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VOL. 1 NO. 1 2009




Overview of the CarifOrum-EC
Economic Partnership agreement (EPa)
                                                                                                     Prepared by Caribbean regional Negotiating machinery




Background

The Economic Partnership Agreement (EPA)                               WhAt ARE PREFERENCEs?                                                       CARIFORUM members of the
was signed by the 27 European Union member                             a preference is a concession offered                                        EPA: antigua and Barbuda,
states and 14 CARIFORUM states (all except                             in a trade agreement by a Party to                                          Bahamas, Barbados, Belize,
Haiti) in October 2008 and it came into effect                         another without offering that same                                          Dominica, Dominican republic,
through provisional application in December                            concession to a third Country. for                                          Grenada, Guyana, Haiti,
2008. It replaces the trade provisions of the                          instance in the LOmE Convention the                                         Jamaica, St. Kitts and Nevis,
Cotonou Agreement, signed in 2000, in which                            European Community offered duty free                                        St. Lucia, St. Vincent and
the European Community unilaterally granted                            quota free market access for a range                                        the Grenadines, Suriname,
African, Caribbean and Pacific (ACP) countries                         of products that originated from the                                        Trinidad and Tobago
non-reciprocal market access to Europe on more                         africa Caribbean and Pacific regions
favourable terms than those enjoyed by goods                           and exported to the EC market.                                              European Union members
from other countries. There was special access for                                                                                                 of the EPA: austria, Belgium,
some traditional exports like sugar, rum, rice into                                                                                                Bulgaria, Cyprus, Czech
the European market which was very important                      which meets the substantive criteria of Article                                  republic, Denmark, Estonia,
to ACP countries.                                                 XXIV of the GATT or Article V of the General                                     finland, france, Germany,
    The Cotonou’s non-reciprocal trade prefer-                    Agreement on Trade in Services (GATS) respec-                                    Greece, Hungary, ireland, italy,
ences required a waiver in the World Trade                        tively. In exchange for the waiver, the EU and                                   Latvia, Lithuania, Luxembourg,
Organization (WTO) because it was contrary to                     ACP states had agreed to replace the Cotonou                                     malta, Netherlands, Poland,
the basic rule enshrined in Article 1 of the GATT,                preferential trade arrangement with a reciprocal,                                Portugal, romania, Slovakia,
that all members must be treated no less than                     WTO-compatible agreement by the end of 2007.                                     Slovenia, Spain, Sweden,
any other member (most favoured nation (MFN)                      The CARIFORUM-EC EPA is the first EPA to be                                      united Kingdom
principle) unless they belong to a regional trade                 completed between Europe and one of the six
agreement or economic integration agreement                       sub-regions of the ACP.


                      Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.   1
The EPA contains rules to ensure that trade
and investment between CARIFORUM and the
European Union is conducted on a transparent
and predictable basis while accommodating the                               What does the EPA look like?
marked differences in size and level of develop-
ment between the two regions.
                                                                            The EPa is divided into six parts and                            Part iV: General Exceptions
Objectives                                                                  contains annexes and protocols.
                                                                            The main sections are as follows:                                Part V: institutional Provisions
The EPA as a trade agreement with development
components, is designed to open up and enhance                              Part i: Trade Partnership for                                    Part Vi: General and final Provisions
trade between Europe and CARIFORUM by                                                 Sustainable Development
removing the barriers to trade between them and                                                                                              Seven annexes {Due to its size,
by improving CARIFORUM’s capacity to trade                                  Part ii: Trade and Trade-related matters                         the CarifOrum Schedule of Tariff
competitively. Through enhanced open trade, it is                                       title I. Trade in Goods                              Liberalization for goods from the EC
expected that the EPA will:
                                                                                        title II. investment, Trade in                       (appendix to annex iii) is contained in a
 • Expand and improve CARIFORUM’s industries
                                                                                        Services and E-commerce                              separate document but all the schedules
    and economic growth by enabling CARIFORUM
                                                                                        title III. Current Payments and                      for services and investment (annex iV)
    States to develop exports in services and a wider
                                                                                        Capital movements                                    are included in the main EPa document}.
    range of goods in which they have a compara-
    tive advantage;                                                                     title IV. Trade-related issues
 • Increase employment and business opportunities;                                                                                           Three Protocols
 • Improve CARIFORUM’s access to European                                   Part iii: Dispute avoidance and
    technology and technical ‘know how’;                                                 Settlement                                          final act
 • Increase competition within CARIFORUM
    and thereby improve efficiency in produc-
    tion processes.




Part II: Trade and Trade-related Matters
                                                                                                                                            on items subject to phased reduction
                                                                                                                                            commitments, until 2011. This is what is
                                                                                                                                            referred to as the 3-year moratorium. This
                                                                                                                                            group of items includes products which
                                                                                                                                            either have a high degree of revenue
                                                                                                                                            sensitivity or are produced by domestic
                                                                                                                                            industries which require a degree of
                                                                                                                                            protection from the competition posed
                                                                                                                                            by imports.
                                                                                                                                          • Tariffs on very sensitive goods such as
Title 1: Trade in Goods                                                                                                                     food items and processed food imported
                                                                                                                                            into CARIFORUM will not be removed.
ChAPtER 1                                                                                                                                   Altogether 13.1 % of products imported
CUstOMs DUtIEs                                                     highlights                                                               from Europe will continue to be subject
                                                                   • Immediate duty-free/quota-free market                                  to tariffs. These products makeup the
In keeping with the concept of special and                            access for all CARIFORUM goods into the                               Exclusions List.
differential treatment, CARIFORUM States                              EU except rice and sugar. (This was imple-                          • Tariffs have been a significant source of
will reduce tariffs on imported goods, but                            mented in January 2008). In the case of                               revenue for some CARIFORUM States
not to the same extent, or at the same pace                           rice and sugar, full liberalization will not                          so they will reduce tariffs on products
as Europe. In addition, less onerous commit-                          occur until 2010 and 2015 respectively.                               from the EU gradually in several Phases.
ments have been agreed upon for the smaller                        • On the other hand, CARIFORUM is                                        This will allow CARIFORUM time to
CARIFORUM states.                                                     not obliged to begin reducing its tariffs                             find alternative revenue sources and


