Meeting of the Committee on Trade and Sustainable Development
(10-11 December 2020, by videoconference)
Joint Report
The third meeting of the CETA Committee on Trade and Sustainable Development (TSD) took place on 10-11 December 2020 via videoconference. Officials from the EU and Canada reviewed progress on the implementation of the TSD committee work plan, including initiatives under the joint Recommendations on Trade and Gender, and on Trade, Climate and the Paris Agreement, as well as on the TSD Early Review. The Parties provided updates on new policy developments and legislation pertaining to these issues, and discussed further activities for collaboration to advance trade and sustainable development initiatives under CETA. In line with previous TSD meetings, the Committee was joined by the Chairs of the Canadian and the EU Domestic Advisory Groups (DAGs) under CETA and welcomed their feedback and suggestions for collaboration under the CETA TSD chapters, as well as on CETA’s Civil Society Forum (CSF) held on 8 and 9 December (report from the CSF available here).
The Trade and Gender Recommendation
Officials from both sides noted continued good progress in the second year of implementing the CETA Trade and Gender Recommendation, in line with the Trade and Gender Work Plan. They recalled the exchanges and events (summarized in the joint report of 21 September 2020 on “Working together to advance Trade and Gender”, available on the parties’ respective websites) aimed at sharing information on policies, laws and best practices on a range of issues, including supporting women’s entrepreneurship and conducting impact assessments of free trade agreements. It also includes stakeholder engagement activities such as the G7 WE EMPOWER webinar on "Assessing the Impact of Trade Agreements on Women’s Economic Empowerment", and the cooperation in multilateral fora such as the informal working group on trade and women’s economic empowerment at the WTO. Future activities planned for 2021 include trade and responsive standards, gender and smart financing, improving women’s involvement on supply chains, trade and gender and development. Moreover, recalling the exchanges with civil society representatives in the Civil Society Forum the day before, the parties will examine impact of COVID-19 on women entrepreneurs.
Corporate Social Responsibility/Responsible Business conduct (RBC)
In previous years, Parties compared respective approaches to supporting CSR/RBC, and they put their respective representative organisations (CSR Europe and United Nations (UN) Global Compact Network Canada (UNGCNC)) in contact. The 3rd TSD committee allowed the Parties to update each other on on-going activities in this area. Canadian officials noted that, following an evaluation of its 2014 strategy and Canada-wide consultations, Canada will release a renewed strategy in 2021, which extends beyond the extractive sector by integrating equity considerations and aligning with intersecting commitments, such as climate change, sustainable development goals and a sustainable, inclusive recovery. On the EU side, it has also been an active period with the work taking place on multiple fronts, including: 1) review and creation of new EU Sustainability reporting standard, adoption in April 2021; 2) EU framework for sustainable finance, renewed sustainability and finance strategy, EU taxonomy regulation; 3) product related initiatives including upcoming Sustainable Product Initiative, and recently proposed rules on Responsible sourcing of metals used for battery production; 4) socially responsible and green public procurement (guidance for EU member states), and 5) Sustainable corporate governance initiative (EU Company Law) including mandatory due diligence, building on the OECD-UN guidelines and principles, to be adopted in 2nd quarter 2021. Both Parties emphasized that they share many common objectives in this area and welcome the possibility to identify further initiatives for collaboration in the near future. To this objective, a meeting of respective experts will be organised in early 2021.
Trade and Indigenous peoples
The Parties discussed Canada’s approach to integrating Indigenous peoples into trade agreements. Canada and the EU agreed to continue discussions aiming at identifying an appropriate instrument and concrete joint activities to facilitate the access and benefits of CETA for Indigenous peoples.
Trade and Labour
The Parties recalled their contacts and exchanges in the framework of the trade and labour chapter of CETA since the 2nd TSD committee, outlined their respective domestic priorities on labour in the bilateral and multilateral frameworks and on this basis, the EU and Canada explored areas for further potential cooperation. The EU and Canada highlighted their support to the International Labour Organization (ILO), their close collaboration in the ILO work and support to ILO’s technical assistance projects, including in promoting global ratification of the ILO conventions.
Looking forward, the discussions focused on a number of policy areas, including: combatting forced and child labour. The parties share the common objective and have been exploring various domestic strategies to address these issues. Recognizing the importance of broad international support to effectively tackle them, the EU and Canada will exchange experiences of their respective internal strategies and measures they have undertaken or are preparing, such as Canada’s ban on the importation of forced labour goods or the EU’s work on mandatory due diligence.
Mindful of the DAGs working priorities, the Parties will explore synergies for their international strategies to respond to the COVID-19 pandemic in the labour and social sphere, focusing on supply chains and the most vulnerable groups. Both sides also raised potential cooperation on the basis of the respective agreements or unilateral schemes in Ukraine, Bangladesh and Cambodia.
