RESTRICTED  
  
WT/TPR/S/395  
10 December 2019 
(19-8493) Page: 1/308 
Trade Policy Review Body   
 
TRADE POLICY REVIEW  
REPORT BY THE SECRET ARIAT  
EUROPEAN UNION 
This report, prepared for the fourteenth Trade Policy Review of the European Union, has been drawn 
up by the WTO Secretariat on its own responsibility. The Secretariat has, as required by the 
Agreement establishing the Trade Policy Review Mechanism (Annex 3 of the Marrakesh Agreement 
Establishing the World Trade Organization), sought clarification from  the European Union on its trade 
policies and practices.  
 
Any technical questi ons arising from this report may be addressed to Mr. Mark Koulen (tel: 022 739 
5224); Mr. Ricardo Barba (tel: 022 739 5088); Mr. Cédric Pene (tel: 022 739 5141); 
Mrs. Denby  Probst (tel: 022 739 5847); Ms. Anna Caroline Müller (tel: 022 739 5514); 
Mr. Micha el Kolie (tel: 022 739 5931); Ms. Marie -Bel Martinez -Hommel (tel: 022 739 5201); and 
Ms. Takako Ikezuki (tel: 022 739 5534).  
 
Document WT/TPR/G/395 contains the policy statement submitted by the European Union.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on European Union. This report was 
drafted in English.  
  WT/TPR/S/395 • European Union  
 
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  CONTENTS  
SUMMARY  ................................ ................................ ................................ ........................  9 
1  ECONOMIC ENVIRONMEN T ................................ ................................ .........................  16 
1.1  Main Features of the Economy  ................................ ................................ ...................... 16 
1.2  Recent Economic Developments  ................................ ................................ .................... 16 
1.2.1   Balance of payments  ................................ ................................ ................................ .19 
1.2.2   Fiscal governance and performance  ................................ ................................ ............ 20 
1.2.3   Monetary and exchange rate developments  ................................ ................................ .21 
1.2.4   Outlook  ................................ ................................ ................................ ................... 22 
1.2.5   Main challenges and policy response  ................................ ................................ ........... 23 
1.3  Developments in Trade and Investment  ................................ ................................ ......... 25 
1.3.1   Trends and patterns in merchandise and services trade  ................................ ................. 25 
1.3.2   Trends and patterns in foreign direct investment (FDI)  ................................ .................. 29 
2  TRADE AND INVESTMEN T REGIMES  ................................ ................................ ...........  33 
2.1  General Framework  ................................ ................................ ................................ .....33 
2.2  Trade Policy Formulation and Objectives  ................................ ................................ ......... 35 
2.3  Trade Agreements and Arrangements  ................................ ................................ ............ 39 
2.3.1   WTO ................................ ................................ ................................ ....................... 39 
2.3.2   Regional and preferential agreements  ................................ ................................ ......... 40 
2.3.2.1   Reciprocal preferences  ................................ ................................ ............................ 40 
2.3.2.2   Unilateral preferences  ................................ ................................ ............................. 44 
2.4  Investment Regime  ................................ ................................ ................................ .....46 
2.4.1   Investment and the EU internal market  ................................ ................................ .......46 
2.4.2   Investment relations with third countries  ................................ ................................ .....47 
2.4.2.1   Establishment of a cooperation mechanism for the screening of FDI  ............................. 47 
2.4.2.2   Agreements with third countries  ................................ ................................ .............. 50 
3  TRADE POLICIES AND PRACTICES BY MEASURE  ................................ .........................  52 
3.1  Measures Directly Affecting Imports  ................................ ................................ ............... 52 
3.1.1   Customs procedures, valuation, and requirements  ................................ ........................ 52 
3.1.1.1   Legal framework and electronic systems  ................................ ................................ ...53 
3.1.1.2   Trade facilitation  ................................ ................................ ................................ ....56 
3.1.1. 3  Customs valuation  ................................ ................................ ................................ .57 
3.1.2   Rules of origin  ................................ ................................ ................................ .......... 57 
3.1.2.1   Non-preferential  ................................ ................................ ................................ ....58 
3.1.2.2   Preferential  ................................ ................................ ................................ ........... 58 
3.1.3   Tariffs  ................................ ................................ ................................ ..................... 60 
3.1.3.1   Nomenclature and bound rates  ................................ ................................ ................ 61 
3.1.3.2   Applied rates  ................................ ................................ ................................ ......... 61 
3.1.3.3   TRQs and administration  ................................ ................................ ......................... 64 
3.1.3.4   Duty suspensions and special tariff treatment  ................................ ............................ 66 WT/TPR/S/395 • European Union  
 
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  3.1.3.5   Preferential tariffs  ................................ ................................ ................................ ..67 
3.1.4   Other charges affecting imports  ................................ ................................ .................. 68 
3.1.5   Import prohibitions, restrictions, and licensing  ................................ ............................. 72 
3.1.6   Anti-dumping, countervailing, and safeguard measures  ................................ ................. 78 
3.1.6.1   Anti-dumping and anti -subsidy measures  ................................ ................................ ..78 
3.1.6.2   Safeguards ................................ ................................ ................................ ............ 83 
3.1.7   Other m easures affecting imports  ................................ ................................ ............... 85 
3.2  Measures Directly Affecting Exports  ................................ ................................ ............... 86 
3.2.1   Customs procedures and requirements  ................................ ................................ ........ 86 
3.2.2   Taxes, charges, and levies  ................................ ................................ ......................... 87 
3.2.3   Export prohibitions, restrictions, and licensing  ................................ .............................. 87 
3.2.3.1   Prohibitions, restrictions, and licensing  ................................ ................................ .....87 
3.2.3.2   Export controls  ................................ ................................ ................................ ......89 
3.2.4   Export support and promotion  ................................ ................................ .................... 91 
3.2.5   Export finance, insurance, and guarantees  ................................ ................................ ...92 
3.3  Measures Affecting Production and Trade ................................ ................................ ........ 96 
3.3.1   Incentives  ................................ ................................ ................................ ................ 96 
3.3.1.1   EU-level subsidies  ................................ ................................ ................................ ..96 
3.3.1.2   State aid  ................................ ................................ ................................ ............... 98 
3.3.1.3   Taxation  ................................ ................................ ................................ .............  102 
3.3.2   Standards and technical requirements  ................................ ................................ ....... 108 
3.3.2.1   New Legislative Framework  ................................ ................................ ...................  109 
3.3.2.2   Institutional framework  ................................ ................................ ........................  111 
3.3.2.3   The role of standardization for digital technologies  ................................ ...................  113 
3.3.2.4   Standardization and climate change  ................................ ................................ ....... 114 
3.3.2.5   Rapid Alert System for non -food dangerous products (RAPEX)  ................................ ... 114 
3.3.2.6   Technical Barriers to Trade (TBT) Commi ttee in the WTO  ................................ ..........  115 
3.3.3   Sanitary and phytosanitary requirements  ................................ ................................ ... 116 
3.3.3.1   Plants and plant products  ................................ ................................ ......................  119 
3.3.3.2   Live animals and animal products  ................................ ................................ ..........  120 
3.3.3.3   Rapid Alert System for Food and Feed (RASFF)  ................................ ........................  121 
3.3.3.4   SPS Committee in the WTO  ................................ ................................ ...................  122 
3.3.4   Competition policy  ................................ ................................ ................................ .. 123 
3.3.4. 1  Enforcement of competition law (anti -competitive agreements and abuse of dominant 
position)  ................................ ................................ ................................ .........................  125 
3.3.4.2   Mergers and acquisitions  ................................ ................................ .......................  127 
3.3.4.3   Sector inquiries and reports  ................................ ................................ ..................  129 
3.3.4.4   International cooperation  ................................ ................................ ......................  131 
3.3.5   State trading, state -owned enterprises, and privatization  ................................ ............  132 
3.3.6   Government procurement  ................................ ................................ ........................  135 
3.3.7   Intellectual property rights  ................................ ................................ .......................  144 WT/TPR/S/395 • European Union  
 