2    Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
for CARIFORUM industries to adjust to
  increased competition. The tariff liberal-
  ization regime is as follows:
   • In 2009 CARIFORUM will remove
       tariffs on 52.8 % of the goods
       imported from Europe pursuant
       to the commitment to apply a zero
       rate of duty on these goods at this
       time. The revenue impact on the
       CAREIFORUM States associated with
       the liberalization of these products
       will either non-existent or relatively
       minor, as prior to the conclusion
       of the EPA, most of these products
       already faced applied rates of zero
       percent or close to zero percent;
                                                                                                REDUCtION OF tRADE BARRIERs
   • In five years from the date of applica-
       tion of the EPA (2013), CARIFORUM
       will remove tariffs on 56% of the goods              In 10 years or by 2018, tariffs will be removed from 61.1 % of the goods
       imported from Europe;                                imported from Europe...
   • In 10 years or by 2018, tariffs will be
       removed from 61.1 % of the goods
       imported from Europe;                                     are biscuits and other bakery products,                                  WTO Safeguard Clause subject to the
   • In 15 years or by 2023, 82.7% will be                       jams and jellies, fruit juices and other                                 terms and conditions of Article XIX of
       liberalized;                                              beverages, garments, and air condi-                                      the General Agreement on Tariffs and
   • In 20 years or by 2028, 84.6% will be                       tioning units. As was the case under the                                 Trade (GATT);
       liberalized;                                              Cotonou Agreement, inputs obtained                                   • The CARIFORUM States and Europe
   • In 25 years or by 2033, tariffs on the                      from any CARIFORUM country, the EC,                                      can resort to the use of a bilateral
       remaining CARIFORUM products will                         other ACP countries (with some excep-                                    safeguard mechanism created by the
       be eliminated, and this will take the                     tions) and, under certain conditions,                                    Agreement for a limited period of
       total level of liberalization to 86.9%.                   neighbouring developing countries,                                       time in the event that the importa-
• Most Favoured Nation (MFN) principle–                          will qualify as “originating goods” and                                  tion of goods from the other side
  The CARIFORUM States or the EU                                 so can be used in the production of                                      only, causes or threatens to cause: (a)
  must give the same terms to the other                          final goods that will qualify for prefer-                                serious injury to domestic industries;
  side if under another trade agreement                          ential treatment.                                                        or (b) sectoral disturbances that
  concluded after the EPA:                                                                                                                cause major social problems; or (c)
    • The EU gives to a non-CARIFORUM                       ChAPtER 2                                                                     disturbances to agricultural markets
       country or group more advantageous                   tRADE DEFENCE MEAsUREs                                                        or mechanisms that regulate those
       treatment than those in the EPA.                                                                                                   markets. These safeguards are not
    • CARIFORUM States extend to a “major                   This chapter outlines the circumstances                                       subject to the WTO dispute settle-
       trading economy” treatment which is                  appropriate for either CARIFORUM or                                           ment provisions.
       more advantageous than that offered                  Europe to impose temporary barriers to                                 • Permitted use of Anti-Dumping Duties
       to Europe under the EPA.                             trade, including tariffs.                                                in accordance with corresponding WTO
• Rules of Origin (RoO) govern the iden-                                                                                             provisions to prevent the unfair and
  tification of goods that will qualify for                 highlights                                                               predatory trade practice of selling goods
  preferential treatment under the EPA.                     • Permitted use of Safeguards, which are                                 in overseas markets at less than their cost
  The EPA RoO are based on the struc-                          barriers to trade imposed temporarily                                 of production.
  ture and principles of those contained                       to prevent injury to domestic industries                            • In accordance with the WTO Agreement on
  in the Cotonou Agreement. There has,                         caused by imports:-                                                   Subsidies and Countervailing Measures,
  however, been some relaxation of the                          • In cases where increased imports                                   Countervailing Measures such as duties
  qualifying conditions for a number of                            from the other side as well as third                              can be employed to prevent unfair compe-
  products, thereby making it easier for                           state sources are causing injury to a                             tition between subsidized imports and
  CARIFORUM producers to export to                                 domestic industry, the CARIFORUM                                  competing domestic products.
  the EC. Examples of these products                               States and Europe can invoke the


                      Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.   3
ChAPtER 3:
NON-tARIFF BARRIERs

This chapter addresses the reduction of the use
of other measures other than tariffs such as
quotas and import or export licenses which,
by way of their application impede trade. Both
sides agreed not to apply quantitative restric-
tions, including import licenses. The rules also
seek to ensure there is no unfair competition
between imports and like domestic products
within the domestic market.

highlights
• The EPA reaffirms the provision of the
    GATT to the extent that discrimination
    against imports is prevented through the
    application of the National Treatment
    (NT) principle:-
     • No charges and internal taxes may
         be applied to imports if they are not
         similarly applied to like domestic                        From January 2008 until September 2009, CARIFORUM will be
         products;                                                 eligible to export an additional 60,000 tonnes of sugar into Europe.
     • Regulations and laws affecting internal
         sale, offers for sale, purchase, transpor-
         tation, distribution or use of a product,                     Europe’s respective customs operations                            providing support in a range of areas, e.g.
         must be applied to both the imports                           are required through commitments to:                              research, downstream processing, improving
         and similar domestic products;                                 • reduce, simplify and standardize                               production and quality standards, and
     • The application of the NT principle in                              customs data and documentation;                               promoting investment. A special process of
         the EPA does not prevent a govern-                             • simplify procedures for goods clearance;                       dialogue between the two sides will be set up
         ment from offering domestic support                            • publicly disclose customs laws, proce-                         to address agricultural and fisheries issues.
         to national producers.                                            dures and explanations of such laws
    Although Europe is obliged to eliminate                                and procedures;                                               highlights
export subsidies on products which the                                  • cooperate and dialogue between                                 • Seventy five percent of all CARIFORUM’s
CARIFORUM countries have agreed to liber-                                  CARIFORUM and Europe.                                            imports of agricultural and fisheries
alize, the CARIFORUM countries are able to                           • The provision of financial and non-finan-                            products have been excluded from liber-
maintain this type of subsidy on their prod-                           cial support to CARIFORUM to assist in:                              alization under the EPA. These sensitive
ucts for the duration of the transition periods                         • Development of modern customs                                     products will continue to be protected by
afforded to developing countries by both the                               techniques;                                                      tariffs applied by CARIFORUM states.
Agreement on Agriculture and the SCM.                                   • Automation of customs and other                                • Liberalization commitments have also
                                                                           trade procedures;                                                been back-loaded with only 29% of tariff
ChAPtER 4                                                               • Compliance with relevant interna-                                 lines being subject to tariff elimination by
CUstOMs AND tRADE                                                          tional standards and regulations                                 the end of year 10.
FACILItAtION                                                               including WTO rules, the Kyoto                                 • There are also special provisions on tradi-
                                                                           Convention and the World Customs                                 tional agricultural exports.
The Chapter sets out to improve customs and                                Organization (WCO).                                               Sugar
trade administrative procedures to ensure                                                                                                    • From January 2008 until September
that trade between CARIFORUM and Europe                            ChAPtER 5                                                                    2009, CARIFORUM will be eligible to
is made easier and that trading procedures                         AgRICULtURE AND FIshERIEs                                                    export an additional 60,000 tonnes
are more predictable.                                                                                                                           of sugar into Europe. This quantity,
                                                                   Agriculture and fisheries are an important                                   which is above the Sugar Protocol
highlights                                                         part of the EPA. There is a chapter dedicated                                quota, is to be shared between
• Transparency, efficiency, accountability                         to the issues, which addresses the development                               CARICOM signatories to the Protocol
   and integrity of CARIFORUM’s and                                needs of these sectors and commits the EU to                                 and with the Dominican Republic.


4    Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
• After September 2009, when the Sugar                                                                                               purpose of such goods access into the
   Protocol expires, CARIFORUM sugar                   Commitment to designate contact                                               EC market.
   imported into Europe will be free of                points to facilitate the channelling                                        • Firms’ capacity to comply with inter-
   duty. However, between October 1,                                                                                                 national regulatory requirements.
                                                       and exchange of information
   2009 and September 2015 Europe can
   still impose tariffs on CARIFORUM                   regarding technical regulations,                                      ChAPtER 7
   sugar exports under very special                    standards and conformity assess-                                      sANItARy AND PhytOsANItARy
   circumstances.                                                                                                            (sPs) MEAsUREs
Rice
                                                       ment procedures as defined in the
• CARIFORUM rice exporters will                        WTO Technical Barriers to Trade                                       Provisions under this Chapter outline how
   receive increased quotas of 187,000                                                                                       either CARIFORUM or Europe may use
                                                       Agreement.
   tonnes for 2008 and 250,000 tonnes                                                                                        trade restrictions designed to protect risks to
   for 2009. These quotas will be duty                                                                                       humans, animals or plants associated with
   free in contrast to the €65 per tonne                                                                                     disease, pests and contaminants. At the same
   duty that would have applied.                       ChAPtER 6                                                             time, these provisions aim to prevent unin-
• Licensing and other arrangements                     tEChNICAL BARRIERs tO tRADE                                           tended impediments to trade which may come
   related to the rice quota will be                                                                                         about because of these trade measures. There
   kept under review to ensure that                    This aspect of the EPA is aimed at helping both                       are also inclusions in this chapter aimed to
   CARIFORUM rice producers get the                    CARIFORUM and European states to comply                               assist CARIFORUM to comply with European
   maximum benefits from the trading                   with each other’s mandatory standards. At                             sanitary and phytosanitary (SPS) measures
   arrangement.                                        the same time, these provisions help ensure                           and to better develop their own regionally
• Duty-free/quota free access for rice                 that lack of information about such standards                         harmonized SPS measures.
   from 2010. Under the new arrange-                   does not unnecessarily impede trade between
   ment there is no distinction between                CARIFORUM and Europe.                                                 highlights
   whole grain and broken rice. This                                                                                         • Commitment to cooperate in establishing
   makes it easier for CARIFORUM rice                  highlights                                                               harmonized SPS measures both in the EU
   producers to benefit from the higher                • Commitment to designate contact points                                 and between CARIFORUM States;
   priced market for whole grain rice.                    to facilitate the channelling and exchange                          • Commitment to establish arrangements
Bananas                                                   of information regarding technical regu-                              to facilitate the recognition of equivalence
• Duty-free/quota free access from                        lations, standards and conformity assess-                             of specified SPS measures;
   inception of the EPA.                                  ment procedures as defined in the WTO                              • Agreement that in the event that no
• Joint Declaration on Bananas which                      Technical Barriers to Trade Agreement.                                harmonized SPS measures exist or
   commits the EU to assist in funding                 • Financial and non-financial development                                there is no recognition of equivalence,
   the CARIFORUM banana industry’s                        support to assist with the development of:                            CARIFORUM and Europe will consult on
   socio-economic adjustments to the                       • CARIFORUM centres of expertise                                     ways to facilitate trade and reduce unnec-
   changing trading environment.                               for the assessment of goods for the                              essary administrative requirements.