Trade and Environment and Trade and Climate (“CETA Joint Committee Recommendation on Trade, Climate Action and the Paris Agreement”)
Canada and the EU updated each other on the developments in their respective domestic environment and climate policies, and reviewed their bilateral cooperation activities on these areas in 2020, which focused on climate change, clean technologies, biodiversity and circular economy. Planning forward, the Parties noted potential synergies on the World Circular Economy Forum, which Canada will host in 2021, and will continue close cooperation under the Paris Agreement in the lead-up to COP26 as well as under the Convention on Biological Diversity in the lead up to COP15. The Parties will also continue to cooperate through formal mechanisms such as the Canada-EU High Level Dialogues on Environment and Climate Change.
Of particular relevance for CETA, the EU and Canada agreed that climate action is a cross-cutting issue noting the importance of continuing to mainstream climate and environmental considerations across other relevant areas of work under CETA.
On the basis of the 2018 “Recommendation on CETA, climate action and the Paris Agreement” and building on the outcomes of the 2019 conference “CETA: Taking Action for Trade and Climate”, the Parties highlighted planned work on clean technologies for 2021, notably both the Second Clean Tech workshop and the CETA Clean Tech Summit in March.
The EU confirmed that it will share the outcomes of its Trade and Biodiversity Study (focused on a methodology to assess the impacts of trade on biodiversity), and as time advances, lessons-learned will also be shared with Canada. The EU presented its recently adopted Chemicals Strategy for Sustainability, which sets the path for ensuring production and use of safe and sustainable chemicals in the EU market but also setting a global standard, including by promoting common standards and innovative assessment tools internationally notably with the OECD.
With regards to the multilateral fora, the Parties recalled (as highlighted in the Civil Society Forum the day before) their continued cooperation on trade and environment/climate at the WTO, including in the Friends Advancing Sustainable Trade group.
Moreover, noting the CSF participants’ interest in the carbon border adjustment measures (CBAM), Canada and the EU will have further discussions on CBAMs as the EU develops its proposal and Canada explores its options.
The Parties concluded that given the depth of existing Canada-EU cooperation, as well as the breath of potential activities, the EU and Canada will carefully consider how to prioritize all these activities to ensure resources are properly allocated and that they deliver results within the projected timelines.
TSD Early Review
The EU and Canada recalled their commitment to undertake an early review of the TSD chapters in CETA, with a view to the effective enforceability of CETA provisions on trade and labour, and trade and environment, as set out in Article 10 (a) of the CETA Joint Interpretative Instrument, and took stock of the process. In this framework, the Parties held, virtually, a second dedicated session on 23 October 2020, as well as several interactions with the CETA Domestic Advisory Groups, and a broad discussion with civil society representatives during the 3rd CETA Civil Society Forum on 8-9 December 2020. The EU and Canada discussed and recognized their different views regarding the enforceability of TSD provisions and the process of the review. The EU’s proposal is to review the implementation of TSD chapters by both Parties of CETA article by article to identify potential shortcomings or non-compliance issues and then jointly consider appropriate solutions. Canada’s proposal is that the Parties would agree in advance to take certain steps in the event of a dispute, which could include asking a mediator to consider fines in a case of non-compliance, when a mutually satisfactory resolution of the dispute is not found.
The EU informed Canada about the recent steps that it has taken in order to further strengthen implementation and enforcement of TSD chapters, including the creation of the Chief Trade Enforcement Officer (CTEO) and the Single Entry Point for TSD complaints. The EU will also undertake a review of its TSD implementation and enforcement in 2021. Canada noted that in its most recent trade agreement with the US and Mexico (CUSMA) and in the CPTPP, Canada has negotiated binding environment and labour chapters, which are subject to the overall FTA dispute settlement mechanism. The Parties noted that they remain ready to continue the discussions following the EU’s 2021 review.
The Parties noted civil society calls to make progress in the TSD review and reiterated to the DAG representatives who attended the meeting that they remain available to continue discussion on their respective positions and proposals, and to receive ideas for additional options in the context of CETA TSD implementation and enforcement. Finally, the Parties confirmed they would report on the Early Review of the TSD Chapters at the next meeting of the CETA Joint Committee.
TSD Committee – CETA DAGs representatives meeting
Representatives of the Canadian and European CETA DAGs joined the TSD Committee meeting, during which TSD Committee co-chairs provided a summary of discussions and the ideas for potential collaboration in the coming year. The concrete ideas for bilateral exchanges and cooperation outlined in detail in the CETA joint TSD work plan will be published in early 2021, and the DAGs will have an opportunity to provide comments. The Parties informed the DAGs that they were working on a joint reply to the joint statement of the CETA DAGs. The DAGs representatives outlined the priorities of their work, including trade and climate, obtaining accurate data and measuring sustainability of international trade flows, sustainable recovery from the COVID-19 pandemic, negative impacts on the supply chains, focusing on the most vulnerable groups, and the TSD review. The Parties thanked the DAGs for their consistent and active involvement, including their participation and important contributions in the Third Annual CETA Civil Society Forum.
Participants
Canada
Global Affairs Canada
Environment and Climate Change Canada
Employment and Social Development Canada
Provincial Government Representatives
Mission of Canada to the EU
European Union
EC Directorate-General for Trade
EC Directorate-General for Environment
EC Directorate General for Climate Action
EC Directorate-General for Employment, Social Affairs and Inclusion
Delegation of the European Union to Canada
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