional application.
As outlined in my previous
letters and the debate, we have agreed a joint declaration on
those areas of each Agreement where the Government had concerns
about the division of competence."
12.16 The Minister provides further information on
the impact of the provisions concerning Mode 4 services from Georgia
and Moldova, as follows:
"During the 9 June debate, the issue of
Mode 4, and its impact on immigration to the UK, was raised. In
large part, the Mode 4 provisions of these Association Agreements
reaffirm commitments by which the UK is already bound by virtue
of the Mode 4 provisions of the General Agreement on Trade in
Services (GATS), and from which service suppliers in Georgia and
Moldova already benefit by virtue of those countries' membership
of the World Trade Organisation. These Association Agreements
would require the UK to implement some additional commitments
in respect of contractual service suppliers and independent professionals,
but these are subject to rigorous safeguards in terms of required
skill levels and length of stay, and are limited to specific sectors.
"Only 32 Georgian and Moldovan nationals
were issued with entry clearance in 2013 in those immigration
categories which implement the UK's Mode 4 existing commitments
for workers, and the Government would not expect this picture
to change substantially as a result of the implementation of the
new Agreements."
12.17 The Minister recalls that the monitoring of
Georgian and Moldovan progress on reform was also discussed during
the 9 June debate, and says:
"This monitoring process will be founded
on Association Agendas concerning each country, replacing (and
being analogous to) the respective European Neighbourhood Policy
(ENP) Action Plans. The two Association Agenda [s] for the next
three years have now been agreed and were adopted at the 23 June
Foreign Affairs Council. Although these documents are not subject
to Parliamentary scrutiny, I attach them to this letter for your
Committee's information. Please note these documents have not
yet been made available to the general public.
"The EEAS will produce annual monitoring
reports for each country, which the Government will continue to
share with your Committee."
12.18 Finally, the Minister says that he would "also
like to take this opportunity to draw to your attention to a change
on the EU's restrictive measures concerning Transnistria",
which he does thus:
"In the past, Parliamentary scrutiny of
the annual review of these sanctions has been difficult because
of the imperative to agree a Decision in advance of expiry of
the sanctions (30 September), while Working Group discussions
only started in early September due to the summer break in Brussels.
At the most-recent informal review, the UK pressed the institutions
and other Member States to extend the expiry date of the sanctions,
from 30 September, to 31 October. This has now been agreed and
formally adopted at the Foreign Affairs Council on 23 June. I
was very grateful that you agreed to waive scrutiny for this small
technical change. We hope this change will mean your Committee
will in future have the proper time to perform scrutiny of the
EU's restrictive measures concerning Transnistria."
Previous Committee
Reports
Second Report HC 219-ii (2014-15), chapter 10 (11
June 2014); also see: (35897), 7941/14 and (35898), 7942/14: Fiftieth
Report HC 83-xlv (2013-14), chapter 1 (14 May 2014), Forty-sixth
Report HC 83-xli (2013-14), chapter 7 (9 April 2014) and Forty-seventh
Report HC 83-xlii (2013-14), chapter 9 (30 April 2014); (35894),
7943/14 and (35895), 7944/14: Fiftieth Report HC 83-xlv (2013-14),
chapter 1 (14 May 2014), Forty-sixth Report HC 83-xli (2013-14),
chapter 6 (9 April 2014) and Forty-seventh Report HC 83-xlii (2013-14),
chapter 9 (30 April 2014).
Annex: Extract from European
Committee B debate on 9 June 2014
The Chair: I will now
move to Jacob Rees-Mogg, who will keep his two questions brief
and to the point.
Jacob Rees-Mogg (North
East Somerset) (Con): It is a pleasure to serve under your chairmanship,
Mrs Brooke.
What is the legal basis for the United Kingdom's
agreeing to the parts that are provisionally applied but are not
European Union competences?
Mr Lidington: We think
that the joint declaration protects our position because the language
makes it possible to say that there is ambiguity about what the
article might mean. The joint declaration means that it is not
only the United Kingdom saying this; the institutions of the European
Union themselves are saying that they agree with our interpretation
that the articles refer to those powers for which, under the European
treaties, it is the EU that has the right to act, rather than
competence lying with member states. The issue about the opt-in
is slightly different. That relates, as I said earlier, to a difference
between the European Scrutiny Committee and the Government in
the interpretation of the treaties.
Jacob Rees-Mogg: I am
grateful to my right hon. Friend, and I will come back to the
opt-in issue in a later set of questions, if I may, but I want
to concentrate specifically on the competence issue. If the European
Union does not have competence in certain areas, and it says it
does not have competence, what is the legal basis for making an
agreement provisionally with a third country? How can such a treaty
be enforceable or enacted if there is no legal basis for that
competence to be exercised? This nation has not exercised it,
because we have not gone through our own constitutional processes.