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  3.3.7.1   Copyright and related rights  ................................ ................................ ..................  146 
3.3.7.2   Industrial property  ................................ ................................ ...............................  148 
3.3.7.2.1   Patents  ................................ ................................ ................................ ............  148 
3.3.7.2.2   Plant variety rights  ................................ ................................ ............................  151 
3.3.7.2.3   Trademarks  ................................ ................................ ................................ ...... 151 
3.3.7.2.4   Geographical indications  ................................ ................................ ....................  153 
3.3.7.2.5   Undisclosed information  ................................ ................................ .....................  154 
3.3.7.2.5.1   Trade secrets  ................................ ................................ ................................ . 154 
3.3.7. 2.5.2  Clinical trial data  ................................ ................................ ............................  155 
3.3.7.3   Enforcement  ................................ ................................ ................................ ........  156 
3.3.7.3.1   Economic impact  ................................ ................................ ...............................  156 
3.3.7.3.2   Enforcement within the EU  ................................ ................................ .................  158 
3.3.7.3.3   Enforcement at the EU's external borders  ................................ .............................  159 
3.3.7.3.4   Enforcement at the international level ................................ ................................ .. 160 
4  TRADE POLICIES BY S ECTOR  ................................ ................................ ....................  161  
4.1  Agriculture and Fisheries  ................................ ................................ ............................  161 
4.1.1  Agriculture  ................................ ................................ ................................ .............  161 
4.1.1.1   Trade  ................................ ................................ ................................ .................  162 
4.1.1.2   Agricultural policies  ................................ ................................ ..............................  164 
4.1.1.2.1   Domestic support  ................................ ................................ ..............................  165 
4.1.1.2.1.1   Direct payments  ................................ ................................ .............................  165 
4.1.1.2.1.2   Internal market support measures  ................................ ................................ .... 174 
4.1.1.2.1.3   Rural development  ................................ ................................ .........................  180 
4.1.1.2.2   Export subsidies and export measures with equivalent effect  ................................ .. 183 
4.1.1.2.3   Market access  ................................ ................................ ................................ ... 183 
4.1.1.3   Domestic support levels  ................................ ................................ ........................  185 
4.1.1.3.1   WTO notifications  ................................ ................................ ..............................  185 
4.1.1.3.2  OECD monitoring and evaluation of agricultural policies  ................................ .........  187 
4.1.2   Fisheries  ................................ ................................ ................................ ................  188 
4.1.2.1   Fisheries  ................................ ................................ ................................ .............  188 
4.1.2.2   Trade performance  ................................ ................................ ...............................  189 
4.1.2. 3  Law, regulations, and polices  ................................ ................................ .................  190 
4.1.2.4   Market access and import requirements  ................................ ................................ .. 193 
4.1.2.5   External policy  ................................ ................................ ................................ ..... 195 
4.1.2.6   Structural support  ................................ ................................ ................................  196 
4.2  Energy  ................................ ................................ ................................ .....................  198 
4.3  Manufacturing  ................................ ................................ ................................ ...........  207 
4.4  Services  ................................ ................................ ................................ ...................  218 
4.4.1   Financial S ervices  ................................ ................................ ................................ ... 218 
4.4.1.1   Recent performance  ................................ ................................ .............................  218 WT/TPR/S/395 • European Union  
 
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  4.4.1.2   Regulatory developments  ................................ ................................ ......................  219 
4.4.1.2.1   Measures aimed at reducing risk and enhancing the resilience of the banking sector  . 219 
4.4.1.2.2   Banking Union  ................................ ................................ ................................ .. 221 
4.4.1.2.3   Capital Markets Union (CMU)  ................................ ................................ ..............  222 
4.4.1.2.3.1   Measures to make the most of the Single Market through new European products, 
labels and passports  ................................ ................................ ................................ .........  223 
4.4.1.2.3.2   Measures to sup port businesses and investors through clearer and simpler rules  .... 224 
4.4.1.2.3.3   Measures to establish more efficient supervision of  capital markets  ......................  225 
4.4.1.2.3.4   Measures on sustainable finance  ................................ ................................ ...... 226 
4.4.1.2.3.5   Other measures pertaining to the CMU  ................................ ..............................  227 
4.4.1.2.4   Third-country equivalence and international cooperation  ................................ ........  227 
4.4.2   Construction services  ................................ ................................ ..............................  228 
4.4.2.1   Overview  ................................ ................................ ................................ ............  228 
4.4.2.2   Legal and policy framework  ................................ ................................ ...................  230 
4.4.2.3   Support  ................................ ................................ ................................ ..............  233 
4.4.2.4   Trade commitments, restrictions, and openness  ................................ ......................  233 
4.4.3   E-commerce ................................ ................................ ................................ ...........  234 
4.4.3.1   E-commerce in the context of the Digital Single Market (DSM) Strategy  .....................  234 
4.4.3.2   Improving access for consumers to online goods and services across Europe  ...............  236 
4.4.3.2.1   Cooperation regarding the application of consumer protection rules  .........................  236 
4.4.3.2.2   VAT aspects of e -commerce  ................................ ................................ ...............  237 
4.4.3.2.3   Prohibition of unjustified geoblocking and other forms of discrimination based on 
customers ' nationality, place of residence or place of establishment  ................................ ....... 238 
4.4.3.2.4   Regulatory oversight and transparency of cross -border par cel delivery services  ........  239 
4.4.3.2.5   Harmonization of contract and consumer protection laws  ................................ ....... 240 
4.4.4   Telecommunications services  ................................ ................................ ...................  242 
4.4.4.1   Telecommunications in the context of the DSM Strategy  ................................ ...........  242 
4.4.4.2   Reform of telecoms rules: the European Electronic Communications Code  ...................  243 
4.4.4.3   Other measu res in the field of telecommunications  ................................ ...................  248 
4.4.4.3.1   Use of the 470 -790 MHz frequency band  ................................ ..............................  248 
4.4.4.3.2   Abolition of retail roaming charges  ................................ ................................ ...... 249 
4.4.4.3.3   Promotion of Internet connectivity in local communities  ................................ .........  249 
4.4.5   Other measures adopted during the review period under the second pillar of the DSM 
Strategy  ................................ ................................ ................................ .........................  249 
4.4.5.1   Online platforms  ................................ ................................ ................................ .. 249 
4.4.5.1.1   EU Cybersecurity Act  ................................ ................................ .........................  251 
4.4.6   Audiovisual services  ................................ ................................ ................................  252 
5  APPENDIX TABLES  ................................ ................................ ................................ ... 254  
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  CHARTS  
 
