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DRAFT REPORT (2023/2001(INI))

On the implementation of the EU-Canada Comprehensive Economic and Trade Agreement (CETA)

INTA-PR-753671

Committee on International Trade · Rapporteur: Javier Moreno Sánchez

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The draft report reviews how the EU-Canada Comprehensive Economic and Trade Agreement (CETA) has been implemented since its provisional application. It finds stronger trade ties, rising preference use and resilient trade flows, but notes gaps in tariff rate quota use, geographical indications enforcement and services trade. It recommends raising awareness of CETA, giving small and medium-sized enterprises (SMEs) tools to use it, fully implementing all provisions, and reviewing the agreement to add a dispute settlement mechanism with sanctions as a last resort. It urges Belgium, Bulgaria, Cyprus, France, Greece, Hungary, Ireland, Italy, Poland and Slovenia to ratify CETA so that investment protection and updates, including a review of the sustainable development chapter, can apply.

Committee position. The rapporteur proposes that Parliament welcome CETA's implementation gains, recommend raising awareness and supporting SMEs, call for full implementation and ratification by ten member states, and ask for a review to add a dispute settlement mechanism with sanctions as a last resort.

Key points

  1. CETA has created stronger trade ties and a stable framework between the EU and Canada, with gains in goods, services and investment, and helps diversify supply chains amid geopolitical uncertainty.
  2. Implementation matters for EU access to critical raw materials needed for the green transition and technological ambitions.
  3. Business and civil society stakeholders are largely content with progress, including work in CETA committees, the regulatory cooperation forum and the domestic advisory group.
  4. The EU almost fully uses its tariff rate quotas, while Canada uses only a very small part of its beef quota; challenges remain on geographical indications enforcement and cheese quota management.
  5. Preference utilisation can improve; it is higher for SMEs than large companies and higher in agri-food than manufacturing, with EU import utilisation at 65% in 2021 and export utilisation at 58%.
  6. Parliament recommends raising awareness of CETA among stakeholders in both regions and giving SMEs all necessary tools to trade and invest under the agreement.
  7. It calls for full implementation of all CETA provisions and for Belgium, Bulgaria, Cyprus, France, Greece, Hungary, Ireland, Italy, Poland and Slovenia to ratify the agreement.
  8. It asks the parties to review CETA to introduce a dispute settlement mechanism, including sanctions as a last resort for serious breaches.
  9. It welcomes the recommendation on Trade and Gender and the action plan, and encourages the Commission to publish more accessible gender-disaggregated data on the agreement's use.
  10. It welcomes cooperation on trade and climate action and the 27% growth in environmental goods trade since provisional application began.
  11. It welcomes monitoring by domestic advisory groups and the Civil Society Forum, and insists on effective implementation of trade and sustainable development commitments, with an ex post evaluation in 2024.
  12. It welcomes efforts to facilitate public procurement access, such as Canada's Single Point of Access, and says EU suppliers could do more in infrastructure and provincial and municipal contracts.

Who is affected

  • EU and Canadian businesses, especially SMEs, which are encouraged to use CETA preferences and are offered support tools.
  • EU exporters of cheese and beef, affected by Canadian tariff rate quota management and EU import quota use.
  • EU holders of geographical indications, who need stronger enforcement in Canada.
  • Belgium, Bulgaria, Cyprus, France, Greece, Hungary, Ireland, Italy, Poland and Slovenia, urged to ratify CETA.
  • Civil society, including environmental, labour, academic and indigenous representatives, involved through domestic advisory groups and the Civil Society Forum.

Figures and deadlines

  • Trade in goods between the EU and Canada increased by 53% between 2017 and 2022.
  • EU-Canada trade in services increased by 46%.
  • EU goods exports to Canada increased by 47% during the first five years of provisional application.
  • Jobs supported by EU exports to Canada rose from 624 000 in 2017 to more than 700 000 in 2021.
  • Preference utilisation rates of EU imports from Canada stood at 65% in 2021 compared to 52% in 2018.
  • Preference utilisation rates of EU exports reached 58% in 2021 compared to 40% in 2018.
  • The tariff rate quota utilisation rate for beef and veal imports to the EU was only 3% in 2021.
  • The tariff rate quota utilisation rate stands at 98% for EU cheese exports on average.