Scrutiny of international agreements; treaties considered on 5 February 2019 Contents

Chapter 2: Treaties considered on 5 February 2019

EU competence in respect of trade agreements

18.All three of the international agreements considered in this report are Protocols to earlier multilateral or plurilateral agreements.8 In each case, the United Kingdom is already party to the original agreement, but party to the Protocol only by virtue of its EU membership. This apparent anomaly is explained in Box 1.

Box 1: The EU and the World Trade Organization

Even though the UK is a Member of the World Trade Organization and also a signatory to the (plurilateral) Agreement on Trade in Civil Aircraft in its own right, it is currently bound by the three Protocols considered in this report only as a Member State of the European Union. The reason for this apparent discrepancy lies in the fact that both the content of international trade agreements and the scope of EU competences have evolved over time.

The EU has long held an exclusive competence with regard to the common commercial policy. Early trade agreements were, however, limited in scope, and when the WTO Agreements were negotiated in the early 1990s, the Commission and Member States disagreed about the extent to which the EU had the competence to conclude the new agreements. The Court of Justice was asked to issue an opinion on this question, and decided that the European Union (at that time still the Community) and its Member States were “jointly competent”, both with regard to the General Agreement on Trade in Services (GATS) and the TRIPS Agreement.9

In response to the enlarged scope of international trade negotiations, Member States decided over time also to enlarge the EU’s competences in this area. The three Protocols at issue here fell into these enlarged exclusive competences of the EU. Thus the EU accepted them and they became binding on the Member States without the Member States having to become parties in their own right.

Agreements reported for information

Protocol (2015) amending the Annex to the Agreement on Trade in Civil Aircraft (CP 9, 2019)10

19.The Protocol was laid on 11 January 2019, and the scrutiny period is scheduled to end on 18 February. It was considered by the EU Internal Market Sub-Committee at its meeting on 31 January.

20.The UK is an independent signatory to the plurilateral Agreement on Trade in Civil Aircraft (ATCA), which eliminates import duties on aircraft (other than military aircraft) as well as other products such as civil aircraft engines, parts, components of civil aircraft and flight simulators. An Annex to the ATCA lists the products to be accorded duty-free or duty-exempt treatment. Products in the Annex are classified following the Harmonized Commodity Description and Coding System (‘the Harmonized System’), which allows participating countries to classify traded goods on a common basis.

21.A Protocol to the ATCA, which was opened for acceptance on 5 November 2015, amends the Annex to make the product list compatible with a 2007 revision to the Harmonized System. The UK did not accept the Protocol to the Agreement in its own right, but the Council of the European Union, acting on behalf of the Member States, authorised acceptance of the Protocol in March 2017.11 The Government’s Explanatory Memorandum (EM) notes that the effects of the Protocol “are bound in our WTO goods schedule”. The Government proposes to lodge an instrument of continued acceptance at the WTO to ensure the UK’s ongoing adherence after leaving the EU.

22.We report the Protocol amending the Annex to the Agreement on Trade in Civil Aircraft for information.

Protocol amending the TRIPS Agreement (CP 10, 2019)12

23.The Protocol was laid on 11 January 2019, and the scrutiny period is scheduled to end on 18 February. It was considered by the EU Justice Sub-Committee at its meeting on 22 January.

24.The Agreement on Trade-Related Aspects of Intellectual Property Rights (the TRIPS Agreement), which came into effect on 1 January 1995, is a comprehensive multilateral agreement on intellectual property between all the members of the World Trade Organization (WTO). It sets down minimum standards for the regulation by national governments of many forms of intellectual property.

25.The European Union accepted the Protocol Amending the TRIPS Agreement on 30 November 2007 on behalf of the Member States, on the basis that it fell within an area of exclusive EU competence.13 The TRIPS Amendment, which entered into force on 23 January 2017 (following its acceptance by two thirds of WTO members), is aimed at improving access to affordable medicines in developing countries. The UK is currently bound by the Amendment, and now proposes to lodge an instrument of continued acceptance at the WTO to confirm its membership after leaving the EU.

