(EU) and the Common Market of the South (MERCOSUR)? - FDCL

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Preface Since the end of 1999 the Common Market of the South (MERCO- SUR) and the European Union (EU) have been negotiating a biregional free trade agreement. Apart from the two initial negotiation pillars, “political dialogue” and “cooperation,” the negotiations are about the liberalization of market access. The negotiations can be differentiated into so-called “sectoral issues” ( “trade in agriculture and fishery,” “trade in services,” and “trade in industrial goods”) and into so-called “horizontal issues” ( “intellectual property,” “market access policy,” “trade and competition,” “trade facilitation,” “trade and investment,” and “government procurement”). The “liberalization of market access” contains, on the one hand, the gradual reduction of foreign trade tariffs and, on the other hand, the determination of biregionally valid rules for all forms of trade related policy designs. According to these rules, any form of “market-distorting” intervention by the side of local, regional or national governments or legislation would be prohibited by means of an internationally valid treaty. According to this logic, anything that distorts the “free play of the market” would be prohibited. In the area of “government procurement,” for example, the EU negotiating delegation does not get tired of addressing the issue of liberalization of government procurement under the nice title of “transparency in government procurement,” whereas MERCOSUR, until the beginning of 2004, has not submitted any offer yet concerning this issue. Despite the nice formulation, by “transparency in government procurement” the EU does not mean “democratic control of government procurement,” but rather “equal market access opportunities for European suppliers.” Also the area of “trade and investment” is about establishing rules that will grant more “legal security” to transnational corporations, and at the same time release them from currently valid requirements and obligations. Thus, laws, rules or requirements which could make foreign suppliers feel discriminated
against, as opposed to domestic suppliers, would be banned and foreign suppliers would have the possibility of taking legal action at an international arbitration court. This legal process would not be open for domestic suppliers due to the primacy of the national legal course. The European Union has closed two similar agreements of the “fourth generation” with Chile and Mexico. These agreements have broadly defined all trade relevant policy areas, stating clearly defined rules for all sectoral and horizontal issues mentioned above. According to these rules the market alone, i.e., price and efficiency, should guarantee an optimal allocation of resources while state interventions to cover local or regional necessities are prohibited. The issue of foreign direct investment plays a central role here: This study wants to investigate the possible impact of an “interregional association agreement,” which comprises broad regulations for all market segments between MERCOSUR and the EU, as occurred, for example, with the EU-Mexico and the EU-Chile agreements. Chapter 1 gives an overview of the current free trade negotiations between the EU and MERCOSUR in the political context of free trade within the WTO and the competing free trade initiatives like, for example, the proposed Free Trade Area of the Americas (FTAA/ALCA/ZLEA). The second chapter deals with the issue of foreign direct investment as the object of international trade regimes. Here the question will be posed whether foreign direct investment can serve as a promoter of development, as is frequently argued by mainstream theory. Chapter 3 gives an overview on European foreign investment in Latin America with particular emphasis on MERCOSUR, while chapter 4 gives an overview of the FDI-legislation in Brazil, and sketches the different actors and interest groups involved, within the context of the current political and legal situation. Special attention will be given to the sectoral issue of services and the position of the European Commission with respect to the Brazilian services sector. Chapter 5 outlines the setting of an “Interregional Association Agreement” between MERCOSUR and the EU on the basis of the interplay of foreign direct investment in bilateral investment treaties, regional free trade agreements and WTO-agreements in interaction with sectoral and horizontal topics under the rules of global free trade.
Page 2 and 3: Christian Russau Enforcement of int
Page 6 and 7: If the “Interregional Association
Page 8 and 9: 8 Chapter 5: The enforcement of int
Page 10 and 11: 10 1.1 Negotiations of the “Inter
Page 12 and 13: 12 A similar agreement of the so-ca
Page 14 and 15: 14 tute in the eyes of many countri
Page 16 and 17: 16 amaraty, where the FTAA-negotiat
Page 18 and 19: 18 free trade agreement between the
Page 20 and 21: 20 at the UN Millenium Summit to ha
Page 22 and 23: 22 on the possibility of a unilater
Page 24 and 25: 24 tual contradictions between the
Page 26 and 27: 26 fired. The workers union OGB-L,
Page 28 and 29: 28 policy and EU development policy
Page 31 and 32: Chapter 2: Foreign direct investmen
Page 33 and 34: 50% in 2002 as compared to the prev
Page 35 and 36: The reasons for propagating this co
Page 37 and 38: • according to a study conducted
Page 39 and 40: promotion of domestic demand, in or
Page 41 and 42: 2.2 International Agreements and Tr
Page 43 and 44: 2.3 The World Trade Organization WT
Page 45 and 46: • trade and investment • compet
Page 47 and 48: 2.3.3 The GATS agreement The Genera
Page 49 and 50: which works on a profit-basis, sees
Page 51 and 52: “deadline: by 1 January 2005”.
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Stockholm Chamber of Commerce (SCC)
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58 3.1 European foreign investment
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60 zations and liberalization in La
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62 the profitability, on the electr
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64 America. Also the issue of human
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66 • Thirdly the WTO Dispute Sett
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68 to the U.S. trade power by rapid
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70 The largest trade balance defici
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72 OECD area by European companies.
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74 EDF, has issued a similar compla
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76 European automobile producers in
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78 But not only international law o
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80 ment,” which in the beginning
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82 4. 1 The free trade agreement be
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84 issues for us.” 233 On the oth
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86 capital flows” explicitly. The
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88 which also speaks out against th
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90 in Congress and encouraged the B
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92 studies in 2003 on the impact of
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94 The MEBF successfully works as a
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96 “We have tried to explain how
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98 4.2 The example of Brazil: Forei
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100 Brazilian Constitution. This wo
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102 countries through CC-5 accounts
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104 4.3 Brazil, foreign direct inve
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106 “Commercial Presence: The jur
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108 Providing cheaper access to wat
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110
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112 5.1 Foreign direct investment i
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114 The agreement on government pro
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116 5.2 The case of Chile: Foreign
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118 which was believed to be dead,
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120 c) The still pending Doha “De
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122 gesamtamerikanischen Freihandel
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124 · http://europa.eu.int/comm/co
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126 · http://www.citizen.org/ · h
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128 · http://www.rebrip.org.br ·
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130 um den Markt der wiederentdeckt
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132 · Torrent, Ramón: Acordos Int
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134 DIHK Deutscher Industrie- und H
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136 Lomé Lomé-Agreement between E
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About FDCL is a nonprofitorganizati
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(EU) and the Common Market of the South (MERCOSUR)? - FDCL

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