Title
COMPREHENSIVE ECONOMIC AND TRADE AGREEMENT (CETA) between Canada and the European Union and its Member States
Preamble
CANADA,
of the one part, and
THE EUROPEAN UNION,
THE KINGDOM OF BELGIUM,
THE REPUBLIC OF BULGARIA,
THE CZECH REPUBLIC,
THE KINGDOM OF DENMARK,
THE FEDERAL REPUBLIC OF GERMANY,
THE REPUBLIC OF ESTONIA,
IRELAND,
THE HELLENIC REPUBLIC,
THE KINGDOM OF SPAIN,
THE FRENCH REPUBLIC,
THE REPUBLIC OF CROATIA,
THE ITALIAN REPUBLIC,
THE REPUBLIC OF CYPRUS,
THE REPUBLIC OF LATVIA,
THE REPUBLIC OF LITHUANIA,
THE GRAND DUCHY OF LUXEMBOURG,
HUNGARY,
THE REPUBLIC OF MALTA,
THE KINGDOM OF THE NETHERLANDS,
THE REPUBLIC OF AUSTRIA,
THE REPUBLIC OF POLAND,
THE PORTUGUESE REPUBLIC,
ROMANIA,
THE REPUBLIC OF SLOVENIA,
THE SLOVAK REPUBLIC,
THE REPUBLIC OF FINLAND,
THE KINGDOM OF SWEDEN,
and
THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND, of the other part,
hereafter jointly referred to as the "Parties",
resolve to:
FURTHER strengthen their close economic relationship and build upon their respective rights and obligations under the Marrakesh Agreement Establishing the World Trade Organization, done on 15 April 1994, and other multilateral and bilateral instruments of cooperation;
CREATE an expanded and secure market for their goods and services through the reduction or elimination of barriers to trade and investment;
ESTABLISH clear, transparent, predictable and mutually-advantageous rules to govern their trade and investment; AND,
REAFFIRMING their strong attachment to democracy and to fundamental rights as laid down in The Universal Declaration of Human Rights, done at Paris on 10 December 1948, and sharing the view that the proliferation of weapons of mass destruction poses a major threat to international security;
RECOGNISING the importance of international security, democracy, human rights and the rule of law for the development of international trade and economic cooperation;
RECOGNISING that the provisions of this Agreement preserve the right of the Parties to regulate within their territories and the Parties' flexibility to achieve legitimate policy objectives, such as public health, safety, environment, public morals and the promotion and protection of cultural diversity;
AFFIRMING their commitments as parties to the UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions, done at Paris on 20 October 2005, and recognising that states have the right to preserve, develop and implement their cultural policies, to support their cultural industries for the purpose of strengthening the diversity of cultural expressions, and to preserve their cultural identity, including through the use of regulatory measures and financial support;
RECOGNISING that the provisions of this Agreement protect investments and investors with respect to their investments, and are intended to stimulate mutually-beneficial business activity, without undermining the right of the Parties to regulate in the public interest within their territories;
REAFFIRMING their commitment to promote sustainable development and the development of international trade in such a way as to contribute to sustainable development in its economic, social and environmental dimensions;
ENCOURAGING enterprises operating within their territory or subject to their jurisdiction to respect internationally recognised guidelines and principles of corporate social responsibility, including the OECD Guidelines for Multinational Enterprises, and to pursue best practices of responsible business conduct;
IMPLEMENTING this Agreement in a manner consistent with the enforcement of their respective labour and environmen- tal laws and that enhances their levels of labour and environmental protection, and building upon their international commitments on labour and environmental matters;
RECOGNISING the strong link between innovation and trade, and the importance of innovation to future economic growth, and affirming their commitment to encourage the expansion of cooperation in the area of innovation, as well as the related areas of research and development and science and technology, and to promote the involvement of relevant public and private sector entities;
HAVE AGREED AS FOLLOWS:
Body
Chapter ONE. General Definitions and Initial Provisions
Section A. General Definitions
Article 1.1. Definitions of General Application
For the purposes of this Agreement and unless otherwise specified:
administrative ruling of general application means an administrative ruling or interpretation that applies to all persons and fact situations that fall generally within its ambit and that establishes a norm of conduct but does not include:
