EU-SINGAPORE FREE TRADE AGREEMENT

In “A Stronger Europe in the World”

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For a brief overview of the key points of the adopted text and its significance for the citizen, please see the corresponding summary note.

Background and state of play

Negotiations for an EU-Singapore free trade agreement (EUSFTA) were launched in 2010, on the basis of the ASEAN negotiating directives of 2007. The negotiating directives were modified in July 2011, to authorise the Commission to open negotiations on investment protection provisions within the free trade agreement with Singapore. Following the conclusion of talks on investment protection, negotiations were completed in October 2014, with other parts of the EUSFTA having already been initialled in September 2013.

As the negotiations had ended prior to the decision on the EU's updated approach on investment protection, the Commission started to explore with Singapore how to adapt the investment protection provisions in the draft agreement to this new approach. In addition, in 2015 the Commission sought an opinion from the Court of Justice of the EU (CJEU). The Court was asked which provisions of the EUSFTA fall within the EU's exclusive or shared competences, and which remain within the exclusive competence of the Member States. On 16 May 2017, the CJEU issued its opinion, stating that the EUSFTA, in its 2014 form, also covered shared competences.

Effort was made to take into account both the EU's new investment approach and the CJEU opinion. Further to this, the negotiations between the Commission and Singapore have led to the splitting of the EUSFTA. On 18 April 2018, the Commission proposed to the Council the signature and conclusion of the free trade and investment protection agreements with Singapore. The Council adopted the decision to sign the agreements on 15 October 2018. The agreements were signed during the Asia-Europe Meeting (ASEM) Summit in Brussels, on 19 October 2018.

Content of the FTA

The EU-Singapore Free Trade Agreement deals with trade and foreign direct investment (FDI) liberalisation. It is a 'new generation' trade agreement, with an ambitious, comprehensive scope. It covers areas such as tariff liberalisation; reduction of non-tariff trade barriers; and promotion of services and investment. Other trade-related issues include, for example, stronger protection for certain EU geographical indications (GIs), based on a register of GIs. The agreement will also provide EU companies with improved access to government procurement opportunities. This trade agreement, as it was separated from the investment protection agreement, includes only provisions under the exclusive competence of the EU and could be concluded by the EU on its own.

Status of the procedure to adopt the agreement

Following the adoption of the decision to sign the FTA, the Council has sent the agreement to the European Parliament for its approval ('consent'). In the Parliament, the Council's request for consent has been referred to the Committee on International Trade (INTA), the responsible committee.

On 16 October 2018, the Committee's draft recommendation on the conclusion of the agreement and, on 11 October 2018, the accompanying draft report was issued. In the draft recommendation, the rapporteur (David Martin, S&D) recommended that the Parliament give its consent to the conclusion of the agreement. On 24 January 2019, members of the INTA Committee adopted the recommendation to approve the agreement, together with the accompanying report on the FTA.

On 13 February 2019, the European Parliament gave its consent to the conclusion of the EU-Singapore Free Trade Agreement by 425 votes to 186, with 41 abstentions. It also adopted an accompanying resolution, in which it lays out its expectations for the implementation of the agreement and the reasons for its decision to approve the deal, with 431 votes in favour, 189 against and 52 abstentions.

On 8 November 2019, the Council adopted the decision to conclude the agreement. Following the conclusion of the final formalities of each party, the agreement is to enter into force on 21 November 2019.

Position of the European Parliament

The European Parliament resolution of 5 July 2016 on a new forward-looking and innovative future strategy for trade and investment stressed the need for successfully concluded trade agreements to be ratified as swiftly as possible; more specifically, it called for the conclusion of the deal with Singapore. In its resolution of 13 February 2019, the EP underlined the economic and strategic importance of the FTA. The Parliament highlighted, among other things, the elimination of the few remaining tariffs on EU products, the removal of certain non-tariff trade barriers, the facilitation for EU companies to access the services market and public procurement market in Singapore, and the recognition of the right of Member States at all levels to define and provide public services. It also welcomed the parties' commitment to providing high levels of environmental and labour protection. However, the EP deplored the fact that the protection of the EU GIs included in the agreement is not automatic, as this protection must be obtained through a registration procedure in Singapore. The EP requested that the development of the registration procedure should be started immediately, and that the registry should be established expeditiously. Moreover, it called on the Commission to ensure protection for the highest number of EU GIs. The Parliament also stressed that Singapore should work towards ratifying the three outstanding ILO core conventions, and that the participation of the civil society and social partners in the monitoring of the FTA's implementation is of key importance.

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Author: Krisztina Binder, Members' Research Service, legislative-train@europarl.europa.eu

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As of 20/11/2019.