EU Court Ruling Seen as Unlikely to Derail Singapore Trade Deal

  • Decision adds hurdles to agreement discussed since 2010
  • EU court says national parliaments must have say on such deals

A ruling by the top European Union court that all national parliaments should ratify a free-trade agreement with Singapore is not expected to kill the pact, even if the added hurdles delay its implementation.

The EU Court of Justice said Tuesday that approval from national legislatures was needed in addition to support from top European bodies to enact the pact with the Southeast Asian city-state. That’s because the court found that several provisions in the agreement -- such as dispute settlement -- applied to matters shared between the bloc and its member states.

The decision, which had been expected, could lengthen negotiations that began seven years ago and extend talks past Singapore’s original completion goal of 2018-19. Singapore’s two-way trade with the EU totaled $59.7 billion last year, second only to China, according to International Monetary Fund data.

While securing approval from national parliaments will take more time, Yeo Lay Hwee, director of the European Union Centre in Singapore, said it wouldn’t prevent final passage.

“Once the Council and the European Parliament ratify the agreement, it will be possible to provisionally apply the agreement in those areas in which the EU has exclusive competence,” Yeo, who’s also a senior research fellow at the Singapore Institute of International Affairs, said before the ruling. The current political mood regarding trade justifies having “agreements that are high quality and transparent, allowing for national parliaments to have some sort of scrutiny.”

An adviser to the EU court signaled in December that individual nations should ratify the deal because some aspects of it fall under national jurisdictions.

The ruling is also important for the U.K., because it affects how any negotiations on a long-term post-Brexit deal between London and Brussels might play out. While the formal two-year countdown until the U.K. leaves the EU was triggered on March 29, European Commission President Jean-Claude Juncker said the real political negotiations on Article 50 would start after the U.K. holds parliamentary elections June 8.

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