                 Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.   5
Title 2: Investment,
               Services & E-Commerce




               This title contains comprehensive rules and regulatory principles                                 •     The EU liberalized more than 90% of its services sectors and
               for services and investment including national treatment and                                            all modes of supply.
               most favoured nation treatment. Both sides agreed to cooperate                                          CARIFORUM states scheduled 50-75% of service sectors in
               on e-commerce and not to charge customs duties on electroni-                                            order to facilitate investment and the transfer of technology.
               cally delivered products. It also contains cooperation provisions                                       The main new areas of market opening by CF include:
               to develop and improve the CARIFORUM services sector. Exclu-                                            • Business services
               sions from coverage are: audio-visual services; maritime cabo-                                          • Computer and computer related services
               tage; arms and munitions; some air services, nuclear materials.                                         • Research and Development
                                                                                                                       • Environmental services
               ChAPtER 2                                                                                               • Management consultancy
               COMMERCIAL PREsENCE                                                                                     • Maritime Transport
                                                                                                                       • Entertainment
               The EPA contains the standard rules on investment such as                                               • Tourism
               national treatment and MFN but it also includes provisions to
               safeguard the public interest. It requires that governments take                                ChAPtER 4
               measures to ensure that investors safeguard the environment                                     tEMPORARy PREsENCE OF NAtURAL
               and maintain high labour and occupational health and safety                                     PERsONs FOR BUsINEss PURPOsE
               standards. And governments are bound not to lower standards
               to attract investment. Furthermore, they are required to take                                   The EPA has clearer rules for the temporary movement of
               measures that forbid investors from engaging in corruption of                                   natural persons (mode 4 in GATS jargon) than the WTO
               public officials to obtain concessions or favours.                                              because it introduces specific categories of service suppliers
                                                                                                               that can gain entry into the markets of either Party. (See
               ChAPtER 3                                                                                       Table). The EU’s commitments on the Movement of Natural
               CROss BORDER sUPPLy OF sERVICEs                                                                 Persons in the EPA are significantly greater than their GATS
                                                                                                               commitments and conditional services offer in the Doha
               This chapter contains similar rules on national treatment and                                   Round thereby granting better treatment to Caribbean
               most favoured nation treatment and addresses the access which                                   suppliers. As expected, CARIFORUM made significantly
               CARIFORUM and Europe will provide to each other in services                                     less commitments in mode 4 and mainly for intra-corpo-
               which are traded across their borders.                                                          rate transfers.


6   Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
highlights



 Category of Person                                        Main Criteria                                                         Length of stay Allowed



 (i) Key personnel, which includes:

 Business visitors                                         Persons responsible for setting up a                                  90 days per calendar year
                                                           commercial presence and paid by a source
                                                           outside of the host territory.

 intra-corporate transfers                                 Persons employed by a company in the                                  up to 3 years
      - managers                                           sending country at least a year before entry
      - Specialists                                        to the host country to work within a partner
                                                           company there.

 (ii) Graduate trainees                                    university graduates, employed by a                                   up to 1 year
                                                           company for at least a year and entering
                                                           either Party for career development or
                                                           training in a branch or parent company.

 (iii) Business services sellers                           Persons entering to negotiate a sale or an                            90 days per year
                                                           agreement but who receive remuneration
                                                           from a source outside of a Party and do not
                                                           make direct sales.

 (iv) Contractual Service Suppliers (CSS).                 Professionals with 3 years experience                                 up to 6 months per year
                                                           employed by a company in the sending
                                                           country, which does not have a presence in
                                                           the other party but has a service contract
                                                           with a client in the other party.

 (v) independent Professionals (iP)                        Self-employed professionals with 6 years                              up to 6 months per year
                                                           experience and service contract.

 (vi) Short Term Visitors for Business                     Persons that are not selling services can                             up to 90 days per year
 Purpose                                                   enter either Party to perform a range of
                                                           activities such as: research and design,
                                                           marketing research, training, trade fairs and
                                                           exhibitions, sales, purchasing and tourism


The EU opened 29 sectors to allow                           that may enter the EU. There is also an                               to CARIFORUM and Europe in: Computing
professional employees of CARIFORUM                         innovative Protocol on Cultural Coopera-                              services; Courier services; Telecommuni-
firms referred to as “contractual service                   tion to complement CARIFORUM market                                   cations; Financial services and Tourism.
suppliers” (CSS) to enter the EU to supply                  access in EU Recreational services markets                            The chapter also provides for development
services for up to 6 months in a year. This                 and to facilitate greater cooperation in                              support to:
includes new areas such as entertainment,                   the development of cultural industries. It                                • Develop the capacity of CARIFORUM
fashion model, chef de cuisine services,                    also provides for co-produced audiovisual                                    firms
which do not need university degrees.                       works to be treated as domestic content in                                • Develop sectoral standards and regu-
Eleven (11) sectors have been opened                        the EU and CARIFORUM.                                                        latory regimes
up to allow self-employed CARIFORUM                                                                                                   • Build human resources within
professionals to enter the EU to supply                     ChAPtER 5                                                                    CARIFORUM through training
services for up to 6 months. There are                      sECtORAL RULEs                                                            • Develop equivalence of CARIFORUM
some restrictions in the newer EU member                    A regulatory framework is outlined for key                                   skills and Mutual Recognition of
states but no limits on the number of CSS                   sectors of particular development interest                                   qualifications


                      Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.   7
Title 3: Current Payments &
Capital Movement
CARIFORUM and Europe have agreed not                               for no more than six months in the event
to impose restrictions on the free move-                           that current payments and capital move-
ment of capital related to direct invest-                          ment cause or threaten to cause difficulties
ments. They have the right to implement                            with the operation of monetary policy or
preventative or precautionary measures                             exchange rate policy.




Title 4: Trade-Related Issues




These provisions are intended to complement                        sharing information etc) in the investigation                         research and development, and participation
and support the EPA’s economic and sustainable                     of alleged anti-competitive practices.                                in joint ventures. The intellectual property
development focus by improvements in areas                                                                                               provisions aim to help create a suitable
that affect quality of life and competitiveness.                   ChAPtER 2                                                             legislative and administrative environment
                                                                   INNOVAtION AND INtELLECtUAL                                           which will provide protection of intellectual
ChAPtER 1                                                          PROPERty                                                              property. CARIFORUM and Europe agreed
COMPEtItION                                                                                                                              to adequately implement their obligations
These provisions ensure that competition is                        The aim is to help create an environment that                         under agreements which address intellectual
free from distortion and is fair. By so doing the                  fosters creativity and innovation within the CARI-                    property to which they may be signatory,
interest of both consumers and businesses                          FORUM States. The creation of new products,                           such as the WTO TRIPS Agreement.
especially small business will be protected.                       marketing techniques and business practices can                        • CARIFORUM LDCs are not obligated to
There are rules against anti-competitive busi-                     improve economic growth and development.                                  apply the provisions under the Intellectual
ness practices such as the abuse of market                                                                                                   Property section until 2014;
power and dominance, and a commitment to                           The EPA seeks to facilitate the develop-                               • There will be support to develop and
establish legislation to prevent such practices                    ment of CARIFORUM innovation systems                                      enforce the protection of intellectual
by firms. There are also provisions allowing                       to enhance the competitiveness of CARI-                                   property, including geographical indica-
the Parties, if they so desire, to cooperate (by                   FORUM firms through technology transfer,                                  tions and traditional knowledge.


