EU Proposes Framework To Ensure Fair Trade

EU Proposes Framework To Ensure Fair Trade

Proposed regulation would allow for compensation if another WTO member country changes its trade regime

The European Commission Tuesday proposed new framework to enhance the EU's ability to enforce its rights in the international trading system.

The framework enables the European Commission to take executive action when the trade interests of the EU are at stake, rather than reacting on a case by case basis, according to a release from the Commission. The new proposal also would allow the EU to "implement trade responses in a more streamlined, efficient manner in order to encourage the offending country to remove the illegal measures."

Proposed regulation would allow for compensation if another WTO member country changes its trade regime

"The EU's membership in the World Trade Organization and bilateral trade agreements help the EU economy. Those agreements must be respected for them to deliver results. When international trade disputes prove that other countries haven't played by the rules, the EU needs to be able to react efficiently and swiftly to defend its interests", said EU Trade Commissioner Karel De Gucht.

The regulation would establish a plan for adopting implementing acts following international trade disputes that have a negative economic impact on the EU. In cases of last resort, trade sanctions can be put in place to encourage the offending country to remove illegal measures.

Action could also be taken to compensate for import restrictions that are imposed on EU products in exceptional situations (so-called safeguard measures), or to react to cases where a WTO member country changes its trade regime in a way that negatively affects EU trade (such as raising its import tariffs) without adequate compensation.

Such implementing acts can only be taken under certain well-defined conditions and might take the form of new or increased customs duties or quotas on imports or exports of goods, among other possible measures, the Commission notes.

The proposal will now be discussed by the Council and the European Parliament under the ordinary legislative procedure.

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