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Scrutiny of international agreements: treaties considered on 4 February 2020 Contents

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Chapter 2: Agreement reported for information

Agreement establishing an Association between the United Kingdom of Great Britain and Northern Ireland and the Hashemite Kingdom of Jordan (CP204, 2019)18

22.The UK-Jordan Association Agreement was laid on 20 December 2019, and the scrutiny period is scheduled to end on 11 February 2020. It was considered by the EU External Affairs Committee at its meeting on 30 January.

23.The precursor agreement to the UK-Jordan Agreement is the EU-Jordan Agreement,19 which entered into force in 2002. It incorporates a trade agreement and outlines a framework for political, economic, social and cultural cooperation. The UK-Jordan Agreement seeks to ensure continuity of effect with the EU Agreement by incorporating it mutatis mutandis20 with only a small number of modifications. Consequently, the UK Agreement has been published in short form. The UK-Jordan Agreement also incorporates the EU-Jordan Dispute Settlement Mechanism Protocol.21

24.For the Agreement to enter into force, it must be ratified by both the UK and Jordan. The Agreement will come into force on the first day of the second month following the date of the later of the notifications from either Party confirming the completion of the ratification procedure, provided this is after the EU-Jordan Agreements cease to apply to the UK. There is no provisional application clause, as the Jordanian Constitution does not allow for provisional application.

25.Trade with Jordan accounts for less than 0.1% of UK trade. In 2018, total trade in goods and services was £448 million. Main UK goods exports include those in the ‘machinery and mechanical appliances’ and ‘vehicles other than railway or tramway stock’ categories of the Harmonised System Main UK goods imports from Jordan include goods in the ‘edible vegetables’, ‘aircraft, spacecraft and parts thereof’ and ‘edible fruit or nuts’, categories.

26.The Agreement—like other trade agreements previously considered by the Committee—introduces an extended cumulation of origin. This allows both parties to recognise content from the EU as originating in the UK or Jordan in exports to one another. The Government notes that, without these provisions, products from the UK or Jordan incorporating EU materials would no longer meet the origin requirements for preferential treatment by the other party.22 EU processing can also be recognised in UK exports to Jordan (though not vice versa).23

27.Wider cumulation provisions also apply to both parties. Subject to free trade agreements between the UK, Jordan and the following countries, products and materials originating in the EFTA states (Switzerland, Norway, Iceland and Liechtenstein), Turkey and other parties to the PEM Convention24 can also be counted as originating in the UK or Jordan, subject to minimum working or processing requirements. For the UK (though not for Jordan), wider cumulation provisions also apply to ‘working and processing’, as working and processing carried out in Iceland or Norway can also count as having been conducted in the UK.

28.While tariff levels in the UK Agreement will remain the same as in the precursor EU Agreement, tariff rate quotas (TRQs) have been resized to reflect trade flows between the UK and Jordan. The UK Government based the resized TRQs on historic trade flow data. To maintain market access, both sides agreed to provide a minimum level of access by basing TRQs on a proxy measure where data showed historic trade as being very low or non-existent.

29.The UK-Jordan Agreement, like its predecessor EU Agreement, does not include substantive commitments on the protection of geographical indicators (GIs). The Agreement instead builds on intellectual property commitments under TRIPS.25

30.The EU-Jordan Agreement contains an Entry Price System (EPS), which applies to 15 types of fruit and vegetables. It ensures that during the European growing seasons an additional duty is charged if incoming fruits and vegetables are below a pre-determined entry price. The UK-Jordan Agreement does not automatically re-establish such an EPS, but the UK reserves the right to establish and implement one in the future.

31.The institutional and governance provisions of the Agreement allow for significant amendments. Under Article 10 of the UK-Jordan Agreement, the Parties may mutually agree to amend the text of the Agreement, subject to each party’s “internal legal procedures”. According to the Parliamentary Report, in the UK “amendments to the Agreement that are expressly subject to a formal exchange of notes to confirm completion of internal procedures would engage the process of Parliamentary scrutiny set out in the CRaG Act”.26 The concerns expressed in paragraph 12 above apply.

32.The Association Council and Association Committee—the main governance bodies established under the Agreement—may also make modifications in specified technical areas.27 These amendments would be unlikely to engage the parliamentary scrutiny process under the CRAG Act. To avoid a scrutiny gap, we recommend that when the Government reports on changes to international agreements, it should include changes made by bodies such as the Association Council or the Association Committee of the UK-Jordan Agreement.

33.We welcome the fact that the Government has provided detailed information on the geographical extent of agreements, clarifying which elements would apply to Gibraltar and to the Crown Dependencies. We also welcome the Minister’s explicit confirmation in the EM that “HMG has shared the stable text of the Agreement with the DAs, the Crown Dependencies and Gibraltar”.

34.We report the UK-Jordan Association Agreement to the House for information.

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