8    Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
ChAPtER 3                                                    • These provisions are subject to dispute
PUBLIC PROCUREMENt                                             settlement procedures only after all
                                                               stages of a three stage dispute avoidance
The Public Procurement chapter sets out                        process have been completed.                                              Development Funding
comprehensive rules governing the transpar-
ency of procurement activities of the Parties.              ChAPtER 6                                                                    funding for the implementation of the
Obligations address all aspects of the procure-             PERsONAL DAtA PROtECtION                                                     EPa will emanate from a variety of
ment process including the publication of                                                                                                sources. Principal among these are
relevant national laws and regulations,                     The principles and general rules established                                 the CarifOrum regional indicative
publication of procurement notices, as well                 under these provisions are intended to                                       Programme (CriP), National indicative
as equal and timely access by suppliers to                  establish a legal regime which allows for the                                Programmes (NiPs), the Eu member
relevant documentation and other pertinent                  personal data of CARIFORUM and EC citi-                                      States’ aid for Trade (afT) contributions
information. However, the provisions do not                 zens and residents to be protected during data                               and the Seventh framework Programme
confer rights of access to the procurement                  processing operations.                                                       (fP7). Both the CriP and NiPs are
markets of the Parties. Governments are there-                                                                                           funded from the EC through the
fore free to open or restrict, as the case may              •  Commitment to establish regulatory                                        European Development fund. The 10th
be, their public procurement opportunities, in                 and legal regimes which are designed to                                   CriP has an allocation of €165 million
accordance with their own national laws.                       facilitate the collection and processing                                  of which €70 million is reserved for
                                                               of personal data especially with regard                                   direct EPa implementation. The CriP is
ChAPtER 4                                                      to services based on data transfer whist                                  complemented by NiPs – a number of
ENVIRONMENt                                                    ensuring the protection of privacy of                                     which entail funding supportive of EPa
                                                               customers and transparency.                                               implementation. for example, the €289
These provisions are designed to assist the                  • Financial and non-financial support to                                    million NiP for the Dominican republic
prevention of environmental degradation as a                   develop legal and regulatory regimes in                                   focuses on enhancing competitiveness
result of trade.                                               CARIFORUM.                                                                while that for a major share of the €80
                                                                                                                                         million Jamaican NiP targets trade
highlights                                                                                                                               development. These envelopes of
• Provisions to prevent the degradation of                                                                                               financial assistance to CarifOrum are
   the environment and to foster sustainable                                                                                             additional to current EC funding of the
   development;                                                                                                                          adjustment in major Caribbean industries
• Right of CARIFORUM and Europe to                                                                                                       such as sugar, banana, rum and rice.
   regulate environmental protection in
   accordance with their own sustainable
   development priorities but in a manner
   that does not cause arbitrary or unjustifi-
   able discrimination against each other;
• These obligations are subject to dispute
   settlement procedures only after all
   stages of a three stage dispute avoidance
   process have been completed.

ChAPtER 5
sOCIAL AsPECts

These provisions are indicative of the Parties
acknowledgment of the need to pursue trade
and the benefits of trade while upholding
international labour standards.

• Reaffirmed commitment to ILO labour
  rights and standards;
• Prevention of the use of labour standards
  for protectionist trade purposes;



                      Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.   9
Part III – Dispute Avoidance and Settlement




              These provisions are designed to avoid and settle disputes that                                         breach of the EPA.
              may arise between the EC and its member states and the CARI-                                      •     Europe must exercise restraint in imposing such sanctions
              FORUM states                                                                                            and in seeking trade compensation from the CARIFORUM
                                                                                                                      States. There is no corresponding CARIFORUM obligation.
              ChAPtER 1
              ARBItRAtION PROCEDURE                                                                           ChAPtER 3
                                                                                                              COMMON PROVIsIONs
                •      Dispute resolution is facilitated within three tiers
                       • Consultation                                                                           •     Dispute settlement provisions of the EPA are without
                       • Mediation                                                                                    prejudice to any action in the WTO framework, including
                       • Arbitration                                                                                  dispute settlement action;

              ChAPtER 2                                                                                         •     Where the EC Party or a CARIFORUM State has started the
              COMPLIANCE                                                                                              dispute settlement process with regard to a particular issue
                                                                                                                      under the Dispute settlement proceedings of either the EPA
                •      In the event that the EC Party is successful in a dispute,                                     or the WTO, that Party may not start new dispute settlement
                       sanctions can only be imposed on the individual                                                proceedings in another forum until the first proceeding has
                       CARIFORUM State or States which have been found to be in                                       been determined.




               Part IV – General Exceptions
              These provisions stipulate the circumstances in which CARI-                                     mentation of national (or as the may be, regional) measures to
              FORUM or Europe may derogate from the rules under the EPA.                                      protect: public morals; public security, human, plant or animal
              Such derogations would only be permitted if they are grounded                                   health and life. The EPA does not prevent the implementation of
              factually on one or more of several specified matters and do                                    measures by CARIFORUM or Europe to prevent tax evasion or
              not constitute disguised restrictions on trade or are applied in                                tax avoidance.
              a discriminatory matter. The EPA does not prevent the imple-




10   Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
Part V – Institutional Provisions

These provisions facilitate the establishment of institutions                                       in an expeditious manner and that the development
vested with specific responsibilities essential to ensuring that the                                dimension of the EPA is fulfilled.
objectives of the EPA are met. They are modelled on the structure
of Cotonou Institutional Provisions and present a structure of                           The CARIFORUM-EC Parliamentary Committee
governance with which the CARIFORUM States are familiar.                                      • Comprised of representatives from the European
They are as follows:                                                                            Parliament and the legislatures of the CARIFORUM
                                                                                                States
 The Joint CARIFORUM-EC Council:                                                              • Facilitates meeting and exchange of views of these
      • Highest institution                                                                     representatives on the implementation of the EPA
      • Will meet at Ministerial level at regular intervals not
          exceeding two years                                                            The CARIFORUM-EC Consultative Committee
      • Is vested with responsibility to supervise the imple-                                 • Designed for the engagement of civil society in the
          mentation of the EPA                                                                  EPA implementation process.
      • May take decisions concerning any aspect of the agree-                                • Composition to be determined by the Joint
          ment as jointly agreed by CARIFORUM and the EC.                                       CARIFORUM-EC Council

 The CARIFORUM-EC Trade and Development Committee                                      None of these Institutions involve supra-nationality or the
      • Second highest institution                                                     ceding of sovereignty of the CARIFORUM States or the EU.
      • Assists the Joint CARIFORUM-EC Council                                         Governments on both sides have only jointly agreed to delegate
      • Vested with specific responsibilities vital to ensuring                        authority on issues relating specifically to the implementation
        that all matters affecting the partnership are resolved                        of the EPA to these institutions.




