RECOMMENDATION on the draft Council decision on the conclusion, on behalf of the European Union, of the Protocol Amending the Marrakesh Agreement Establishing the World Trade Organization

22.7.2015 - (06040/2015 – C8‑0077/2015 – 2015/0029(NLE)) - ***

Committee on International Trade
Rapporteur: Pablo Zalba Bidegain

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the draft Council decision on the conclusion, on behalf of the European Union, of the Protocol Amending the Marrakesh Agreement Establishing the World Trade Organization

(06040/2015 – C8‑0077/2015 – 2015/0029(NLE))

(Consent)

The European Parliament,

–       having regard to the draft Council decision (06040/2015),

–       having regard to the draft Protocol Amending the Marrakesh Agreement Establishing the World Trade Organization (06041/2015),

–       having regard to the request for consent submitted by the Council in accordance with Article 207(4) and Article 218(6), second subparagraph, point (a) (v), of the Treaty on the Functioning of the European Union (C8‑0077/2015),

–       having regard to its non-legislative resolution of ....[1] on the draft decision on the conclusion, on behalf of the European Union, of the Protocol Amending the Marrakesh Agreement Establishing the World Trade Organization,

–       having regard to Rule 99(1), first and third subparagraphs, Rule 99(2), and Rule 108(7) of its Rules of Procedure,

–       having regard to the recommendation of the Committee on International Trade and the opinion of the Committee on Development (A8-0237/2015),

1.      Gives its consent 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 to the World Trade Organization.

SHORT JUSTIFICATION

The trade facilitation agreement (TFA) which was concluded at the 9th WTO Ministerial Conference in December 2013 is the first multilateral agreement since the WTO was established in 1995. The issue first appeared on the WTO agenda during the Ministerial in Singapore in 1996 and subsequently found its way into the Doha Declaration where WTO members committed to concluding a deal on this issue.

The TFA stands as an innovative agreement not only for being the first multilateral agreement on new rules to have been negotiated under the auspices of the WTO since it was created almost 20 years ago. It sets a pioneering approach by:

-       Allowing developing and least developed countries to categorize commitments and determine the timing of their implementation.

-       Linking implementation of some disciplines to the provision of technical assistance.

-       Calling for joint action by donor countries, development assistance providers and developing and least developed country WTO members to assist the latter in implementing some provisions of the agreement.

-       Incorporating an Expert Group to assess the situation in a Member once notified implementation periods have expired, and the use of the TFA Committee as a forum for the exchange of experiences and deliberation.

The Agreement pursues a "positive integration" through specific practices and - instead of refraining from using certain policies - contains approximately 40 provisions for expediting the movement, release and clearance of goods, including provisions for the publication of laws, regulations and procedures, use of electronic payment, reduced formalities and documentation requirements or uniformity in application of border procedures.

It will require increased transparency and greater cooperation between customs authorities. Provisions on goods in transit are of particular interest to landlocked countries that seek to trade through ports in neighbouring countries.

It should also be noted that in the TFA there is less emphasis on “hard law” and more of a focus on cooperation aimed at achieving a set of good practices that governments can support and comply with.

Special and Differential Treatment

The TFA addresses the disparities between WTO members' capacity to implement the provisions by allowing each developing and LDC Member to self-determine when to implement, under a phased schedule, each of the technical measures foreseen. There are three different categories of provisions, namely:

-       Category A: provisions that the member will implement by the time the Agreement enters into force (or in the case of a least-developed country member within one year after entry into force)

-       Category B: provisions that the member will implement after a transitional period following the entry into force of the Agreement

-       Category C: provisions that the member will implement on a date after a transitional period following the entry into force of the Agreement and requiring the acquisition of assistance and support for capacity building.

For provisions designated as categories B and C, the member must provide dates for implementation of the provisions, as outlined in the following factsheets:

Technical and financial assistance

A key aspect of the Trade Facilitation Agreement is the provision of technical assistance by donor countries to developing and least developed countries through an assistance mechanism. The World Bank has a facility for middle income countries and can disburse up to €30 million per year, one third of which comes from the EU. The EU has pledged more than €400 million in assistance to be disbursed over a period of five years. Moreover the World Bank and UNCTAD have also earmarked funds for this purpose and Member States are also making money available.

A key issue will be ensuring that the various funds are well coordinated. The money will be recipient driven and it will be up to developing countries and LDCs to identify this particular priorities. On the expertise side, the World Customs Organisation can provide capacity building and expertise to countries in need.

Conclusions

The agreement demonstrates the ability to be innovative in recognizing differences in implementation capacity across nations by calling on developing and least developed countries to determine when they will apply specific provisions of the agreement and by linking implementation of some disciplines to the delivery of assistance from developed nations.

In order for the TFA to enter into force, it needs to be ratified by two thirds of the 160 WTO members who agreed it at the 9th Ministerial Conference.

25.6.2015

OPINION of the Committee on Development

for the Committee on International Trade

on the draft Council decision on the conclusion, on behalf of the European Union, of the Protocol Amending the Marrakesh Agreement Establishing the World Trade Organization

(06040/2015 – C8‑0077/2015 – 2015/0029(NLE))

Rapporteur: Doru-Claudian Frunzulică

SHORT JUSTIFICATION

After almost a decade, the negotiations for the Trade Facilitation Agreement (TFA) were finally concluded at the World Trade Organization's 9th Ministerial Conference in December 2013. The Agreement is, so far, the main outcome of the Doha Development Round launched in 2001 and will be, for many developing countries, the main source of gains in the Round.

The TFA could be labelled historic for at least two reasons. It is the first new Agreement since the WTO's creation in 1995 and, moreover, makes a step forward in the multilateral trading system's responsiveness to developing countries' concerns. In fact, the implementation of the new commitments, notably by the developing and least developed country Members, was an up-front consideration, and the foreseen implementation flexibilities are unprecedented at WTO level.