Chart 1.1 Contribution to GDP growth, 2015 -18 ................................ ................................ .....18 
Chart 1.2 Gross fixed capital formation (investments)  ................................ ............................ 18 
Chart 1.3 Current account balance as % of GDP  ................................ ................................ ....20 
Chart 1.4 General government deficit/surplus as % of GDP  ................................ ..................... 21 
Chart 1.5 Composition of merchandise trade, 2015 and 2018  ................................ .................. 26 
Chart 1.6 Direction of merchandise trade, 2015 and 2018  ................................ ....................... 27 
Chart 3.1 Applied MFN tariff rate distribution for agricultural and non -agricultural products,  
2019  ................................ ................................ ................................ ............................... 63 
Chart 3.2 Overview of anti -dumping and anti -subsidy activity, 2016 -18 ................................ ....81 
Chart 3.3 Anti -dumping and anti -subsidy measures in force, by region, 2016 -18 ....................... 82 
Chart 3.4 Anti -dumping and anti -subsidy inve stigations initiated, by product sector, 2016 -18 .....83 
Chart 3.5 Outcome of expiry reviews concluded, 2016 -18 ................................ ....................... 83 
Chart 3.6 State aid, 2017  ................................ ................................ ................................ .. 101 
Chart 3.7 Liabilities of public corporations, by controlling government level, 2 017 ....................  134 
Chart 4.1 Domestic support, 2007/08 -2016/17  ................................ ................................ .... 186 
Chart 4.2  Production and trade of fish and fishery products  ................................ ...................  190 
Chart 4.3 Total gross NPLs and advances  ................................ ................................ ............  221 
Chart 4.4 Total gross NPLs and advances  ................................ ................................ ............  221 
Chart 4.5 Exports of construction services, construction a broad, 2017  ................................ .... 229 
 
TABLES  
 
Table 1.1 Selected indicators, 2015 -18 ................................ ................................ ................. 16 
Table 1.2 Extra -EU trade in services, by sector and partner, 2015 -18 ................................ .......28 
Table 1.3 Extra -EU FDI flows, 2015 -17 ................................ ................................ ................. 30 
Table 1.4 Extra -EU FDI stocks, 2015 -17 ................................ ................................ ............... 31 
Table 1.5 FDI stocks by major partner, 2015 -17 ................................ ................................ ....31 
Table 3.1 UCC new transitional measures for certain electronic systems, 2019  .......................... 54 
Table 3.2 Overview of preferential rules of origin, 2019  ................................ .......................... 59 
Table 3.3 Structure of MFN tariffs, 2019  ................................ ................................ ............... 62 
Table 3.4 Applied MFN tariff summary, 2019  ................................ ................................ ......... 63 
Table 3.5 Tariffs under preferential agreements, 2019  ................................ ............................ 67 
Table 3.6 Minimum excise duties on EU harmonized products, 2020  ................................ ......... 71 
Table 3.7 Prohibitions or restrictions on imports, 2019  ................................ ............................ 76 
Table 3.8 Products subject to import licensing, 2019  ................................ .............................. 77 
Table 3.9 Prohibitions, restrictions or licensing on e xports, 2019  ................................ .............. 88 
Table 3.10 Controlled dual -use exports, 2015 -17 ................................ ................................ ...91 
Table 3.11 Export promotion authorities, 2019  ................................ ................................ ......92 
Table 3.12 Overview of legislation pertaining to export credits, guarantees or insurance  ............. 94 
Table 3.13 Export -credit statistics, as reported to the OECD, 2016 -17 ................................ ......95 WT/TPR/S/395 • European Union  
 
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  Table 3.14 Non -crisis related state aid, 2013 -17 ................................ ................................ .. 100 
Table 3.15 Use of crisis -related state aid, 2008 -17 ................................ ...............................  102 
Table 3.16 Taxes and social contributions in the EU -28, 2014 -17 ................................ ...........  103 
Table 3.17 VAT in the EU -28 ................................ ................................ .............................  104 
Table 3.18 Personal income taxes and households' social contributions  ................................ ... 106 
Table 3.19 Corporation tax and employer's actual social contri butions  ................................ .... 107 
Table 3.20 Principal TBT legislation, 20 19 ................................ ................................ ...........  108 
Table 3.21 Principal SPS legislation, 20 19 ................................ ................................ ...........  116 
Table 3.22 RASFF notifications, 2012 -19 ................................ ................................ .............  122 
Table 3.23 Competition policy legislative framework – selected rules  ................................ ...... 124 
Table 3.24 Anti -trust cases, investigations, decisions, and fines  ................................ .............  126 
Table 3.25 Merger notifications and decisions 2015 -18 ................................ .........................  129 
Table 3.26 Summary table of other reports relating to competition policy issues  ......................  130 
Table 3.27 New and full no tifications on STEs  ................................ ................................ ...... 132 
Table 3.28 Public procurement thresholds from 1 January 2018  ................................ .............  139 
Table 3.29 Estimated value of public procurement by general government, 2016 -18 ................  140 
Table 3.30 Contribution of IP industries to employment, GDP, trade, and average wage  
premium of IP -intensive industries, 2014 -16 average  ................................ ...........................  144 
Table 3.31 Status of participation in WIPO conventions and treaties  ................................ ....... 146 
Table 3.32 Trends in seizures based on customs figures, 2014 -17 ................................ ..........  157 
Table 3.33 Detention totals at EU borders, reported for 2016 and 2017  ................................ .. 159 
Table 4.1 Total production value of agricultural products, 2014 -18 ................................ .........  161 
Table 4.2 Selected indic ators of agricultural structure, 2016  ................................ ..................  162 
Table 4.3 Exports and imports of agricultural products (HS 4 -digit level), 2015 -18 ...................  163 
Table 4.4 Net amounts – national ceilings for direct payments, 2015 -20 ................................ . 165 
Table 4.5 Member State decisions regarding implementation of direct payments in claim  
year 2018  ................................ ................................ ................................ .......................  170 
Table 4.6 Crop -specific payment for cotton  ................................ ................................ .........  172 
Table 4.7 Intervention  and private storage aid, 2017 and 2018  ................................ .............  174 
Table 4.8 Market support measures for poultry and pigmeat, linked to sanitary crises,  
2017-19 ................................ ................................ ................................ .........................  177 
Table 4.9 National envelopes for rural development, 2014 -20 ................................ ................  180 
Table 4.10 Rural development priorities and focus areas  ................................ .......................  182 
Table 4.11 OECD indicators for support to agriculture, 2011 -18 ................................ .............  187 
Table 4.12 Main fisheries management principles/instruments  ................................ ...............  192 
Table 4.13 Average applied tariffs for major species by selected tariff regimes, 2019  ...............  194 
Table 4.14 List of fisheries agreements  ................................ ................................ ...............  196 
Table 4.15 Energy production, 2017  ................................ ................................ ...................  199 
Table 4.16 Net imports of energy, 2007 -17 ................................ ................................ .........  200 
Table 4.17 Manufacturing main indicators, 2016  ................................ ................................ .. 208 
Table 4.18 Trade in cars, 2018  ................................ ................................ ..........................  212 WT/TPR/S/395 • European Union  
 