                      Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.   11
Part VI – General and Final Provisions


     ABOUt Us

     Our Vision

     Caribbean Export is a catalyst
     for regional economic prosperity
     through strategic interventions
     on trade development and
     investment promotion

     Our Mission

     To increase the competitiveness
     of Caribbean countries
     by providing quality trade
     development and investment
     promotion services through
     effective programme execution                       These provisions express final arrangements to                                       Countries (LDCs) of CARICOM and the
     and strategic alliances.
                                                         be facilitated.                                                                      Dominican Republic on all other goods;
     Key Result Areas and goals                                                                                                      •    Market access and trade as covered in all areas
     Fostering an enabling                               •    From the signature of the EPA CARIFORUM                                     under the Agreement are facilitated between
     environment – for trade and                              states are obliged to extend to each other any                              the Outermost Regions of Europe.
     investment within the region                             advantage that is extended to Europe:                                  •    Provides for the possibility of revising the EPA in
     through regional integration,
     cooperation and advocacy
                                                               • With immediate effect between CARICOM                                    order to:
     initiatives designed to position                             and the Dominican Republic on all duties                                 • include the Overseas Countries and
     the region more effectively in the                           attracting zero rated duty;                                                 Territories (OCTs) associated with the
     world economy.
                                                               • Within 1 year between More Developed                                         European Community;
     Enhancing Competitiveness –                                  Countries (MDCs) of CARICOM and the                                      • adjust to the pending expiration of the
     increase the competitiveness of
                                                                  Dominican Republic on all other goods;                                      Cotonou Agreement in 2020;
     firms in CarifOrum countries
     in selected sectors through                               • Within 2 years between Less Developed                                     • broaden and supplement the scope of the EPA.
     investment, management
     and product development,
     market expansion and export
     diversification.

     Promoting Investment – Promote
                                                             this tradewins is a joint publication of the Caribbean Export Development Agency
     the Caribbean region as a prime
     destination for intra and extra-                        (Caribbean Export) and the Caribbean Regional Negotiating Machinery (CRNM).
     regional investment.                                    Caribbean Export Development Agency                                                                Caribbean Regional Negotiating
     Strengthening Institutional                             head Office                                        sub Regional Office                             Machinery (CRNM)
     Capacity and Networking –                               mutual Building, Hastings main road,               Calle Carlos Lora No. 9                         3rd floor, the mutual Building
     Enhance the capacity of public                          Christ Church, BB15154                             Ensanche Los restauradores                      Hastings main road, Hastings,
     and private sector BSOs,                                Mailing Address                                                                                    Christ Church
                                                                                                                Santo Domingo
     particularly sector associations,                                                                                                                          Barbados
                                                             P.O. Box 34B, Brittons Hill Post Office,           DOmiNiCaN rEPuBLiC
     trade promotion organisations                                                                                                                              Tel: (246) 430-1670
                                                             St. michael, BB14000, BarBaDOS                     Tel: +1 (809) 531-2411
     and investment promotion
                                                             Tel: +1(246) 436-0578                              fax: +1 (809) 473-7532                          fax: (246) 228-9528
     agencies, and support the
     development of vibrant                                  fax: +1(246) 436-9999                              E-mail: c.export@codetel.net.do
     Caribbean business networks to                          E-mail: info@carib-export.com
     improve services to clients.                                                    Website: www.carib-export.com



                                                             We are very interested in your feedback. Please email your comments to tradewins@carib-export.com.

                                                             all material copyright © 2009 Caribbean Export.




12       Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.

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TradeWins - Overview of the CF-EC Economic Partnership Agreement (EPA) vol.1 June2009