Geared essentially at streamlining and modernising customs procedures and rules, the Agreement contains approximately 40 provisions aimed at expediting the cross-border movement of goods, to ensure that trade flows as seamlessly and predictably as possible. It will require increased transparency and greater cooperation between customs authorities. Provisions on goods in transit are of particular interest to landlocked countries that seek to trade through ports in neighbouring countries.

Once implemented, the Agreement should increase trade flows, expand duty collection revenue as a result of higher trade volume and better detection of fraud, and improve the efficiency of customs administrations. Transparency and automation measures will help to deal with border corruption. The OECD has estimated that implementing all the measures foreseen in the TFA would reduce total trade costs by 13-15.5% in developing countries, the potential benefits by far outweighing the mostly limited costs.

Along with making it easier, faster and cheaper to trade, removing administrative hurdles should also help developing countries and their businesses, including SMEs, to better integrate in regional and global value chains, and thus to reap greater benefits from international trade.

Special and Differential Treatment

In terms of implementation, the Agreement contains far-reaching provisions on special and differential treatment for developing countries and LDCs. By linking the implementation of the technical measures with the capacity to do so, it introduces a novel and unique approach of tailoring of commitments, which should serve as a benchmark for future agreements. Instead of merely granting transition periods, the TFA allows each developing and LDC Member to self-determine when to implement, under a phased schedule, each of the technical measures foreseen. Additional flexibilities allow for extended implementation delays, should countries face difficulties in keeping to their schedules.

A significant number of developing countries have already notified their Category A commitments ˗ that is, measures to be implemented upon entry into force of the TFA ˗ and the first two notifications by LDCs have been received. Also, there are welcome indications that major emerging economies would not seek transitional periods or financial support for implementation.

Overall, and apart from automation (e-customs, single window), the majority of the most-facilitating measures are rather straightforward and inexpensive ˗ in most countries they should not require significant amounts of assistance and should be possible to implement either immediately or following modest transitional periods. Again, benefits will depend on implementation. The countries that recognize the gains and seize the opportunity and funding to modernize their structures will reap the full benefits.

Technical and financial assistance

Along with the implementation flexibilities, the TFA seeks to ensure that technical assistance and financial support will be provided to help developing and least developed WTO Members to build up their capacity to implement the reforms.

The EU, a leading provider of support for trade facilitation, has pledged to cover a significant share of developing countries' funding needs to implement the Agreement, and to maintain at least €400 million over five years as part of its trade-related assistance (Aid for Trade). Along with its regional and national programming, the EU will continue to support trade facilitation reforms, notably through the WTO, the World Bank and UNCTAD.

Given the involvement of a number of international financial institutions and organisations, and the important pledges to support the implementation of the TFA, coordination of aid will be key to avoid the risk of funding becoming too dispersed to manage, along with the necessary monitoring of and reporting on aid flows.

Conclusions

While the new Agreement is expected to significantly reduce the time and cost of trading, and thus help businesses in developing and least-developed countries to access new export opportunities, your rapporteur recognises that it will benefit, in the first instance, those countries that trade and swiftly implement the commitments. Eventually, the modernisation efforts should bear fruit in all countries.

In the light of the above considerations, your rapporteur recommends to consent to the conclusion of the Agreement.

******

The Committee on Development calls on the Committee on International Trade, as the committee responsible, to recommend that Parliament give its consent to the draft Council decision on the conclusion, on behalf of the European Union, of the Protocol Amending the Marrakesh Agreement Establishing the World Trade Organization.

RESULT OF FINAL VOTE IN COMMITTEE

Date adopted	23.6.2015
Result of final vote	+: –: 0:	15 4 2
Members present for the final vote	Louis Aliot, Beatriz Becerra Basterrechea, Ignazio Corrao, Doru-Claudian Frunzulică, Nathan Gill, Charles Goerens, Heidi Hautala, Maria Heubuch, Teresa Jiménez-Becerril Barrio, Stelios Kouloglou, Linda McAvan, Norbert Neuser, Maurice Ponga, Lola Sánchez Caldentey, Elly Schlein, György Schöpflin, Pedro Silva Pereira, Davor Ivo Stier, Paavo Väyrynen, Bogdan Brunon Wenta
Substitutes present for the final vote	Paul Rübig

RESULT OF FINAL VOTE IN COMMITTEE

Date adopted	14.7.2015
Result of final vote	+: –: 0:	33 4 2
Members present for the final vote	Maria Arena, Tiziana Beghin, David Borrelli, David Campbell Bannerman, Daniel Caspary, Marielle de Sarnez, Santiago Fisas Ayxelà, Eleonora Forenza, Yannick Jadot, Jude Kirton-Darling, Bernd Lange, David Martin, Emma McClarkin, Sorin Moisă, Alessia Maria Mosca, Artis Pabriks, Inmaculada Rodríguez-Piñero Fernández, Marietje Schaake, Helmut Scholz, Joachim Schuster, Joachim Starbatty, Hannu Takkula, Iuliu Winkler, Jan Zahradil
Substitutes present for the final vote	Bendt Bendtsen, Reimer Böge, Klaus Buchner, Nicola Danti, Edouard Ferrand, Gabriel Mato, Frédérique Ries, Fernando Ruas, Lola Sánchez Caldentey, Marita Ulvskog, Jarosław Wałęsa, Pablo Zalba Bidegain
Substitutes under Rule 200(2) present for the final vote	Lars Adaktusson, Laura Agea, Elisabetta Gardini

• [1]               Texts adopted of that date, P8_TA(2015)0000.