(a) a determination or ruling made in an administrative or quasi-judicial proceeding that applies to a particular person, good or service of the other Party in a specific case; or
(b) a ruling that adjudicates with respect to a particular act or practice; Agreement on Agriculture means the Agreement on Agriculture, contained in Annex 1A to the WTO Agreement; agricultural good means a product listed in Annex 1 to the Agreement on Agriculture;
Anti-dumping Agreement means the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, contained in Annex 1A to the WTO Agreement;
CETA contact points means the contact points established under Article 26.5 (CETA contact points); CETA Joint Committee means the CETA Joint Committee established under Article 26.1 (The CETA Joint Committee);
CPC means the provisional Central Product Classification as set out in Statistical Office of the United Nations, Statistical Papers, Series M, N° 77, CPC prov, 1991;
cultural industries means persons engaged in:
(a) the publication, distribution or sale of books, magazines, periodicals or newspapers in print or machine-readable form, except when printing or typesetting any of the foregoing is the only activity;
(b) the production, distribution, sale or exhibition of film or video recordings; (c) the production, distribution, sale or exhibition of audio or video music recordings; (d) the publication, distribution or sale of music in print or machine-readable form; or
(e) radio-communications in which the transmissions are intended for direct reception by the general public, and all radio, television and cable broadcasting undertakings and all satellite programming and broadcast network services;
customs duty means a duty or charge of any kind imposed on or in connection with the importation of a good, including a form of surtax or surcharge imposed on or in connection with that importation, but does not include:
(a) a charge equivalent to an internal tax imposed consistently with Article 2.3 (National treatment);
(b) a measure applied in accordance with the provisions of Articles VI or XIX of the GATT 1994, the Anti-dumping Agreement, the SCM Agreement, the Safeguards Agreement, or Article 22 of the DSU; or
(c) a fee or other charge imposed consistently with Article VIII of the GATT 1994;
Customs Valuation Agreement means the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, contained in Annex 1A to the WTO Agreement;
days means calendar days, including weekends and holidays;
DSU means the Understanding on Rules and Procedures Governing the Settlement of Disputes, contained in Annex 2 to the WTO Agreement;
enterprise means an entity constituted or organised under applicable law, whether or not for profit, and whether privately or governmentally owned or controlled, including a corporation, trust, partnership, sole proprietorship, joint venture or other association;
existing means in effect on the date of entry into force of this Agreement;
GATS means the General Agreement on Trade in Services, contained in Annex 1B to the WTO Agreement;
GATT 1994 means the General Agreement on Tariffs and Trade 1994, contained in Annex 1A to the WTO Agreement;
goods of a Party means domestic products as these are understood in the GATT 1994 or such goods as the Parties may decide, and includes originating goods of that Party;
Harmonized System (HS) means the Harmonized Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, Chapter Notes and subheading notes;
heading means a four-digit number or the first four digits of a number used in the nomenclature of the HS;
measure includes a law, regulation, rule, procedure, decision, administrative action, requirement, practice or any other form of measure by a Party;
national means a natural person who is a citizen as defined in Article 1.2, or is a permanent resident of a Party; originating means qualifying under the rules of origin set out in the Protocol on Rules of Origin and Origin Procedures; Parties means, on the one hand, the European Union or its Member States or the European Union and its Member States within their respective areas of competence as derived from the Treaty on European Union and the Treaty on the Functioning of the European Union (hereinafter referred to as the "EU Party"), and on the other hand, Canada;
person means a natural person or an enterprise;
person of a Party means a national or an enterprise of a Party;