  • 1. VOL. 1 NO. 1 2009 Overview of the CarifOrum-EC Economic Partnership agreement (EPa) Prepared by Caribbean regional Negotiating machinery Background The Economic Partnership Agreement (EPA) WhAt ARE PREFERENCEs? CARIFORUM members of the was signed by the 27 European Union member a preference is a concession offered EPA: antigua and Barbuda, states and 14 CARIFORUM states (all except in a trade agreement by a Party to Bahamas, Barbados, Belize, Haiti) in October 2008 and it came into effect another without offering that same Dominica, Dominican republic, through provisional application in December concession to a third Country. for Grenada, Guyana, Haiti, 2008. It replaces the trade provisions of the instance in the LOmE Convention the Jamaica, St. Kitts and Nevis, Cotonou Agreement, signed in 2000, in which European Community offered duty free St. Lucia, St. Vincent and the European Community unilaterally granted quota free market access for a range the Grenadines, Suriname, African, Caribbean and Pacific (ACP) countries of products that originated from the Trinidad and Tobago non-reciprocal market access to Europe on more africa Caribbean and Pacific regions favourable terms than those enjoyed by goods and exported to the EC market. European Union members from other countries. There was special access for of the EPA: austria, Belgium, some traditional exports like sugar, rum, rice into Bulgaria, Cyprus, Czech the European market which was very important which meets the substantive criteria of Article republic, Denmark, Estonia, to ACP countries. XXIV of the GATT or Article V of the General finland, france, Germany, The Cotonou’s non-reciprocal trade prefer- Agreement on Trade in Services (GATS) respec- Greece, Hungary, ireland, italy, ences required a waiver in the World Trade tively. In exchange for the waiver, the EU and Latvia, Lithuania, Luxembourg, Organization (WTO) because it was contrary to ACP states had agreed to replace the Cotonou malta, Netherlands, Poland, the basic rule enshrined in Article 1 of the GATT, preferential trade arrangement with a reciprocal, Portugal, romania, Slovakia, that all members must be treated no less than WTO-compatible agreement by the end of 2007. Slovenia, Spain, Sweden, any other member (most favoured nation (MFN) The CARIFORUM-EC EPA is the first EPA to be united Kingdom principle) unless they belong to a regional trade completed between Europe and one of the six agreement or economic integration agreement sub-regions of the ACP. Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union. 1
  • 2. The EPA contains rules to ensure that trade and investment between CARIFORUM and the European Union is conducted on a transparent and predictable basis while accommodating the What does the EPA look like? marked differences in size and level of develop- ment between the two regions. The EPa is divided into six parts and Part iV: General Exceptions Objectives contains annexes and protocols. The main sections are as follows: Part V: institutional Provisions The EPA as a trade agreement with development components, is designed to open up and enhance Part i: Trade Partnership for Part Vi: General and final Provisions trade between Europe and CARIFORUM by Sustainable Development removing the barriers to trade between them and Seven annexes {Due to its size, by improving CARIFORUM’s capacity to trade Part ii: Trade and Trade-related matters the CarifOrum Schedule of Tariff competitively. Through enhanced open trade, it is title I. Trade in Goods Liberalization for goods from the EC expected that the EPA will: title II. investment, Trade in (appendix to annex iii) is contained in a • Expand and improve CARIFORUM’s industries Services and E-commerce separate document but all the schedules and economic growth by enabling CARIFORUM title III. Current Payments and for services and investment (annex iV) States to develop exports in services and a wider Capital movements are included in the main EPa document}. range of goods in which they have a compara- tive advantage; title IV. Trade-related issues • Increase employment and business opportunities; Three Protocols • Improve CARIFORUM’s access to European Part iii: Dispute avoidance and technology and technical ‘know how’; Settlement final act • Increase competition within CARIFORUM and thereby improve efficiency in produc- tion processes. Part II: Trade and Trade-related Matters on items subject to phased reduction commitments, until 2011. This is what is referred to as the 3-year moratorium. This group of items includes products which either have a high degree of revenue sensitivity or are produced by domestic industries which require a degree of protection from the competition posed by imports. • Tariffs on very sensitive goods such as Title 1: Trade in Goods food items and processed food imported into CARIFORUM will not be removed. ChAPtER 1 Altogether 13.1 % of products imported CUstOMs DUtIEs highlights from Europe will continue to be subject • Immediate duty-free/quota-free market to tariffs. These products makeup the In keeping with the concept of special and access for all CARIFORUM goods into the Exclusions List. differential treatment, CARIFORUM States EU except rice and sugar. (This was imple- • Tariffs have been a significant source of will reduce tariffs on imported goods, but mented in January 2008). In the case of revenue for some CARIFORUM States not to the same extent, or at the same pace rice and sugar, full liberalization will not so they will reduce tariffs on products as Europe. In addition, less onerous commit- occur until 2010 and 2015 respectively. from the EU gradually in several Phases. ments have been agreed upon for the smaller • On the other hand, CARIFORUM is This will allow CARIFORUM time to CARIFORUM states. not obliged to begin reducing its tariffs find alternative revenue sources and 2 Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
  • 3. for CARIFORUM industries to adjust to increased competition. The tariff liberal- ization regime is as follows: • In 2009 CARIFORUM will remove tariffs on 52.8 % of the goods imported from Europe pursuant to the commitment to apply a zero rate of duty on these goods at this time. The revenue impact on the CAREIFORUM States associated with the liberalization of these products will either non-existent or relatively minor, as prior to the conclusion of the EPA, most of these products already faced applied rates of zero percent or close to zero percent; REDUCtION OF tRADE BARRIERs • In five years from the date of applica- tion of the EPA (2013), CARIFORUM will remove tariffs on 56% of the goods In 10 years or by 2018, tariffs will be removed from 61.1 % of the goods imported from Europe; imported from Europe... • In 10 years or by 2018, tariffs will be removed from 61.1 % of the goods imported from Europe; are biscuits and other bakery products, WTO Safeguard Clause subject to the • In 15 years or by 2023, 82.7% will be jams and jellies, fruit juices and other terms and conditions of Article XIX of liberalized; beverages, garments, and air condi- the General Agreement on Tariffs and • In 20 years or by 2028, 84.6% will be tioning units. As was the case under the Trade (GATT); liberalized; Cotonou Agreement, inputs obtained • The CARIFORUM States and Europe • In 25 years or by 2033, tariffs on the from any CARIFORUM country, the EC, can resort to the use of a bilateral remaining CARIFORUM products will other ACP countries (with some excep- safeguard mechanism created by the be eliminated, and this will take the tions) and, under certain conditions, Agreement for a limited period of total level of liberalization to 86.9%. neighbouring developing countries, time in the event that the importa- • Most Favoured Nation (MFN) principle– will qualify as “originating goods” and tion of goods from the other side The CARIFORUM States or the EU so can be used in the production of only, causes or threatens to cause: (a) must give the same terms to the other final goods that will qualify for prefer- serious injury to domestic industries; side if under another trade agreement ential treatment. or (b) sectoral disturbances that concluded after the EPA: cause major social problems; or (c) • The EU gives to a non-CARIFORUM ChAPtER 2 disturbances to agricultural markets country or group more advantageous tRADE DEFENCE MEAsUREs or mechanisms that regulate those treatment than those in the EPA. markets. These safeguards are not • CARIFORUM States extend to a “major This chapter outlines the circumstances subject to the WTO dispute settle- trading economy” treatment which is appropriate for either CARIFORUM or ment provisions. more advantageous than that offered Europe to impose temporary barriers to • Permitted use of Anti-Dumping Duties to Europe under the EPA. trade, including tariffs. in accordance with corresponding WTO • Rules of Origin (RoO) govern the iden- provisions to prevent the unfair and tification of goods that will qualify for highlights predatory trade practice of selling goods preferential treatment under the EPA. • Permitted use of Safeguards, which are in overseas markets at less than their cost The EPA RoO are based on the struc- barriers to trade imposed temporarily of production. ture and principles of those contained to prevent injury to domestic industries • In accordance with the WTO Agreement on in the Cotonou Agreement. There has, caused by imports:- Subsidies and Countervailing Measures, however, been some relaxation of the • In cases where increased imports Countervailing Measures such as duties qualifying conditions for a number of from the other side as well as third can be employed to prevent unfair compe- products, thereby making it easier for state sources are causing injury to a tition between subsidized imports and CARIFORUM producers to export to domestic industry, the CARIFORUM competing domestic products. the EC. Examples of these products States and Europe can invoke the Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union. 3
  • 4. ChAPtER 3: NON-tARIFF BARRIERs This chapter addresses the reduction of the use of other measures other than tariffs such as quotas and import or export licenses which, by way of their application impede trade. Both sides agreed not to apply quantitative restric- tions, including import licenses. The rules also seek to ensure there is no unfair competition between imports and like domestic products within the domestic market. highlights • The EPA reaffirms the provision of the GATT to the extent that discrimination against imports is prevented through the application of the National Treatment (NT) principle:- • No charges and internal taxes may be applied to imports if they are not similarly applied to like domestic From January 2008 until September 2009, CARIFORUM will be products; eligible to export an additional 60,000 tonnes of sugar into Europe. • Regulations and laws affecting internal sale, offers for sale, purchase, transpor- tation, distribution or use of a product, Europe’s respective customs operations providing support in a range of areas, e.g. must be applied to both the imports are required through commitments to: research, downstream processing, improving and similar domestic products; • reduce, simplify and standardize production and quality standards, and • The application of the NT principle in customs data and documentation; promoting investment. A special process of the EPA does not prevent a govern- • simplify procedures for goods clearance; dialogue between the two sides will be set up ment from offering domestic support • publicly disclose customs laws, proce- to address agricultural and fisheries issues. to national producers. dures and explanations of such laws Although Europe is obliged to eliminate and procedures; highlights export subsidies on