Mr Lidington: Those articles
of the association agreements address in broad terms a number
of issues that, when it comes to the outworking of the detail,
sometimes fall to the European Union and sometimes fall to member
state action. We could have said that we were going to block the
agreements entirely and that we would go through not just every
existing interpretation, but every hypothetical, future interpretation
of the articles to state in detail which would fall to member
states and which would fall to the European Union. I honestly
do not think that would have been a sensible way to proceed. By
definition, of course, we would not have been able to predict
how, in the future, new proposals might come forward. The point
of principle we have established is that the existing understanding
of where the competence boundary lies is being acknowledged publicly
and respected by all sides. That seems to be the most sensible
way to address this.
Jacob Rees-Mogg: Is it
the case that the competence of the nation states is being delegated
to the European Union for the purpose of the provisional application?
Mr Lidington: No. The
joint declaration ensures that the actions that are undertaken
through provisional implementation touch only on those things
that are properly within the competence of the European Union.
Jacob Rees-Mogg: But on
the issues that are the competence of the nation states that are
also subject to provisional application, by what legal mechanism
are they being agreed?
Mr Lidington: The provisional
application can apply legally only to those things that are within
the competence of the EU, not to those things that are within
the competence of the member states.
Jacob Rees-Mogg: If that
is the case, why do the Government need a declaration that certain
parts of the provisional application are still the competence
of the nation states if the only things that can be agreed are
those that are the competence of the European Union?
Mr Lidington: In part
to provide the reassurance, which my hon. Friend and others would
expect, that we have the language that shows that the institutions
themselves accept our interpretation of what the words of the
agreements actually mean.
Mr Thomas:
I want to explore a little
further the point of substance that the hon. Member for North
East Somerset was trying to explore. The Minister alluded in his
opening remarks to some disappointment that he was not able to
get a title V legal basis. Will he explain to the Committee why
that was not possible?
Mr Lidington: We
have a pretty long-standing argument with some elements of the
Commission about this matter. While our approach varies from one
measure to another, the Commission tends to take the view that
there is a need to cite a treaty basis or bases only in respect
of the principal areas covered by a particular EU measure. In
the case of these two agreements, the justice and home affairs
content is very small. In those areas that are subject to provisional
application, we are really only talking about mode 4 and the readmission
agreement.
I should be cautious about trying
to put words in the mouth of the Commission, but the approach
it would take is that the treaty bases we cite cover the main
objectives of the association agreement, so there is no need for
a title V basis to be specifically cited. We have had that argument
with it about a number of measures.
There is an extra element that
applies in terms of the readmission agreement. The Commission
argues that there is a JHA element there, but that the JHA obligation
lies not in the association agreement, but in the underlying self-standing
readmission agreement itself between the EU and Moldova, to which
we are already a party—we have already decided to opt in
to that. The Commission therefore goes on to argue that all that
the provision in the association agreement does is to reaffirm
a binding political commitment to that underlying previous readmission
agreement between the EU and Moldova. It is a fairly complicated
legal argument.
We take a different view. Not just
in respect of the Moldova and Georgia agreements, but generally,
we say that any JHA content, wherever it is found, should be supported
by the explicit citation of a title V legal basis.
Jacob Rees-Mogg: The Minister's
letter of 2 June states:
'The joint declaration we secured clearly sets
out that the exercise of competence by the EU, in respect of these
provisions and in the specific cases in Moldova and Georgia, does
not represent a precedent.'
There would be no point in saying that it did not
represent a precedent if the competence being exercised was one
that the European Union has anyway. The only reason for saying
that is because the EU is exercising a competence that belongs
to the nation states. I come back to my point: on what legal basis
is the competence of the nation states being delegated to the
European Union?
Mr Lidington: The particular
reason why we needed to deal with Georgia and Moldova is that
the protracted conflicts in those countries mean that member states
need to authorise the EU, as happens normally under the treaties,
to talk about things such as political co-operation for the resolution
of those conflicts, but without prejudice to the underlying delineation
of competence. The question is how the areas of shared competence
are exercised. As my hon. Friend knows, in a case of shared competence,
an area of policy making can be described in the treaties where
action can be taken either by the member states or by the European
Union. In the case of common foreign and security policy, because
of the requirement for unanimity, the common EU position exists
only if every member state has signed up to it. We wanted to make
quite sure that we could assure the Committee and Parliament that
agreeing to that work on political co-operation under the aegis
of the association agreement did not set a precedent for the accretion
of new competencies to the European Union that did not previously
exist.
Jacob Rees-Mogg: I am
extremely grateful for that answer. Does it therefore follow that
on this occasion the British Government are using the unanimity
achieved for a common foreign policy to agree to a treaty, and
does that require any domestic legal approval?
Mr Lidington: We
are not operating on the basis of any new powers. We and previous
Governments have agreed to association agreements before. The
two agreements will be laid before Parliament, and affirmative
resolutions will be required in each House for Parliament to approve
the ratification by the United Kingdom of the two treaties. That
is the further check that Parliament has on the matter.
36 See the extract at the annex to this chapter of
our Report. Back
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