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  Table 4.19 Trade in chemicals and related products ( SITC 5), 2008 and 2018  .........................  214 
Table 4.20 Crude steel production, 2014 -18 ................................ ................................ ........  217 
Table 4.21 Trade in construction services, 2015 -18 ................................ ..............................  229 
Table 4.22 Principal legal instruments for construction services  ................................ .............  232 
Table 4.23 Selected indicators of developments in the telecoms sector, 2010 -18 .....................  243 
 
BOXES  
 
Box 3.1 UCC framework  ................................ ................................ ................................ ......54 
Box 3.2 Main elements of the trade remedy modernization,  2018 ................................ ............ 79 
Box 3.3 Government procurement strategic priorities  ................................ ...........................  137 
 
APPENDIX TABLES  
 
Table A1.1 Selected economic indicators, 2015 -18 ................................ ...............................  254 
Table A1.2 Extra -EU merchandise exports by product group, 2015 -18 ................................ .... 256 
Table A1.3 Extra -EU merchandise exports by destination, 2015 -18 ................................ ........  257 
Table A1.4 Extra -EU merchandis e imports by product group, 2015 -18 ................................ .... 258 
Table A1.5 Extra -EU merchandise imports by origin, 2015 -18 ................................ ................  259 
Table A1.6 Intra - and extra -EU merchandise trade by member State, 2015 -18 ........................  260 
 
Table A2.1 European Union, Selected notifications to the WTO, March  2017-September  2019 .... 261 
Table A2.2 Involvement in WTO dispute settlement, March 2017 -September 2019  ...................  264 
Table A2.3 Participation in RTAs (notified and non -notified in force), as at 30  September  2019 .. 265 
 
Table A3.1 WTO TRQs, agricultural and non -agricultural products, 2018 -19 ............................  267 
Table A3.2 Excise duties other than on EU harmonized products, by member State, 2020  .........  286 
Table A3.3 Indicative list of export -credit agencies or guarantee schemes, as at  
September  2019 ................................ ................................ ................................ ..............  289 
Table A3.4 SOEs  ................................ ................................ ................................ ..............  292 
Table A3.5 Summary of main legislative measures on IPRs, 2019  ................................ ..........  298 
Table A3.6 Term of protection of major IPRs, 2019  ................................ ..............................  302 
 
Table A4.1 Regulatory restrictions in construction services, by selected member State, 2018  .... 304 
  
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  SUMMARY  
1. This 14th Trade Policy Review report of the European Union (EU) covers developments in 
EU trade policy during the period March 2017 -September 2019. "EU" in this connection means the 
EU-28.  
2. Real GDP growth in the EU was relatively strong in 2017 -18, but slowed some what in the 
second half of 2018 due to several factors, including weakness in the manufacturing sector, 
escalating trade tensions , and the prospect of the United Kingdom's withdrawal from the EU. Annual 
GDP growth is expected to decline from 2.0% in 2018 t o 1.4% in 2019 and to increase to 1.6% in 
2020. Significant progress has been made in recent years regarding the reduction of unemployment  
and poverty, the correction of macroeconomic imbalances , and  the improvement of the fiscal 
positions of EU member Sta tes. While discussions on an EU digital services tax regime were 
suspended, several EU member States introduced such a tax at the national level. The relatively 
positive recent growth performance of the EU economy provides  an opportunity to focus on certai n 
long-term challenges that need to be addressed to support stronger and more inclusive growth by 
improving productivity and boosting investment. In this regard, recent policy initiatives aim to better 
exploit the potential of the EU's single market, which  remains fragmented, especially in services, 
energy and the digital economy.  
3. Extra-EU trade in goods and services as a share of EU -GDP was nearly 35% in 201 8. The 
share of the EU in world trade in goods and services was 16.7% in 2017 -18 and has been on a 
declining trend during the last two decades. The EU remains the most important trading partner for 
some 80  economies. While EU merchandise trade with third countries continued to grow, the 
merchandise trade balance recorded a deficit in 2018 mainly due to the large deficit in fuel products. 
The United  States, China and Switzerland continued to be the ma in destinations of EU merchandise 
exports. The EU was a net exporter of services , and its surplus in services trade increased during 
the review period. The U nited States and China are the EU's main partners in services trade.  
4. The scope of the EU's exclusive competence to conclude international trade agreements was 
clarified by an opinion of the Court of Justice of the EU (CJEU). In light of this opinion, the exclusive 
EU competence to conclude international trade agreements is now understood to cover the following 
matters: trade in goods; trade in services, including all transport services other than air transport; 
trade -related aspects of intellectual propert y; public procurement; market access and investment 
protection in relation to foreign direct investment (FDI); and the termination of member State 
bilateral investment agreements for the parts concerning exclusive competence.  
5. In March 2017, the United Kin gdom notified its intention to withdraw from the EU under 
Article  50 of the Treaty on European Union on 31 March 2019. While negotiations under Article 50 
have resulted in an agreement on the terms of the withdrawal, this agreement had not yet been 
ratifie d at the time of the circulation of this report. On 29 October 2019, the European Council, in 
agreement with the United Kingdom, decided on an additional extension of the period provided for 
in Article  50(3), until 31 January 2020.  
6. The EU pursues "a balanc ed and progressive trade policy to harness globalisation", premised 
on the idea that global trade is a key contributor to a competitive and prosperous EU but needs to 
be proactively shaped and managed to ensure that it is fair, projects values and remains firmly 
anchored in a rules -based system. The first main objective of this policy is to conclude new trade 
partnerships to build progressive rules for global trade  and to use trade policy to promote universal 
values regarding environment al, social and labour protection and fundamental rights , and preserv e 
the right to regulate in the public interest . Aside from the negotiation and conclusion of bilateral 
trade agreements, a noteworthy development relating to this first objective is that gender issues 
have begun to figure more prominently in EU trade policy. In addition, an Action Plan was adopted 
to improve the implementation and effectiveness of provisions on sustainable development in the 
EU's free trade agreements (FTAs).  
7. A second main objective of t he balanced and progressive trade policy is to protect EU interests 
and ensure fairness through a robust trade and investment policy . This was reflected in, inter alia , 
reforms of the EU's trade remedies' instruments, discussion and proposals on the need t o combat 
unfair subsidy practices, discrimination and lack of reciprocity in government procurement, and the 
adoption of a new mechanism for the screening of FDI from third countries. A third main objective WT/TPR/S/395 • European Union  
 