products which the • cooperate and dialogue between • Seventy five percent of all CARIFORUM’s CARIFORUM countries have agreed to liber- CARIFORUM and Europe. imports of agricultural and fisheries alize, the CARIFORUM countries are able to • The provision of financial and non-finan- products have been excluded from liber- maintain this type of subsidy on their prod- cial support to CARIFORUM to assist in: alization under the EPA. These sensitive ucts for the duration of the transition periods • Development of modern customs products will continue to be protected by afforded to developing countries by both the techniques; tariffs applied by CARIFORUM states. Agreement on Agriculture and the SCM. • Automation of customs and other • Liberalization commitments have also trade procedures; been back-loaded with only 29% of tariff ChAPtER 4 • Compliance with relevant interna- lines being subject to tariff elimination by CUstOMs AND tRADE tional standards and regulations the end of year 10. FACILItAtION including WTO rules, the Kyoto • There are also special provisions on tradi- Convention and the World Customs tional agricultural exports. The Chapter sets out to improve customs and Organization (WCO). Sugar trade administrative procedures to ensure • From January 2008 until September that trade between CARIFORUM and Europe ChAPtER 5 2009, CARIFORUM will be eligible to is made easier and that trading procedures AgRICULtURE AND FIshERIEs export an additional 60,000 tonnes are more predictable. of sugar into Europe. This quantity, Agriculture and fisheries are an important which is above the Sugar Protocol highlights part of the EPA. There is a chapter dedicated quota, is to be shared between • Transparency, efficiency, accountability to the issues, which addresses the development CARICOM signatories to the Protocol and integrity of CARIFORUM’s and needs of these sectors and commits the EU to and with the Dominican Republic. 4 Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
  • 5. • After September 2009, when the Sugar purpose of such goods access into the Protocol expires, CARIFORUM sugar Commitment to designate contact EC market. imported into Europe will be free of points to facilitate the channelling • Firms’ capacity to comply with inter- duty. However, between October 1, national regulatory requirements. and exchange of information 2009 and September 2015 Europe can still impose tariffs on CARIFORUM regarding technical regulations, ChAPtER 7 sugar exports under very special standards and conformity assess- sANItARy AND PhytOsANItARy circumstances. (sPs) MEAsUREs Rice ment procedures as defined in the • CARIFORUM rice exporters will WTO Technical Barriers to Trade Provisions under this Chapter outline how receive increased quotas of 187,000 either CARIFORUM or Europe may use Agreement. tonnes for 2008 and 250,000 tonnes trade restrictions designed to protect risks to for 2009. These quotas will be duty humans, animals or plants associated with free in contrast to the €65 per tonne disease, pests and contaminants. At the same duty that would have applied. ChAPtER 6 time, these provisions aim to prevent unin- • Licensing and other arrangements tEChNICAL BARRIERs tO tRADE tended impediments to trade which may come related to the rice quota will be about because of these trade measures. There kept under review to ensure that This aspect of the EPA is aimed at helping both are also inclusions in this chapter aimed to CARIFORUM rice producers get the CARIFORUM and European states to comply assist CARIFORUM to comply with European maximum benefits from the trading with each other’s mandatory standards. At sanitary and phytosanitary (SPS) measures arrangement. the same time, these provisions help ensure and to better develop their own regionally • Duty-free/quota free access for rice that lack of information about such standards harmonized SPS measures. from 2010. Under the new arrange- does not unnecessarily impede trade between ment there is no distinction between CARIFORUM and Europe. highlights whole grain and broken rice. This • Commitment to cooperate in establishing makes it easier for CARIFORUM rice highlights harmonized SPS measures both in the EU producers to benefit from the higher • Commitment to designate contact points and between CARIFORUM States; priced market for whole grain rice. to facilitate the channelling and exchange • Commitment to establish arrangements Bananas of information regarding technical regu- to facilitate the recognition of equivalence • Duty-free/quota free access from lations, standards and conformity assess- of specified SPS measures; inception of the EPA. ment procedures as defined in the WTO • Agreement that in the event that no • Joint Declaration on Bananas which Technical Barriers to Trade Agreement. harmonized SPS measures exist or commits the EU to assist in funding • Financial and non-financial development there is no recognition of equivalence, the CARIFORUM banana industry’s support to assist with the development of: CARIFORUM and Europe will consult on socio-economic adjustments to the • CARIFORUM centres of expertise ways to facilitate trade and reduce unnec- changing trading environment. for the assessment of goods for the essary administrative requirements. Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union. 5
  • 6. Title 2: Investment, Services & E-Commerce This title contains comprehensive rules and regulatory principles • The EU liberalized more than 90% of its services sectors and for services and investment including national treatment and all modes of supply. most favoured nation treatment. Both sides agreed to cooperate CARIFORUM states scheduled 50-75% of service sectors in on e-commerce and not to charge customs duties on electroni- order to facilitate investment and the transfer of technology. cally delivered products. It also contains cooperation provisions The main new areas of market opening by CF include: to develop and improve the CARIFORUM services sector. Exclu- • Business services sions from coverage are: audio-visual services; maritime cabo- • Computer and computer related services tage; arms and munitions; some air services, nuclear materials. • Research and Development • Environmental services ChAPtER 2 • Management consultancy COMMERCIAL PREsENCE • Maritime Transport • Entertainment The EPA contains the standard rules on investment such as • Tourism national treatment and MFN but it also includes provisions to safeguard the public interest. It requires that governments take ChAPtER 4 measures to ensure that investors safeguard the environment tEMPORARy PREsENCE OF NAtURAL and maintain high labour and occupational health and safety PERsONs FOR BUsINEss PURPOsE standards. And governments are bound not to lower standards to attract investment. Furthermore, they are required to take The EPA has clearer rules for the temporary movement of measures that forbid investors from engaging in corruption of natural persons (mode 4 in GATS jargon) than the WTO public officials to obtain concessions or favours. because it introduces specific categories of service suppliers that can gain entry into the markets of either Party. (See ChAPtER 3 Table). The EU’s commitments on the Movement of Natural CROss BORDER sUPPLy OF sERVICEs Persons in the EPA are significantly greater than their GATS commitments and conditional services offer in the Doha This chapter contains similar rules on national treatment and Round thereby granting better treatment to Caribbean most favoured nation treatment and addresses the access which suppliers. As expected, CARIFORUM made significantly CARIFORUM and Europe will provide to each other in services less commitments in mode 4 and mainly for intra-corpo- which are traded across their borders. rate transfers. 6 Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
  • 7. highlights Category of Person Main Criteria Length of stay Allowed (i) Key personnel, which includes: Business visitors Persons responsible for setting up a 90 days per calendar year commercial presence and paid by a source outside of the host territory. intra-corporate transfers Persons employed by a company in the up to 3 years - managers sending country at least a year before entry - Specialists to the host country to work within a partner company there. (ii) Graduate trainees university graduates, employed by a up to 1 year company for at least a year and entering either Party for career development or training in a branch or parent company. (iii) Business services sellers Persons entering to negotiate a sale or an 90 days per year agreement but who receive remuneration from a source outside of a Party and do not make direct sales. (iv) Contractual Service Suppliers (CSS). Professionals with 3 years experience up to 6 months per year employed by a company in the sending country, which does not have a presence in the other party but has a service contract with a client in the other party. (v) independent Professionals (iP) Self-employed professionals with 6 years up to 6 months per year experience and service contract. (vi) Short Term Visitors for Business Persons that are not selling services can up to 90 days per year Purpose enter either Party to perform a range of activities such as: research and design, marketing research, training, trade fairs and exhibitions, sales, purchasing and tourism The EU opened 29 sectors to allow that may enter the EU. There is also an to CARIFORUM and Europe in: Computing professional employees of CARIFORUM innovative Protocol on Cultural Coopera- services; Courier services; Telecommuni- firms referred to as “contractual service tion to complement CARIFORUM market cations; Financial services and Tourism. suppliers” (CSS) to enter the EU to supply access in EU Recreational services markets The chapter also provides for development services for up to 6 months in a year. This and to facilitate greater cooperation in support to: includes new areas such as entertainment, the development of cultural industries. It • Develop the capacity of CARIFORUM fashion model, chef de cuisine services, also provides for co-produced audiovisual firms which do not need university degrees. works to be treated as domestic content in • Develop sectoral standards and regu- Eleven (11) sectors have been opened the EU and CARIFORUM. latory regimes up to allow self-employed CARIFORUM • Build human resources within professionals to enter the EU to supply ChAPtER 5 CARIFORUM through training services for up to 6 months. There are sECtORAL RULEs • Develop equivalence of CARIFORUM some restrictions in the newer EU member A regulatory framework is outlined for key skills and Mutual Recognition of states but no limits on the number of CSS sectors of particular development interest qualifications Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union. 7
