European Parliament approves EU-Vietnam trade agreement

/ Global Compliance Solutions Group LLC/

On February 12, 2020 the European Parliament approved the EU-Vietnam trade and investment agreements (the “Agreement”).(1) The Agreement is set to enter into force in 2020 after Vietnam completes their ratification process. It is expected that the Vietnamese National Assembly will ratify the Agreement in the summer of 2020. All EU Member States must also ratify the Agreement.

Once fully implemented the Agreement will eliminate most tariffs on goods traded between EU member states and Vietnam. The Agreement represents the most comprehensive trade agreement between the EU and a developing nation. Vietnam’s developing nation status was taken into consideration and is why they were given a longer period of 10-years to eliminate duties related to many products. Some key points for the Agreement(2) include:

  • EU pharmaceuticals, chemicals, and machinery will have free import conditions into Vietnam as of entry into force;

  • The Agreement contains provisions addressing non-tariff barriers in the automotive sector; and

  • EU companies will be able to participate on an equal footing with Vietnamese companies in bids for government authorities and state-owned enterprises.

For more information:

  • Visit the European Commission’s EU-Vietnam trade agreement web page(3) at: https://ec.europa.eu/trade/policy/in-focus/eu-vietnam-agreement/

  • Contact the professionals at GCSG: http://www.globalcompliancesg.com/contact

References

  1. European Commission - Press corner: “Commission welcomes European Parliament’s approval of EU-Vietnam trade and investment agreements” - 12 February 2020

  2. European Commission - “EU-Vietnam trade and investment agreements” text

  3. European Commission - “EU-Vietnam Agreement” web page

EU - Japan trade agreement effective on Feb 1, 2019

/ Global Compliance Solutions Group LLC/

On February 1, 2019 the European Union (EU) - Japan Economic Partnership Agreement (EPA) becomes effective. The EPA creates a trading area that covers 600 million people and close to a third of global gross domestic product.

“The EPA is the biggest trade agreement concluded to date by the EU. 99% of the tariffs applied on EU exports to Japan which currently amount to €1 billion, will be removed.”(1)

The EU exports more than €58 billion in goods and €28 billion in services to Japan each year.(2)

References

  1. European Council Press Release - “EU-Japan trade agreement will enter into force on 1 February 2019” - 21/12/2018

  2. European Commission - “EU-Japan Economic Partnership Agreement” - Official Page

  3. European Commission - “Fact sheets about the agreement” - News archive

US Trade Representative Issues Trade Fact Sheet on US-MX Trade Agreement

/ Global Compliance Solutions Group LLC/

The Office of the United States Trade Representative (USTR) recently published a fact sheet detailing the key components of the recently agreed upon US-Mexico Trade Agreement.  Some of the key changes proposed in the rule include:

  • Auto sector: At least 75% of a vehicle must have been built in either the US or Mexico in order for the vehicle to sell in the US without tariffs.  The original NAFTA agreement only required 62.5%.
  • Intellectual property: The agreement extends US copyright protection into Mexico and strengthens the patent protections in the pharmaceutical and agricultural sectors.  It also addresses digital trade, something that was not covered under NAFTA.
  • Labor and Environmental: The agreement requires companies to "prohibit the importation of goods produced by forced labor, to address violence against workers exercising their labor rights, and to ensure that migrant workers are protected under labor laws.".  It also addresses air quality issues.
  • Duty free limits: The agreement raises the "de minimis" level from $50 to $100 for duty free entry from the US into Mexico for Mexican citizens.  U.S. citizens are allowed to import up to $800 worth of goods duty free.
  • Sunset Clause: The pact, if agreed upon would run for 16 years.  After 6 years both sides would met and decide if they wanted to renew for another 16 years.      

The deal requires approval from the US Congress before it can become law.  The Administration intends to submit the paperwork to get the process started in Congress as early as Friday.  This timeline potentially gives Canada only a week to sign-on to the deal.  

Click here for the full Fact Sheet.  

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