RECOMMENDATION on the draft Council decision on the conclusion of an Agreement in the form of a Protocol between the European Union and the Arab Republic of Egypt establishing a dispute settlement mechanism applicable to disputes under the trade provisions of the Euro-Mediterranean Agreement establishing an Association between the European Communities and their Member States, of the one part, and the Arab Republic of Egypt, of the other part

18.3.2011 - (13762/2010 – C7‑0372/2010 – 2010/0229(NLE)) - ***

Committee on International Trade
Rapporteur: Gianluca Susta

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the draft Council decision on the conclusion of an Agreement in the form of a Protocol between the European Union and the Arab Republic of Egypt establishing a dispute settlement mechanism applicable to disputes under the trade provisions of the Euro-Mediterranean Agreement establishing an Association between the European Communities and their Member States, of the one part, and the Arab Republic of Egypt, of the other part

(13762/2010 – C7‑0372/2010 – 2010/0229(NLE))

(Consent)

The European Parliament,

–   having regard to the draft Council decision (13762/2010),

–   having regard to the draft Agreement in the form of a Protocol between the European Union and the Arab Republic of Egypt establishing a dispute settlement mechanism applicable to disputes under the trade provisions of the Euro-Mediterranean Agreement establishing an Association between the European Communities and their Member States, of the one part, and the Arab Republic of Egypt, of the other part (13975/2010),

–   having regard to the request for consent submitted by the Council in accordance with Article 207(4), first subparagraph and Article 218(6), second subparagraph, point (a)(v), of the Treaty on the Functioning of the European Union (C7‑0372/2010),

–   having regard to Rules 81 and 90(8) of its Rules of Procedure,

–   having regard to the recommendation of the Committee on International Trade (A7‑0068/2011),

1.  Consents to conclusion of the Agreement;

2.  Instructs its President to forward its position to the Council, the Commission and the governments and parliaments of the Member States and of the Arab Republic of Egypt.

EXPLANATORY STATEMENT

To date, disputes arising from the Euro-Mediterranean Agreements relied solely on diplomatic approaches for a resolution. In practice, this is not efficient and has led to situations were disputes remained unresolved, as they could easily be blocked by the "injuring" party.

The Council authorised the Commission to open negotiations with its partners from the Mediterranean in 2006 with a view to negotiate a proper Dispute Settlement Mechanism. A draft agreement was initialled with Egypt at the EU-Egypt Association Council held in Luxembourg on 27 April 2010.

The creation of a standard dispute settlement mechanism is welcomed, as it should provide streamlined and effective redress procedures within firm time limits. The Rapporteur believes that these upgrades to the Euromed Free Trade Agreements can contribute towards economic and political stability in this key region with a view to consolidating a single shore of peace, development, justice, equality, freedom, plurality, democracy and respect.

Furthermore, the proper application of such a mechanism could increase the security and the predictability of our bilateral trade relations and could represent a further step towards the setting up and the proper functioning of the Euromed Free Trade Area.

The proposed mechanism is modelled on the dispute settlement mechanisms of the most recent agreements concluded by the European Union and on the WTO Dispute Settlement Understanding. The Rapporteur agrees that bilateral trade agreements should always be fully compatible with the multilateral trading system. Moreover, the Commission needs to ensure is that the implementation is effective and will, de facto, be used.

In the light of the above, the Rapporteur proposes that Parliament gives its consent to this agreement. Lingering disputes have a negative effect on the business community and also on end-consumers on both shores of the Mediterranean. With the entry into force of the Lisbon Treaty, Foreign Direct Investment became part of the EU Trade Policy, and thus part of the Union's exclusive competence. In an era where Foreign Direct Investment plays an important role in the economic welfare of countries and regions, the Rapporteur hopes that a well functionning and effective dispute settlement mechanism will also serve to solve disputes also in this area.

RESULT OF FINAL VOTE IN COMMITTEE

Date adopted	16.3.2011
Result of final vote	+: –: 0:	24 0 2
Members present for the final vote	William (The Earl of) Dartmouth, Laima Liucija Andrikienė, Kader Arif, David Campbell Bannerman, Christofer Fjellner, Metin Kazak, Bernd Lange, David Martin, Emilio Menéndez del Valle, Vital Moreira, Cristiana Muscardini, Godelieve Quisthoudt-Rowohl, Niccolò Rinaldi, Tokia Saïfi, Helmut Scholz, Peter Šťastný, Robert Sturdy, Gianluca Susta, Keith Taylor, Iuliu Winkler, Pablo Zalba Bidegain, Paweł Zalewski
Substitute(s) present for the final vote	Catherine Bearder, George Sabin Cutaş, Syed Kamall, Miloslav Ransdorf, Jarosław Leszek Wałęsa