  • 8. Title 3: Current Payments & Capital Movement CARIFORUM and Europe have agreed not for no more than six months in the event to impose restrictions on the free move- that current payments and capital move- ment of capital related to direct invest- ment cause or threaten to cause difficulties ments. They have the right to implement with the operation of monetary policy or preventative or precautionary measures exchange rate policy. Title 4: Trade-Related Issues These provisions are intended to complement sharing information etc) in the investigation research and development, and participation and support the EPA’s economic and sustainable of alleged anti-competitive practices. in joint ventures. The intellectual property development focus by improvements in areas provisions aim to help create a suitable that affect quality of life and competitiveness. ChAPtER 2 legislative and administrative environment INNOVAtION AND INtELLECtUAL which will provide protection of intellectual ChAPtER 1 PROPERty property. CARIFORUM and Europe agreed COMPEtItION to adequately implement their obligations These provisions ensure that competition is The aim is to help create an environment that under agreements which address intellectual free from distortion and is fair. By so doing the fosters creativity and innovation within the CARI- property to which they may be signatory, interest of both consumers and businesses FORUM States. The creation of new products, such as the WTO TRIPS Agreement. especially small business will be protected. marketing techniques and business practices can • CARIFORUM LDCs are not obligated to There are rules against anti-competitive busi- improve economic growth and development. apply the provisions under the Intellectual ness practices such as the abuse of market Property section until 2014; power and dominance, and a commitment to The EPA seeks to facilitate the develop- • There will be support to develop and establish legislation to prevent such practices ment of CARIFORUM innovation systems enforce the protection of intellectual by firms. There are also provisions allowing to enhance the competitiveness of CARI- property, including geographical indica- the Parties, if they so desire, to cooperate (by FORUM firms through technology transfer, tions and traditional knowledge. 8 Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
  • 9. ChAPtER 3 • These provisions are subject to dispute PUBLIC PROCUREMENt settlement procedures only after all stages of a three stage dispute avoidance The Public Procurement chapter sets out process have been completed. Development Funding comprehensive rules governing the transpar- ency of procurement activities of the Parties. ChAPtER 6 funding for the implementation of the Obligations address all aspects of the procure- PERsONAL DAtA PROtECtION EPa will emanate from a variety of ment process including the publication of sources. Principal among these are relevant national laws and regulations, The principles and general rules established the CarifOrum regional indicative publication of procurement notices, as well under these provisions are intended to Programme (CriP), National indicative as equal and timely access by suppliers to establish a legal regime which allows for the Programmes (NiPs), the Eu member relevant documentation and other pertinent personal data of CARIFORUM and EC citi- States’ aid for Trade (afT) contributions information. However, the provisions do not zens and residents to be protected during data and the Seventh framework Programme confer rights of access to the procurement processing operations. (fP7). Both the CriP and NiPs are markets of the Parties. Governments are there- funded from the EC through the fore free to open or restrict, as the case may • Commitment to establish regulatory European Development fund. The 10th be, their public procurement opportunities, in and legal regimes which are designed to CriP has an allocation of €165 million accordance with their own national laws. facilitate the collection and processing of which €70 million is reserved for of personal data especially with regard direct EPa implementation. The CriP is ChAPtER 4 to services based on data transfer whist complemented by NiPs – a number of ENVIRONMENt ensuring the protection of privacy of which entail funding supportive of EPa customers and transparency. implementation. for example, the €289 These provisions are designed to assist the • Financial and non-financial support to million NiP for the Dominican republic prevention of environmental degradation as a develop legal and regulatory regimes in focuses on enhancing competitiveness result of trade. CARIFORUM. while that for a major share of the €80 million Jamaican NiP targets trade highlights development. These envelopes of • Provisions to prevent the degradation of financial assistance to CarifOrum are the environment and to foster sustainable additional to current EC funding of the development; adjustment in major Caribbean industries • Right of CARIFORUM and Europe to such as sugar, banana, rum and rice. regulate environmental protection in accordance with their own sustainable development priorities but in a manner that does not cause arbitrary or unjustifi- able discrimination against each other; • These obligations are subject to dispute settlement procedures only after all stages of a three stage dispute avoidance process have been completed. ChAPtER 5 sOCIAL AsPECts These provisions are indicative of the Parties acknowledgment of the need to pursue trade and the benefits of trade while upholding international labour standards. • Reaffirmed commitment to ILO labour rights and standards; • Prevention of the use of labour standards for protectionist trade purposes; Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union. 9
  • 10. Part III – Dispute Avoidance and Settlement These provisions are designed to avoid and settle disputes that breach of the EPA. may arise between the EC and its member states and the CARI- • Europe must exercise restraint in imposing such sanctions FORUM states and in seeking trade compensation from the CARIFORUM States. There is no corresponding CARIFORUM obligation. ChAPtER 1 ARBItRAtION PROCEDURE ChAPtER 3 COMMON PROVIsIONs • Dispute resolution is facilitated within three tiers • Consultation • Dispute settlement provisions of the EPA are without • Mediation prejudice to any action in the WTO framework, including • Arbitration dispute settlement action; ChAPtER 2 • Where the EC Party or a CARIFORUM State has started the COMPLIANCE dispute settlement process with regard to a particular issue under the Dispute settlement proceedings of either the EPA • In the event that the EC Party is successful in a dispute, or the WTO, that Party may not start new dispute settlement sanctions can only be imposed on the individual proceedings in another forum until the first proceeding has CARIFORUM State or States which have been found to be in been determined. Part IV – General Exceptions These provisions stipulate the circumstances in which CARI- mentation of national (or as the may be, regional) measures to FORUM or Europe may derogate from the rules under the EPA. protect: public morals; public security, human, plant or animal Such derogations would only be permitted if they are grounded health and life. The EPA does not prevent the implementation of factually on one or more of several specified matters and do measures by CARIFORUM or Europe to prevent tax evasion or not constitute disguised restrictions on trade or are applied in tax avoidance. a discriminatory matter. The EPA does not prevent the imple- 10 Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.
  • 11. Part V – Institutional Provisions These provisions facilitate the establishment of institutions in an expeditious manner and that the development vested with specific responsibilities essential to ensuring that the dimension of the EPA is fulfilled. objectives of the EPA are met. They are modelled on the structure of Cotonou Institutional Provisions and present a structure of The CARIFORUM-EC Parliamentary Committee governance with which the CARIFORUM States are familiar. • Comprised of representatives from the European They are as follows: Parliament and the legislatures of the CARIFORUM States The Joint CARIFORUM-EC Council: • Facilitates meeting and exchange of views of these • Highest institution representatives on the implementation of the EPA • Will meet at Ministerial level at regular intervals not exceeding two years The CARIFORUM-EC Consultative Committee • Is vested with responsibility to supervise the imple- • Designed for the engagement of civil society in the mentation of the EPA EPA implementation process. • May take decisions concerning any aspect of the agree- • Composition to be determined by the Joint ment as jointly agreed by CARIFORUM and the EC. CARIFORUM-EC Council The CARIFORUM-EC Trade and Development Committee None of these Institutions involve supra-nationality or the • Second highest institution ceding of sovereignty of the CARIFORUM States or the EU. • Assists the Joint CARIFORUM-EC Council Governments on both sides have only jointly agreed to delegate • Vested with specific responsibilities vital to ensuring authority on issues relating specifically to the implementation that all matters affecting the partnership are resolved of the EPA to these institutions. Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union. 11
  • 12. Part VI – General and Final Provisions ABOUt Us Our Vision Caribbean Export is a catalyst for regional economic prosperity through strategic interventions on trade development and investment promotion Our Mission To increase the competitiveness of Caribbean countries by providing quality trade development and investment promotion services through effective programme execution These provisions express final arrangements to Countries (LDCs) of CARICOM and the and strategic alliances. be facilitated. Dominican Republic on all other goods; Key Result Areas and goals • Market access and trade as covered in all areas Fostering an enabling • From the signature of the EPA CARIFORUM under the Agreement are facilitated between environment – for trade and states are obliged to extend to each other any the Outermost Regions of Europe. investment within the region advantage that is extended to Europe: • Provides for the possibility of revising the EPA in through regional integration, cooperation and advocacy • With immediate effect between CARICOM order to: initiatives designed to position and the Dominican Republic on all duties • include the Overseas Countries and the region more effectively in the attracting zero rated duty; Territories (OCTs) associated with the world economy. • Within 1 year between More Developed European Community; Enhancing Competitiveness – Countries (MDCs) of CARICOM and the • adjust to the pending expiration of the increase the competitiveness of Dominican Republic on all other goods; Cotonou Agreement in 2020; firms in CarifOrum countries in selected sectors through • Within 2 years between Less Developed • broaden and supplement the scope of the EPA. investment, management and product development, market expansion and export diversification. Promoting Investment – Promote this tradewins is a joint publication of the Caribbean Export Development Agency the Caribbean region as a prime destination for intra and extra- (Caribbean Export) and the Caribbean Regional Negotiating Machinery (CRNM). regional investment. Caribbean Export Development Agency Caribbean Regional Negotiating Strengthening Institutional head Office sub Regional Office Machinery (CRNM) Capacity and Networking – mutual Building, Hastings main road, Calle Carlos Lora No. 9 3rd floor, the mutual Building Enhance the capacity of public Christ Church, BB15154 Ensanche Los restauradores Hastings main road, Hastings, and private sector BSOs, Mailing Address Christ Church Santo Domingo particularly sector associations, Barbados P.O. Box 34B, Brittons Hill Post Office, DOmiNiCaN rEPuBLiC trade promotion organisations Tel: (246) 430-1670 St. michael, BB14000, BarBaDOS Tel: +1 (809) 531-2411 and investment promotion Tel: +1(246) 436-0578 fax: +1 (809) 473-7532 fax: (246) 228-9528 agencies, and support the development of vibrant fax: +1(246) 436-9999 E-mail: c.export@codetel.net.do Caribbean business networks to E-mail: info@carib-export.com improve services to clients. Website: www.carib-export.com We are very interested in your feedback. Please email your comments to tradewins@carib-export.com. all material copyright © 2009 Caribbean Export. 12 Tradewins is a publication of the Caribbean Export Development Agency (Caribbean Export) © 2009 Tradewins is made possible through the kind support of the European Union.