preferential tariff treatment means the application of the duty rate under this Agreement to an originating good pursuant to the tariff elimination schedule;
Safeguards Agreement means the Agreement on Safeguards, contained in Annex 1A to the WTO Agreement; sanitary or phytosanitary measure means a measure referred to in Annex A, paragraph 1 of the SPS Agreement;
SCM Agreement means the Agreement on Subsidies and Countervailing Measures, contained in Annex 1A to the WTO Agreement;
service supplier means a person that supplies or seeks to supply a service; Pp PP! pply
SPS Agreement means the Agreement on the Application of Sanitary and Phytosanitary Measures, contained in Annex 1A to the WTO Agreement;
state enterprise means an enterprise that is owned or controlled by a Party;
subheading means a six-digit number or the first six digits of a number used in the nomenclature of the HS;
tariff classification means the classification of a good or material under a chapter, heading or subheading of the HS; tariff elimination schedule means Annex 2-A (Cariff elimination);
TBT Agreement means the Agreement on Technical Barriers to Trade, contained in Annex 1A to the WTO Agreement;
territory means the territory where this Agreement applies as set out under Article 1.3;
third country means a country or territory outside the geographic scope of application of this Agreement;
TRIPS Agreement means the Agreement on Trade-Related Aspects of Intellectual Property Rights, contained in Annex 1C to the WTO Agreement;
Vienna Convention on the Law of Treaties means the Vienna Convention on the Law of Treaties, done at Vienna on 23 May 1969;
WTO means the World Trade Organization; and
WTO Agreement means the Marrakesh Agreement Establishing the World Trade Organization, done on 15 April 1994.
Article 1.2. Party-specific Definitions
For the Purposes of this Agreement, unless otherwise specified:
citizen means:
(a) for Canada, a natural person who is a citizen of Canada under Canadian legislation;
(b) for the EU Party, a natural person holding the nationality of a Member State; and central government means:
(a) for Canada, the Government of Canada; and
(b) for the EU Party, the European Union or the national governments of its Member States;
Article 1.3. Geographical Scope of Application
Unless otherwise specified, this Agreement applies:
(a) for Canada, to:
(i) the land territory, air space, internal waters, and territorial sea of Canada;
(ii) the exclusive economic zone of Canada, as determined by its domestic law, consistent with Part V of the United Nations Convention on the Law of the Sea, done at Montego Bay on 10 December 1982 (UNCLOS); and,
(iii) the continental shelf of Canada, as determined by its domestic law, consistent with Part VI of UNCLOS;
(b) for the European Union, to the territories in which the Treaty on European Union and the Treaty on the Functioning of the European Union are applied and under the conditions laid down in those Treaties. As regards the provisions concerning the tariff treatment of goods, this Agreement shall also apply to the areas of the European Union customs territory not covered by the first sentence of this subparagraph.
Section B. Initial Provisions
Article 1.4. Establishment of a Free Trade Area
The Parties hereby establish a free trade area in conformity with Article XXIV of GATT 1994 and Article V of the GATS.
Article 1.5. Relation to the WTO Agreement and other Agreements
The Parties affirm their rights and obligations with respect to each other under the WTO Agreement and other agreements to which they are party.
Article 1.6. Reference to other Agreements
When this Agreement refers to or incorporates by reference other agreements or legal instruments in whole or in part, those references include:
(a) related annexes, protocols, footnotes, interpretative notes and explanatory notes; and
(b) successor agreements to which the Parties are party or amendments that are binding on the Parties, except where the reference affirms existing rights.
Article 1.7. Reference to Laws
When this Agreement refers to laws, either generally or by reference to a specific statute, regulation or directive, the reference is to the laws, as they may be amended, unless otherwise indicated.
Article 1.8. Extent of Obligations
1. Each Party is fully responsible for the observance of all provisions of this Agreement.
2. Each Party shall ensure that all necessary measures are taken in order to give effect to the provisions of this Agreement, including their observance at all levels of government.
