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RECOMMENDATION (11667/2023 – C90466/2023 – 2023/0259(NLE))

On the draft Council decision on the conclusion of the Interim Agreement on Trade between the European Union and the Republic of Chile

A-9-2024-0011

Committee on International Trade · Rapporteur: Samira Rafaela

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The Committee on International Trade recommends that Parliament give its consent to the conclusion of the Interim Agreement on Trade between the European Union and Chile. The agreement covers only the trade and investment parts of the wider Advanced Framework Agreement that fall within the EU's exclusive competence, and will expire automatically once that framework agreement enters into force. It liberalises most remaining tariffs, protects geographical indications, and includes chapters on investment and services, energy and raw materials, trade and gender, and trade and sustainable development. The rapporteur says the deal will strengthen EU-Chile relations, support a fair green transition and defend rules-based trade.

Committee position. The Committee on International Trade recommends that Parliament give its consent to the conclusion of the Interim Agreement on Trade between the EU and Chile.

Key points

  1. Parliament gives its consent to the conclusion of the Interim Agreement on Trade between the European Union and the Republic of Chile.
  2. The agreement contains only the trade and investment provisions of the Advanced Framework Agreement that fall within the EU's exclusive competence, and is ratified by the EU alone.
  3. Once the Advanced Framework Agreement enters into force, the Interim Agreement on Trade will automatically expire.
  4. The agreement liberalises 96 percent of the agricultural tariff lines not yet liberalised on Chile's side and 66 percent on the EU side, over a maximum of seven years.
  5. Exclusions continue for sugar on both sides and for bananas and rice on the EU side, and Chilean fruit and vegetables remain subject to the EU entry price system.
  6. The EU provides increased duty-free quotas for poultry meat, pork, sheep meat, beef, garlic and canned fish from Chile, and opens new quotas for olive oil, fruit preparations and other items.
  7. The agreement protects 216 EU geographical indications in Chile and 18 Chilean geographical indications in the EU.
  8. Chapters on investment and services give European and Chilean investors equal treatment and safeguard the right of public authorities to regulate in the public interest, including public services such as education, healthcare and water.
  9. A stand-alone chapter on trade and gender, the first in an EU trade agreement, sets commitments on gender equality.
  10. The chapter on energy and raw materials prohibits export and import monopolies and dual pricing, while allowing Chile limited policy space to set a lower domestic price.
  11. A chapter on Trade and Sustainable Development contains binding commitments on social, labour and environmental matters, and a joint statement commits the parties to review the agreement to align it with the most up-to-date sustainability standards.
  12. The rapporteur recommends giving consent, saying the agreement will strengthen EU-Chile relations and support fair, sustainable and values-based trade.

Who is affected

  • EU and Chilean exporters and importers of agricultural and industrial goods, who face changed tariffs and quotas.
  • EU and Chilean investors, who gain equal treatment when establishing and operating businesses.
  • Producers of products with protected geographical indications in the EU and Chile.
  • Workers, indigenous peoples and the environment in both parties, covered by the trade and sustainable development commitments.

Figures and deadlines

  • 96 percent of agricultural tariff lines not yet liberalised on Chile's side
  • 66 percent of agricultural tariff lines not yet liberalised on the EU side
  • over a maximum of seven years
  • over 95 percent of bilateral trade in goods being duty free
  • 216 geographical indications from the EU protected in Chile
  • 18 geographical indications from Chile protected in the EU
  • EU-Chile bilateral trade grew by 142 percent between 2002 and 2021

Legal basis: Article 91(1), Article 100(2), Article 207(4), first subparagraph, Article 218(6), second subparagraph, point (a)(v) and Article 218(7) of the Treaty on the Functioning of the European Union