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  is to deliver effective agreements through a tran sparent and inclusive negotiation process.  In this 
regard, the EU institutions took steps to enhance transparency in the negotiation of trade 
agreements, such as by publishing texts of (draft) negotiating directives. The EU also adopted a new 
approach to t he architecture of bilateral trade agreements. This approach envisages the negotiation 
of two separate agreements: an FTA which will cover matters within the exclusive competence of 
the EU and which will be concluded only by the EU, and an Investment Prote ction Agreement which 
will include both matters in which the EU has exclusive competence and matters in which the EU and 
its member States share competences and which will be concluded by the EU and the member 
States.  
8. In light of recent challenges facing t he multilateral trading system, the EU emphasized the 
importance of preserving an open, rules -based multilateral trading system , with the WTO at its core , 
and the need for comprehensive reform of the WTO . The EU made numerous notifications during 
the revie w period in areas such as agriculture, trade remedies, technical regulations, regional trade 
agreements and preferential rules of origin. It was a complainant in five new dispute settlement 
cases and a respondent in one new case.  
9. As at 30 September 2019, the EU had 41 FTAs in force with 72 countries. The largest 
FTA partners, based on data on trade in goods, were Switzerland, Turkey and Norway. During the 
review period, the FTA with Canada was applied provisionally; the FTA with Japan entered into force; 
FTAs and Investment Protection Agreements with Singapore and Viet Nam were completed; 
FTA negotiations were concluded at a political level with Mexico and with Mercosur; negotiations 
were launched on the modernization of the existing agreement with Chile; a nd negotiations on 
comprehensive FTAs were launched with Australia and New Zealand. Aside from the economic 
opportunities, the EU considers that these FTAs have strategic benefits in an international trading 
environment that has become more uncertain and u nstable.  
10. The EU adopted a Joint Statement with the United States in July 2018 in which they agreed, 
inter alia , to work towards the elimination of tariffs, non -tariff barriers, and subsidies on non -auto 
industrial goods, and towards the reduction of barri ers to trade in services, chemicals, 
pharmaceuticals, medical products and soybeans.  
11. The EU Generalized Scheme of Preferences (GSP) provides a general GSP arrangement and 
two special arrangements. As at 30 September 2019, there were 15 beneficiaries of th e EU's general 
GSP arrangement, 8 beneficiaries of the EU's GSP + arrangement, and 48 beneficiaries of the 
EU's Everything But Arms arrangement. A mid -term review of the GSP scheme concluded in 2018 
that there was no need to amend the GSP Regulation before  its expiry on 31 December 2023 but 
that measures should be taken to improve transparency and inclusiveness in GSP monitoring, both 
in the EU and in the beneficiary countries, and to promote greater awareness of GSP in beneficiary 
countries.  
12. New EU legisl ation on the screening of FDI into the EU from third countries was adopted in 
2019, against the background of growing concerns regarding the impact on the strategic interests 
of the EU or its member States of certain types of FDI, especially in cases invol ving state -owned 
enterprises and strategic sectors. It provides for a framework for the screening by member States 
of FDI into the EU on the grounds of security or public order, and establishes a mechanism for 
cooperation between member States, and between  member States and the Commission, regarding 
FDI from third countries likely to affect security or public order. It does not create a centralized 
mechanism at EU level for the screening of FDI.  
13. The EU's Union Customs Code (UCC) for customs procedures at th e border was implemented 
in 2016 , although the application of several elements remain ongoing pending the full functioning of 
several electronic systems, some of which have faced delays.  The EU's single window initiative 
continues to be gradually implement ed. New provisions for low -value consignments are expected to 
be introduced in 2021.  
14. The EU's applied tariff structure did not change significantly since the last Review, and the 
rates remain nearly identical.  The simple average MFN tariff rate remains at  6.3% . MFN applied rates 
are generally identical, or close, to the WTO bound rates. T he agricultural sector continues to stand 
out in the tariff analysis due to significantly higher rates (14.2% on average), the wide tariff range, 
and the significant use o f non-ad valorem  rates and tariff quotas. For non -agricultural products, the WT/TPR/S/395 • European Union  
 
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  fish and fishery products (11.8% simple average) and clothing (11.6%) sectors stand out as the 
ones with the highest tariff protection among an overall low average of 4.2%.  
15. The E U maintains different categories of tariff rate quotas (TRQs) for both agricultural and 
non-agricultural products. As at 1 January 2019, there were 712 preferential TRQs in place pursuant 
to FTAs with 26 trading partners, mainly with respect to agricultura l products, and 257 conventional 
TRQs, including WTO TRQs, and about 120 tariff lines for TRQs providing autonomous access. The 
EU adopted regulations on the apportionment of WTO TRQs quotas between the EU and the 
United  Kingdom, in anticipation of the lat ter's eventual withdrawal from the EU. In this regard, 
negotiations under Article XXVIII of the GATT 1994 were initiated.  
16. The EU continues to have several preferential regimes, both reciprocal and unilateral, which 
offer preferential duties upon importati on into the EU. Based on the 2019 preferential duty rates, 
most partners or recipients receive duty -free access on a large percentage of their exports to the 
EU. Like the situation with MFN tariffs, access was greater on non -agricultural goods than on 
agricultural goods. In general, the percentage of duty -free lines increased since the last Review, due 
to the staged implementation of some agreements and new improved agreements with certain 
partners. At the same time, the simple average tariff rate slightly decreased for many agreements 
for the same reason. The share of imports under preferential tariff regimes in total EU imports is 
relatively low, with unilateral preferential regimes accounting for 3.8% of total imports in 2018, and 
preferential FTAs accoun ting for 13%.  
17. There were several important legislative developments with respect to the EU's value -added 
tax (VAT) regime. For example, one set of amendments to the VAT Directive of 2006, which aims to 
simplify VAT for e -commerce transactions, entails the  removal of the VAT threshold of EUR 22, which 
means that all commercial goods entering the EU will be subject to VAT from 1 January 2021. The 
amendments also introduce two alternative VAT collection mechanisms.  
18. The EU continues to apply several prohibiti ons, restrictions and licensing requirements on 
imports which have increased in number over the review period. New or expanded prohibitions or 
restrictions on imports that took effect during the review period concerned measures on mercury, 
invasive alien s pecies, certain persistent organic pollutants and cultural goods, for example. 
A directive on the single use of plastics adopted in 2019 must be transposed by member States by 
July 2021. A regulation on conflict minerals, adopted in 2017, requires importer s of tin, tungsten, 
tantalum and gold to comply with certain supply chain due diligence requirements as of 
1 January  2021.  
19. The EU basic anti -dumping and anti -subsidy regulations were amended by two new 
regulations. The first, adopted in 2017, allows for t he use of alternative methods of determining 
normal value where there are state -induced distortions in the exporting country. The amendments 
made by the second regulation, adopted in 2018 as part of a comprehensive modernization of 
EU trade remedy legislat ion, are more numerous and diverse and concern both procedural aspects, 
such as the duration of provisional measures, and substantive aspects, such as the calculation of an 
injury margin. The EU continues to be a significant user of trade remedies , althoug h the number of 
new anti-dumping and anti -subsidy initiations steadily declined between 2016  and 2018 . The steel 
surveillance measure continued to be in place, followed by the introduction of the steel safeguard 
measure replacing this measure for certain s teel categories in 2018 -19. A similar surveillance 
measure on aluminium was put in place  in 2018,  citing the vulnerable position of the EU industry.  
20. The EU does not impose taxes, charges or levies on exports. It maintains prohibitions or 
restrictions on the export of about 11 categories of pro ducts, many of which are applied pursuant to 
international agreements, such as CITES and the Montreal Protocol. The scope of export restrictions 
on mercury was expanded, regulations on certain goods which could be use d for capital punishment, 
torture or other cruel, inhuman or degrading treatment or punishment were replaced and codified 
into a new regulation, and more stringent measures were put in place for raw ivory. A ban on exports 
of certain plastic waste to non -EU countries will apply from 2021. The EU continues to regulate the 
export of certain products, pursuant to its export control legislation on dual -use goods. The 
EU export control regulation was amended twice during the review period, mainly to update the 
annexes to reflect certain changes to the international agreements on which it is based. Based on a 
proposal made by the Commission in 2016, a legislative process is under way to upgrade the 
EU's export control regime.  WT/TPR/S/395 • European Union  
 
