In this Briefing Paper, Erika Szyszczak, UKTPO Fellow and Professor Emerita of Law at the University of Sussex, offers an in-depth analysis of the Open Strategic Autonomy (OSA) policy. The EU continues to argue for multilateralism and a rules-based international order yet the effect of many of these measures could infringe international law and weaken the already perilous international legal order Read Briefing Paper 76: OPEN STRATEGIC AUTONOMY AS EU TRADE POLICY.

In this Briefing Paper, we look at the European Commission’s recently proposed unilateral measures for European Union trade security. Taken together, the Foreign Subsidies Regulation and the Anti-Coercion Instrument are aimed at enabling the Commission to counteract the distortive impact of ‘third country’ subsidies on EU business competitiveness; as well as to investigate and retaliate against the perceived use of economic coercion by foreign governments against the EU, its Member States and firms. While such policies may be primarily targeted at China, they would de facto apply to all third countries including Russia, the US, and the UK. While both measures would give the Commission wide discretion in their application, the Anti-Coercion Instrument would specifically allow it to bypass the World Trade Organization dispute settlement process and possible wider international law commitments. We conclude that with continuing geopolitical uncertainty for the rules-based global trade environment – compounded by the Covid-19 pandemic and the Russian invasion of Ukraine – the EU treads a careful line between the development of a specialist trade policy and a piecemeal approach in respect of the overarching restraints of Member States, international law commitments and other stakeholders’ fundamental rights. Read Briefing Paper 70: Trade and Security: The [...]

This Briefing Paper analyses the EU’s move towards a more defensive trade policy, which enhances enforcement powers and commits to including sustainable development, environmental and labour protection goals in trade agreements. The paper examines the Current Trade Disputes where the EU has commenced formal action under a Free Trade Agreement – against Algeria, Ukraine, the Southern African Union and South Korea – and discusses the EU’s review and enhancement of International Trade Dispute Mechanisms. Professor Szyszczak concludes that, until the WTO Appellate Structure is operational, the EU is setting the pace for international trade dispute resolution. Read Briefing Paper 55: EU ENFORCEMENT OF INTERNATIONAL TRADE RULES

The Trade and Cooperation Agreement (TCA) between the UK and the EU came into force on the 1st January 2021. This Briefing Paper considers the governance, subsidies and the level playing field provisions. The analysis reveals that much of the area lies outside the normal dispute settlement procedure and in some cases bespoke procedures replace or supplement it.  There are some innovative clauses concerning procedures to deal with imbalances arising from future labour and environmental policies, and the potential for review of the balance of the entire trade heading,  but these are quite unknown quantities and have the capacity to create perpetual wrangling and bad feeling between the UK and the EU. Read Briefing Paper 54: TAKING STOCK OF THE UK-EU TRADE AND COOPERATION AGREEMENT: GOVERNANCE, STATE SUBSIDIES AND THE LEVEL PLAYING FIELD 

State aid is a delicate issue in the current EU-UK trade negotiations. Whilst the EU is seeking dynamic alignment of any set of future UK State aid rules with the EU rules to maintain a ‘Level Playing Field’ (LPF) in areas relating to access to the Internal Market, the UK takes the stance that it would introduce its own regime of subsidy control. The UK prefers to adopt a more relaxed process for international trade based upon the rules in the WTO’s Agreement on Subsidies and Countervailing Measures (ASCM) but relying on WTO rules would not create a robust domestic system of state aid control. To maintain a close trade relationship with the EU, the UK must manoeuvre into a position where it gives effect to a State aid regime equivalent to that maintained by the EU, with an effective and robust independent enforcement process, but the UK has taken a different view. The reaction of the UK Government to the COVID-19 crisis has revealed the need for transparency in the granting of subsidies as well as accountability in procurement and yet the current situation is very opaque. Read Briefing Paper 42: STATE AID: NOT ONLY ABOUT TRADE

Investor-State Dispute Settlement (ISDS) mechanisms have been globally criticised as out-dated and inappropriate fora for the settlement of disputes involving States. Attempted reform is underway at the United Nations Commission on International Trade Law (UNCITRAL) Working Group III, at which the EU is a key player. The role of the EU as a significant moderniser of trade agreements will have implications for the UK in negotiating any future trade deals with the EU. For example, the consequences of the recent Opinion 1/17 on the legality of a new form of court system to handle investor-state disputes in the EU-Canada Agreement (CETA) are significant in analysing how the CJEU was persuaded to reach the conclusion that new judicial fora in international Treaties may be compatible with EU law. The litigation around the modern trade agreements of the EU is a warning signal that conducting trade agreements from scratch with the EU is not painless, with ratification potentially being very prolonged when there are challenges to the agreement at the national and EU level. Read Briefing Paper 30 – Opinion 1/17: Towards A Modern EU Approach to Investor-State Dispute Settlement