EU-Japan Trade Agreement Enters Into Force

Author:Ms Bernardine Adkins, Ursula Johnston and Sean Giles
Profession:Gowling WLG
 
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The EU Japan Economic Partnership Agreement1 (the "EPA"), comes into force today, 1 February 2019. The EPA covers almost one third of the world's total GDP, removing 99% of the tariffs applied on €1 billion of goods the EU exports to Japan.2

In addition to reducing or abolishing tariffs, the EPA addresses a number of non-tariff barriers to EU-Japan trade. Key facets of the EPA of particular relevance to key EU-Japan trade sectors include:

EU companies can participate on an equal footing with Japanese companies in public procurement tenders in 54 'core' Japanese cities; Commitment to ensuring that their standards and technical regulations are aligned with international standards; Mutual recognition of data protection systems allowing for a free flow of data; European agricultural products benefitting from Protected Geographic Indication in the EU will be protected and recognised by Japan. This extends to Scottish Farmed Salmon, Aceto Balsamico di Modena, Prosecco, Scotch Whisky, Blue Stilton cheese and West Country Farmhouse Cheddar cheese; Cars will be subject to the same international standards on product safety and environmental protection in both the EU and Japan, removing the need to obtain new tests or certification when exporting vehicles to Japan from the EU; Targeted dispute settlement in relation to motor vehicles will be introduced; and Harmonised rules for the export of beer creating equality of tax treatment. Negotiations are ongoing for a potential agreement on the protection of investments between the EU and Japan. Specifically, the EU is seeking to implement its proposal on the Investment Court System in its trade relations. The purpose of the system is to adjudicate disputes between investors and states where its jurisdiction has been accepted under bilateral treaties.

Brexit and the EPA

The EU and the UK have agreed that the UK will be treated as an EU member during any agreed transition period for the purposes of international agreements between the EU and third countries. However, the continued application of EU agreements to the UK will require the consent of the relevant third country.

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