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  21. Export or trade promotion activities are generally within the realms of the EU member States. 
In addition, most member States also have some form of officially supported export financing, 
credits, insurance or guarantees. The EU has several provisions on export credit, insurance and 
guarantee  instruments but does not have any all -encompassing legislation, except on short -term 
official export credits. EU rules on capital requirements were amended during the review period to 
provide that EU financial institutions subject to these rules are no lo nger required to include export 
credits in their leverage ratios.  
22. The EU provides incentives in the form of subsidies and state aid, granted both out of the 
EU budget and by member States. At the EU level, the two largest areas of expenditure during the 
2017-18 period  were agriculture, and structural operations , mainly through t he European  Structural 
and Investment Funds (ESIF). The ESIF amount to EUR 644 billion during 2014 -20, of which 71.6% 
is EU financing (EUR 461 billion) and 28.4% is EU co-financing ( EUR 183 billion) . The ESIF comprise 
six funds: the European Regional Development Fund (43.3% of the total ESIF budget); the European 
Agricultural Fund for Rural Development (23.5%); the European Social Fund(18.7%); the Cohesion 
Fund (11.6%); the European Maritime and Fisheries Fund(2.0%); and the Youth Employment 
Initiative (1%). The European Commission is currently evaluating most of the state aid rules in order 
to take stock of the results of the reforms implemented since 2012 pursuant to th e State Aid 
Modernization initiative. The total amount of s tate aid (excluding transport and agriculture) provided 
by member States increased from EUR 91 billion in 2014 to almost EUR 111 billion in 2017, largely 
due to an increase in aid for environmental  protection (including energy saving).  
23. Some important changes were made during the review period to the basic legislative 
framework regarding technical requirements, standards, conformity assessment and accreditation . 
Firstly, a new regulation was adopted in 2019 which aims to improve the application of the principle 
of the mutual recognition of goods. It provides, in particular, that member States that use existing 
technical regulations to restrict market access for products lawfully marketed in another me mber 
State must justify their position with technical and scientific evidence , and must grant the economic 
operators affected an opportunity to provide comments. Secondly, another regulation adopted in 
2019 aims to enhance cooperation between national mark et surveillance authorities by providing for 
information -sharing mechanisms between them regarding illegal products and ongoing 
investigations.  
24. Regarding sanitary and phytosanitary measures, a new regulation was adopted in 2017 on 
official controls on pro ducts of animal origin intended for human consumption.  It includes rules for 
the performance of official controls and other control activities by the competent authorities of the 
member States, sets out the requirements to be fulfilled for the entry into t he EU of consignments 
of animals and goods from third countries, and empowers the Commission to adopt delegated acts 
concerning those requirements. The Animal Health Law of 2016 is to become applicable on 
21 April 2021, and the Plant Health Law of 2016 on 14 December 2019, except for certain provisions 
relating to a phytosanitary certificate for exports.  
25.  In the area of competition policy, the main legislative development during the review period 
was the adoption of a directive that strengthens the compete nces of national competition authorities 
in the enforcement of EU competition law. The Commission commenced the review of the Vertical 
Block Exemption Regulation, which will expire in May 2022. In relation to anti -competitive 
agreements and abuse of domina nt position, the Commission adopted several decisions concerning 
large firms in the digital services market, and took action to ensure competition in gas supply 
markets. It also adopted several important decisions in merger cases.  
26. One of the main developments in the area of government procurement was the adoption by 
the Commission, in October 2017, of a public procurement strategy which aims at further improving 
EU public procurement practices by working with public authorities and other stakeholders and which 
includes three initiatives: (i) a mechanism for large infrastructure projects, to provide clarity and 
guidance to public authorities on public procurement; (ii) a recommendation to professionalize public 
buyers; and (iii) a con sultation on guidance on public procurement of innovation. To harmonize 
procedures and processes, the Commission introduced the European Single Procurement Document.  
27. Regarding intellectual property, several legislative measures were put in place during the  
review period , notably with respect to copyrights and related rights: (i) the Directive on copyright 
in the Digital Single Market; (ii) the Directive on television and radio programmes; (iii) the Regulation 
on cross -border portability of online content se rvices in the internal market; and (iv) the Directive WT/TPR/S/395 • European Union  
 