26.We report the Protocol amending the TRIPS Agreement for information.

Protocol amending the Marrakesh Agreement establishing the World Trade Organization (CP 11, 2019)14

27.The Protocol was laid on 11 January 2019, and the scrutiny period is scheduled to end on 18 February. It was considered by the EU External Affairs Sub-Committee at its meeting on 31 January.

28.In July 2004 the General Council of the World Trade Organization (WTO) resolved to improve aspects of the 1994 General Agreement on Tariffs and Trade, to help reduce the administrative burden associated with moving goods across borders. The outcome of the negotiations that followed was the Agreement on Trade Facilitation, incorporated by the Protocol Amending the Marrakesh Agreement establishing the World Trade Organization. As it fell into an area of exclusive EU competence, it was not ratified by the UK, but by the European Union on behalf of all Member States on 5 October 2015.15

29.The Agreement is divided into two sections. The first section is designed to expedite the movement of goods by streamlining customs procedures and removing red tape. The second section contains special and differential treatment provisions for developing and least-developed countries that allow them to either delay implementation of individual provisions, or make the implementation of specific provisions contingent on the receipt of technical assistance and capacity building support.

30.During the original negotiations, the UK Government produced a benefits estimate, which assumed a gain of about £1bn to the UK economy. It noted that, given the efficiency of UK customs procedures, the benefits to the UK were likely to be fewer than for other EU Member States, but that UK traders would benefit from faster clearance times for their goods in other countries.

31.In the Explanatory Memorandum accompanying the Protocol the Government states its strong support for the Trade Facilitation Agreement, noting that the UK is already fully compliant with its obligations.

32.Given the UK is simply seeking to accede to the existing Protocol, with all its benefits and no new obligations, we report the Protocol amending the Marrakesh Agreement establishing the World Trade Organization for information.


8 In the WTO, a plurilateral agreement is one which only involves some members, whereas a multilateral agreement involves all members.

9 Opinion 1/94, ECLI:EU:C:1994:384: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A61994CV0001 [accessed 30 January 2019]

10 Protocol (2015) amending the annex to the Agreement on trade in civil aircraft, CP 9, 2019: https://www.gov.uk/government/publications/ms-no22019-protocol-2015-amending-the-annex-to-the-agreement-on-trade-in-civil-aircraft [accessed 31 January 2019]

11 Council Decision (EU) 2017/446 of 3 March 2017 on the conclusion on behalf of the European Union of the Protocol (2015) amending the Annex to the Agreement on Trade in Civil Aircraft, OJ L 69 (15 March 2017), p 1, based on Art. 207(4) in conjunction with Art. 218(6)(a) of the TFEU

12 Protocol amending the TRIPS Agreement, CP 10, 11 January 2019: https://www.gov.uk/government/publications/ms-no32019-protocol-amending-the-trips-agreement [accessed 28 January 2019]

13 Correct at the time of writing: this date will be brought forward, if the previously announced House of Commons recess in February is cancelled.

13 Council Decision of 19 November 2007 on the acceptance, on behalf of the European Community, of the Protocol amending the TRIPS Agreement, done at Geneva on 6 December 2005 (2007/768/EC), OJ L 311 (29 November 2007), p 35, based on Art. 133(5) in conjunction with Art. 300(2), (3) of the TEC

14 Protocol amending the Marrakesh Agreement establishing the World Trade Organization, CP 11, 2019: https://www.gov.uk/government/publications/ms-no12019-protocol-amending-the-marrakesh-agreement-establishing-the-world-trade-organization [accessed 31 January 2019]

15 Council Decision (EU) 2015/1947 of 1 October 2015 on the conclusion, on behalf of the European Union, of the Protocol Amending the Marrakesh Agreement establishing the World Trade Organization, OJ L 284 (30 October 2015), p 1, based on Art. 207(4) in conjunction with Art. 218(6)(a) of the TFEU




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