The EU's Post‐Lisbon Free Trade Agreements: Commercial Interests in a Changing Constitutional Context

• Date: 01 November 2014
• DOI: http://doi.org/10.1111/eulj.12102
• Author: Dominik Hanf,Sieglinde Gstöhl
• Published date: 01 November 2014

The EU’s Post-Lisbon Free Trade

Agreements: Commercial Interests in a

Changing Constitutional Context

Sieglinde Gstöhl* and Dominik Hanf**

Abstract: This article examines how the Common Commercial Policy in the post-Lisbon

era impacts citizens’ rights both within the EU and in the partner countries. The EU’s

aspiration to pursue a normative agenda through trade has further been reinforced by the

Lisbon Treaty, both with regard to the objectives of external action and the reformed

trade policy-making processes. Concurrently, however, the EU has refocused its trade

strategy on growth and competitiveness, and strongly advocated the conclusion of ‘new

generation’ free trade agreements. These agreements combine an ambitious ‘WTO-plus’

agenda with normative issues such as provisions on human rights, a social dimension

and sustainable development. The result of this dual approach is a mixed ‘constitutional

balance’: whereas constitutional rights and competitiveness have the potential to

reinforce each other with positive synergy effects, they may also result in tensions and

policy incoherencies.

I Introduction: Competitiveness v. Constitutional Rights?

The EU is a champion of preferential trade agreements. There are currently merely

eight members of the World Trade Organization (WTO) that trade with the EU on

the basis of most-favoured nation treatment.1This number will further dwindle when

the new free trade agreements (FTAs) with Canada and Singapore will enter into

force, and if the bilateral negotiations that have in 2013 been launched with Japan and

the United States succeed. In the context of the renewed Lisbon Strategy for growth

and jobs2and the failings of the WTO Doha Round, the European Commission’s

trade strategy has been refocused on the EU’s core commercial interests. The 2006

* Director of EU International Relations and Diplomacy Studies at the College of Europe in Bruges,

Belgium.

** Visiting Professor in European Legal Studies at the College of Europe and Administrator at the First

Board of Appeal of the Off‌ice of Harmonisation for the Internal Market (OHIM) in Alicante, Spain.

The views expressed in this article are strictly personal and should not be attributed to the OHIM. This

article was f‌inalised in June 2012 and updated in August 2013.

1Australia, Canada, Hong Kong, Japan, New Zealand, Singapore, Taiwan and the United States. The

developing and transition countries currently benef‌it from the EU’s unilateral Generalised System of

Preferences. Their number will, however, be reduced when the new system enters into force in 2014.

2European Commission, Communication to the European Spring Council, Working Together for Growth

and Jobs: A New Start for the Lisbon Strategy, COM(2005) 24, 2.2.2005.

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European Law Journal, Vol. 20, No. 6, November 2014, pp. 733–748.

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‘Global Europe’ trade strategy put an end to the ‘Lamy doctrine’ of 1999, a de facto

moratorium on new bilateral FTAs in favour of the multilateral trade round. The new

strategy aimed at reinforcing the EU’s competitiveness by opening up more, and in

particular emerging markets by means of FTAs: ‘The key economic criteria for new

FTA partners should be market potential (economic size and growth) and the level of

protection against EU export interests (tariffs and non tariff barriers)’ as well as the

partner’s negotiations with EU competitors.3This approach targeted in particular

countries and regional integration schemes such as South Korea, India, the Associa-

tion of Southeast Asian Nations, Mercosur, Russia, the Gulf Cooperation Council

and, as a special case, China.4

At the same time, the entry into force of the Treaty of Lisbon in 2009 has brought

about important changes for the Common Commercial Policy. On the one hand,

trade has explicitly been placed in the context of the EU’s broader objectives of

external action while, on the other hand, the competences and decision-making pro-

cesses have been revised, inter alia resulting in more powers for the European Parlia-

ment. These changes are likely to affect both the process of elaboration and the

content of the Union’s trade policy.

In reaction to the global economic and f‌inancial crisis that hit Europe in 2008, the

‘Europe 2020’ strategy for smart, sustainable and inclusive growth further called for a

trade strategy that emphasises the conclusion of ongoing trade negotiations and a

better enforcement of existing agreements, as well as new trade opening initiatives

for sectors of the future and proposals for high-level strategic dialogues with key

partners.5In its ensuing 2010 Communication ‘Trade, Growth and World Affairs’, the

Commission claims that ‘for an open trade policy in Europe to succeed politically,

others—including both our developed and emerging partners—must match our efforts,

in a spirit of reciprocity and mutual benef‌it’.6It also underlines that ‘the Union’s trade

and foreign policies can and should be mutually reinforcing’ and that specif‌ic trade

instruments such as FTAs should be used to encourage ‘partners to promote the respect

of human rights, labour standards, the environment, and good governance, including

in tax matters’.7Hence, the focus is on so-called ‘new generation’ FTAs, which

go beyond trade in (industrial) goods and cover also certain ‘Singapore issues’8or

3European Commission, Communication from the Commission to the Council, the European Parliament,

the European Social and Economic Committee and the Committee of the Regions, Global Europe:

Competing in the World: A Contribution to the EU’s Growth and Jobs Strategy, COM(2006) 567 f‌inal,

Brussels, 4.10.2006, 9.

4ibid.

5European Commission, Communication from the Commission, Europe 2020: A Strategy for Smart,

Sustainable and Inclusive Growth, COM(2010) 2020 f‌inal, Brussels, 3.3.2010, 24.

6European Commission, Communication from the Commission to the Council, the European Parliament,

the European Social and Economic Committee and the Committee of the Regions, Trade, Growth and

World Affairs: Trade Policy as a Core Component of the EU’s 2020 Strategy, COM(2010) 612 f‌inal,

Brussels, 9.11.2010, 3 [emphasis added].

7ibid,at15.

8The ‘Singapore issues’ refer to the four working groups set up during the WTO’s Ministerial Conference

of 1996 in Singapore: transparency in government procurement, trade facilitation (customs issues), trade

and investment and competition policy. These issues were in particular pushed by the EU at successive

Ministerial Conferences. They were originally included on the Doha Development Agenda, but in 2004

it was agreed to proceed only with negotiations in trade facilitation while the other three issues were

dropped.

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