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  and Regulation to implement the Marrakesh Treaty, aimed at giving blind and visually impaired or 
otherwise print -disabled people better access to printed materials. The unitary patent package has 
not ye t entered into force. In May 2019, the EU adopted amendments to its rules on supplementary 
protection certificates for medicinal products. Various measures were taken during the review period 
to implement substantive reforms to EU trademark legislation, ba sed on a regulation modernizing 
the EU legal framework for EU trademarks and a directive further harmonizing national trademark 
laws, adopted in 2015. Given the importance of geographical indications (GI) for the EU's external 
trade, the EU has sought to i nclude a comprehensive section on GI protection for agricultural 
products, in addition to wines and spirits, in the more recent generation of FTAs. Regarding 
undisclosed information, nearly all EU member States adopted legislation to implement the Trade 
Secrets Directive adopted in June 2016.  
28. In agriculture, the 2013 reforms of the Common Agricultural Policy (CAP) have been fully 
applied since 2015, and the structure of the agricultural policies has remained the same: the 
European Agriculture Guarantee Fun d (EAGF) covers direct payments and market measures (Pillar  I) 
and the European Agricultural Fund for Rural Development (EAFRD) finances the EU contribution to 
rural development programmes (Pillar II). The main legislative change during the review period w as 
the Omnibus Agricultural Provisions Regulation, adopted in December 2017,  which made certain 
technical amendments to the four Basic Acts of the CAP on direct payments, rural development, 
common market organization, and horizontal regulation (financing, management and monitoring of 
the CAP). Legislative proposals for the reform of the CAP beyond 2020 were submitted by the 
Commission in 2018 and are currently under discussion. These include proposals relating to the 
general and specific objectives to be pu rsued through support funded under the EAGF and the 
EAFRD. No export subsidies were provided during the review period , and, as part of the broader 
revised EU -28 Schedule certification exercise, the EU submitted the changes to its 
WTO commitments to revise its export subsidy commitment levels pursuant to the Nairobi Ministerial 
Conference Decision.  There were no substantial changes during the review period regarding market 
access for imports of agricultural products into the EU.  
29. Regarding f isheries , there were no significant changes during the review period in the 
management of fisheries under the reformed Common Fisheries Policy  (CFP), which has been in 
effect since 2014 . The Commission conducted a comprehensive assessment of the implementation 
of the CFP, considering the CFP's objective of restoring and maintaining fish stocks at sustainable 
levels by 2020. While tariff protection on an MFN basis is relatively high, the EU grants preferences 
on a reciprocal or unilateral basis, to major fishery suppliers. T he EU adopted a new regulation in 
December 2017 on the sustainable management of external fishing fleets. Regarding international 
cooperation, it signed ocean partnership agreements with China and Canada and, together with nine 
other countries, signed an A greement to Prevent Unregulated Commercial Fishing on the High Seas 
in the Central Arctic Ocean. As at October 2019, the EU had 12 Sustainable Fisheries Partnerships 
Agreements with partner countries, in addition to the Northern Agreements with Norway, Ice land 
and the Faroe Islands.  
30. Key objectives of the EU's energy policy , as defined in the Energy Union Package adopted in 
2015, are: improving security of energy supply; completing the internal energy market; boosting 
energy efficiency; decarboni zing the economy and becoming the world leader in renewable energy ; 
and promoting research, innovation and competitiveness.  New legislation adopted during the review 
period relating to these objectives includes new rules on the security of gas supply and el ectricity 
risk preparedness, a revision of the gas Directive, a regulation and a directive on the internal market 
for electricity, amendments to the Energy Efficiency Directive, and a directive on the promotion of 
the use of energy from renewable sources. The 2030 Climate and Energy Policy Framework, adopted 
in 2014,  has the following targets for 2030 : reduce greenhouse gas emissions domestically by at 
least 40% compared to 1990 levels; reach a share of at least 32% in renewable energy; and increase 
energy efficiency by at least 32.5% at EU  level.  In 2018 -19, the EU adopted a new comprehensive 
legislative framework for energy and climate change policies.  
31. With respect to manufacturing, apart from developments relating to specific sectors 
(automobiles, chemica ls, and steel) a notable development during the review period was the growing 
interest in the role of industrial policy. In September 2017, the EU formulated a renewed Industrial 
Policy Strategy, "Investing in a smart, innovative and sustainable industry",  which aims to integrate 
all existing and new horizontal and sector -specific industrial policy initiatives into one comprehensive 
strategy. T he Strategy  proposed measures relating to : cybersecurity; the free flow of non -personal 
data; the circular economy;  moderniz ation of  the intellectual property rights framework ; WT/TPR/S/395 • European Union  
 
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  improvement of the functioning of public procurement markets;  extension of the s kills agenda  to 
new key industry sectors ; sustainable finance; a balanced and progressive trade policy and a 
EU framework for the screening of FDI; the secure, sustainable and affordable supply of critical raw 
materials; clean, competitive and connected mobility; and the exploitation of key enabling 
technologies. Many of the measures envisaged in this Strategy were ad opted in 2018 -19. In 
March  2019, the European Council invited the Commission to present, by the end of 2019, a long 
term-vision for the EU's industrial future.  
32. In financial services, regulatory developments during the review period fell into four 
categori es. Firstly, the EU took steps to reduce risk and enhance the resilience of the banking sector. 
In May 2019, it adopted a banking reform package which amends core provisions of the Single 
Rulebook, namely the Capital Requirements Regulation and Directive a nd the Bank Recovery 
Resolution Directive, considering international standards. The EU also introduced new measures 
regarding non -performing loans, which have been on a declining trend in recent years. Secondly, 
the first two pillars of the Banking Union ( the Single Supervisory Mechanism and the Single 
Resolution Mechanism) are operational; the third pillar (the European Deposit Insurance Scheme), 
has yet to be established. Thirdly, most of the legislative proposals submitted by the Commission 
on core aspec ts of the Capital Markets Union, which aims to develop deeper and more integrated 
capital markets across the EU, were adopted during the review period. Finally, the Commission 
issued a communication, setting out its overall approach to equivalence in the a rea of financial 
services, and adopted several equivalence decisions with respect to third countries.  
33. Regarding construction services, a sector being examined for the first time, the EU is the 
world's largest trader of construction services  (intra - and ex tra-EU trade), and took several steps in 
recent years towards regulatory simplification and improving the internal market for the construction 
sector.  The main legislation applicable to this sector is the 2006 Services Directive. Several other 
EU rules are  also relevant to the construction sector, for example the 1996 Directive on the posting 
of workers in the framework of the provision of services, which was amended in 2018. One recent 
development is a proposed Directive and Regulation on a services e -card to enhance cooperation in 
member States but it is currently on hold. The EU has taken GATS commitments for cross -border 
services in the construction sector and also has made generally improved commitments in its FTAs. 
According to information from the OEC D on services' trade restrictiveness, EU member States were 
ranked relatively open compared to OECD peers for construction services.  
34. During the review period, the EU adopted legislative measures under the first pillar of the 
Digital Single Market (DSM) St rategy launched in 2015 that address different types of barriers to 
the growth of cross -border e -commerce. These measures deal with: cross -border portability of online 
content subscriptions; cooperation between national consumer protection agencies; VAT as pects of 
e-commerce; unjustified geoblocking; cross -border parcel delivery services; copyright in the DSM; 
copyright and related rights applicable to certain online transmissions of broadcasting organizations 
and retransmissions of television and radio pro grammes; contracts for the supply of digital content 
and services; and contracts for the sale of goods.  
35. The second pillar of the DSM Strategy resulted in a major reform of EU rules on 
telecommunications infrastructure and services markets with the adoptio n, in December 2018, of a 
new European Electronic Communications Code (recast) (EECC). The EECC, which member States 
are required to transpose by 21 December 2020, amends the four Directives that constitute the 
current EU telecoms regulatory framework and integrates them into a single legal instrument. 
It expands the scope of application of EU telecoms regulation in various respects, in line with the 
principle of technological neutrality and to keep pace with technological developments. It aims to 
contribut e to the creation of the additional capacity in high -speed broadband networks necessary to 
achieve the strategic Internet connectivity objectives set by the Commission in 2016. The EECC also 
contains provisions aimed at increasing the coordination and cohe rence of radio spectrum 
management, significantly alters the scope of universal service obligations, strengthens consumer 
protection rights, and reinforces the role of national regulatory authorities. The EECC was 
accompanied by the adoption of new rules o n the role of the Body of European Regulators for 
Telecommunications.  
36. Other measures adopted under the second pillar of the DSM Strategy, include a non -binding 
Commission Recommendation of 1 March 2018 on measures to effectively tackle illegal content 
online and a Regulation, adopted in June 2019, on rules to improve the fairness and transparency 
of online platforms. This Regulation aims to address potential friction arising from the growing WT/TPR/S/395 • European Union  
 