Article 1.9. Rights and Obligations Relating to Water
1. The Parties recognise that water in its natural state, including water in lakes, rivers, reservoirs, aquifers and water basins, is not a good or a product. Therefore, only Chapters Twenty-Two (Trade and Sustainable Development) and Twenty-Four (Trade and Environment) apply to such water.
2. Each Party has the right to protect and preserve its natural water resources. Nothing in this Agreement obliges a Party to permit the commercial use of water for any purpose, including its withdrawal, extraction or diversion for export in bulk.
3. If a Party permits the commercial use of a specific water source, it shall do so in a manner consistent with this Agreement.
Article 1.10. Persons Exercising Delegated Governmental Authority
Unless otherwise specified in this Agreement, each Party shall ensure that a person that has been delegated regulatory, administrative or other governmental authority by a Party, at any level of government, acts in accordance with the Party's obligations as set out under this Agreement in the exercise of that authority.
Chapter TWO. National Treatment and Market Access for Goods
Article 2.1. Objective
The Parties shall progressively liberalise trade in goods in accordance with the provisions of this Agreement over a transitional period starting from the entry into force of this Agreement.
Article 2.2. Scope
This Chapter applies to trade in goods of a Party, as defined in Chapter 1 (General Definitions and Initial Provisions), except as otherwise provided in this Agreement.
Article 2.3. National Treatment
1. Each Party shall accord national treatment to the goods of the other Party in accordance with Article III of the GATT 1994. To this end Article III of the GATT 1994 is incorporated into and made part of this Agreement.
2. Paragraph 1 means, with respect to a government in Canada other than at the federal level, or a government of or in a Member State of the European Union, treatment no less favourable than that accorded by that government to like, directly competitive or substitutable goods of Canada or the Member State, respectively.
3. This Article does not apply to a measure, including a measure's continuation, prompt renewal or amendment, in respect of Canadian excise duties on absolute alcohol, as listed under tariff item 2207 10 90 in Canada's Schedule of Concessions (Schedule V) annexed to the Marrakesh Protocol to the General Agreement on Tariffs and Trade 1994, done on 15 April 1994 (the "Marrakesh Protocol"), used in manufacturing under provisions of the Excise Act, 2001, S.C. 2002, c. 22.
Article 2.4. Reduction and Elimination of Customs Duties on Imports
1. Each Party shall reduce or eliminate customs duties on goods originating in either Party in accordance with the tariff elimination schedules in Annex 2-A. For the purposes of this Chapter, "originating" means originating in either Party under the rules of origin set out in the Protocol on rules of origin and origin procedures.
2. For each good, the base rate of customs duties to which the successive reductions under paragraph 1 are to be applied shall be that specified in Annex 2-A.
3. For goods that are subject to tariff preferences as listed in a Party's tariff elimination schedule in Annex 2-A, each Party shall apply to originating goods of the other Party the lesser of the customs duties resulting from a comparison between the rate calculated in accordance with that Party's Schedule and its applied Most-Favoured-Nation ("MFN") rate.
4. On the request of a Party, the Parties may consult to consider accelerating and broadening the scope of the elimination of customs duties on imports between the Parties. A decision of the CETA Joint Committee on the acceleration or elimination of a customs duty on a good shall supersede any duty rate or staging category determined pursuant to the Parties' Schedules in Annex 2-A for that good when approved by each Party in accordance with its applicable legal procedures.
Article 2.5. Restriction on Duty Drawback, Duty Deferral and Duty Suspension Programs
1. Subject to paragraphs 2 and 3, a Party shall not refund, defer or suspend a customs duty paid or payable on a non-originating good imported into its territory on the express condition that the good, or an identical, equivalent or similar substitute, is used as a material in the production of another good that is subsequently exported to the territory of the other Party under preferential tariff treatment pursuant to this Agreement.
2. Paragraph 1 does not apply to a Party's regime of tariff reduction, suspension or remission, either permanent or temporary, if the reduction, suspension or remission is not expressly conditioned on the exportation of a good.
3. Paragraph 1 does not apply until three years after the date of entry into force of this Agreement.