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  dependence of business users on providers of intermediation servi ces. In June 2019, the 
EU Cybersecurity Act entered into force. It reinforces the role of the EU Agency for Cybersecurity, 
and establishes a European cybersecurity certification framework.  
37. In audiovisual services, the Audiovisual Media Services Directive was the subject of a 
comprehensive set of amendments in 2018. The main changes reinforce the country of origin 
principle, reinforce the existing rules on hate speech and prohibit provocations to commit terrorist 
acts, introduce additional protections for c hildren, extend certain rules for audiovisual media services 
to video -sharing platforms, establish rules on the promotion of European content in respect of 
on-demand audiovisual service providers, introduce more flexibility regarding restrictions on 
televi sion advertising, and require member States to establish national regulatory authorities or 
bodies.  
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  1  ECONOMIC ENVIRONMENT  
1.1  Main Features of the Economy  
1.1.  In 2018, EU's gross domestic product (GDP) stood at EUR 15.8 trillion, up from EUR 14.7 trillion 
in 2015. Services are the main contributors to GDP, accounting for nearly three quarters of the 
output. Cyprus, Luxembourg, and Malta are the most services -oriented economies, with over 80% 
of their total output  (Table 1.1). Industry accounts for some 25% of GDP, also with noticeable 
disparities among member States. Ireland, Poland, the Czech Republic, and the Slovak Republic  
record the highest share of industry in their national output.  
1.2.  The EU is the world's la rgest trading bloc and the world's largest trader of manufactured goods 
and services.1 Intra-EU trade is an important part of its member States' trade. More than two thirds 
of EU countries' total trade is with other EU member States.  
1.2  Recent Economic Devel opments  
1.3.  The EU's economy has moved from recovery mode to an upturn in recent years. Since 2015, 
GDP growth rates averaged more than 2%. However, increasing global and domestic uncertainties, 
trade tensions between major global trading entities and  the pros pect of the United Kingdom leaving 
the EU , together with weakness in the manufacturing sector, led to a slowdown in the second half 
of 2018.2  
1.4.  During the review period, from 2017 to 2018 (the latest year for which data are available), 
economic growth was r elatively strong. All member States contributed to the strong expansion, 
albeit to different degrees (Table 1.1). Among the five largest economies, only Spain recorded an 
annual growth rate over 2% in 2018. Italy had the lowest growth performance (0.8%). I reland, 
Malta and Poland grew by more than 5%. According to the European Commission (the Commission), 
the recent economic performance suggests an ongoing economic convergence, as higher growth 
rates are mostly recorded in member States with lower levels of  GDP per capita.3 
Table 1.1 Selected indicators, 2015 -18 
  GDP at 
current 
prices 
(2018) 
EUR 
billion  Real GDP growth (%)  GDP per capita 
(2018)  Share in gross value added, % 
(2018)  
  2015  2016  2017  2018  EUR at 
current 
prices  PPSa Agri-
culture, 
forestry 
and 
fishing  Industryb Services  
EU-28 15,898.3  2.3 2.0 2.6 2.0 30,960  30,960  1.6 24.6 73.7 
Austria  385.7  1.0 2.1 2.5 2.4 43,640  39,320  1.3 28.8 69.9 
Belgium  459.8  2.0 1.5 2.0 1.5 40,320  36,470  0.6 21.4 78.0 
Bulgaria  56.1 4.0 3.8 3.5 3.1 7,980c 15,810c 3.9 25.8 70.3 
Croatia  51.6 2.4 3.5 3.1 2.6 12,560  19,450  3.5 24.8 71.8 
Cyprus  21.1c 3.4 6.7 4.4 4.1c 24,290c 27,280c 2.3c 14.1c 83.6c 
Czech Republic  207.8  5.3 2.5 4.4 3.0 19,550  28,150  2.2 35.8 62.0 
Denmark  298.3  2.3 2.4 2.3 1.5 51,480  39,050  1.2 23.8 75.0 
Estonia  26.0 1.8 2.6 5.7 4.8 19,740  25,510  3.1 27.7 69.2 
Finland  234.5  0.6 2.6 3.1 1.7 42,500  34,300  2.8 28.4 68.8 
France  2,353.1c 1.1 1.1 2.3c 1.7c 34,980c 31,980c 1.8c 19.0c 79.2c 
Germany  3,344.4  1.7 2.2 2.5 1.5 40,340  37,600  0.9 30.5 68.7 
Greecec 184.7  -0.4 -0.2 1.5 1.9 17,220  20,960  4.3 17.5 78.2 
Hungary  133.8  3.8 2.2 4.3 5.1 13,690  22,010  4.2 30.1 65.7 
                                                
1 European Commission, the economy . Viewed at: https://europa.eu/european -union/about -
eu/figures/economy_en . 
2 European Commission, European Economic Forecast (spring and summer editions) . Viewed at: 
https://ec.euro pa.eu/info/sites/info/files/economy -finance/ip108_en.pdf , and 
https://ec.europa.eu/info/sites/info/files/economy -finance/ip102_en.pdf . 
3 European Commission, Annual Gro wth Survey 2019: For a stronger Europe in the face of global 
uncertainty.  Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1547650919951 &uri=CELEX%3A52018DC0770 . WT/TPR/S/395 • European Union  
 
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    GDP at 
current 
prices 
(2018) 
EUR 
billion  Real GDP growth (%)  GDP per capita 
(2018)  Share in gross value added, % 
(2018)  
  2015  2016  2017  2018  EUR at 
current 
prices  PPSa Agri-
culture, 
forestry 
and 
fishing  Industryb Services  
Ireland  324.0  25.2 3.7 8.1 8.2 66,670  58,840  1.0 39.3 59.7 
Italy 1,765.4  0.8 1.3 1.7 0.8 29,220  29,630  2.2 23.9 74.0 
Latvia  29.2 3.3 1.8 3.8 4.6 15,130  21,470  4.1 22.5 73.4 
Lithuania  45.3 2.0 2.6 4.2 3.6 16,160  25,010  3.2 28.4 68.4 
Luxembourg  60.1 4.3 4.6 1.8 3.1 98,640  80,130  0.3 13.0 86.7 
Malta  12.3 10.8 5.7 6.7 6.8 25,560  30,250  1.0 13.7 85.3 
Netherlands  774.0c 2.0 2.2 2.9 2.6c 44,920c 39,890c 1.8c 20.0c 78.1c 
Poland  496.4  3.8 3.1 4.9 5.1 12,920  21,940  2.4 32.7 64.9 
Portugal  203.9c 1.8 2.0 3.5 2.4c 19,830c 23,660c 2.4c 22.2c 75.5c 
Romania  202.9c 3.9 4.8 7.1 4.0c 10,420c 19,980c 4.8c 32.0c 63.2c 
Slovak Republic  89.7 4.8 2.1 3.0 4.0 16,470  23,900  2.6 33.6 63.8 
Slovenia  45.8 2.2 3.1 4.8 4.1 22,080  26,890  2.4 32.7 64.9 
Spain  1,202.2c 3.8 3.0 2.9c 2.4c 25,730c 28,130c 3.1c 22.1c 74.8c 
Sweden  471.2  4.4 2.4 2.4 2.3 46,310  37,710  1.6 25.5 73.0 
United Kingdom  2,419.2  2.4 1.9 1.9 1.4 36,410  32,590  0.7 19.6 79.7 
a In euro, measured on the basis of purchasing power standards (PPS).  
b Including construction.  
c Provisional.  
Source:  Eurostat, National Accounts (including GDP), (nama_10_gdp), (nama_10_pc), and (nama_10_a10) . 
Viewed at: https://ec.europa.eu/eurostat/web/national -accounts/data/database .  
1.5.  While domestic demand's contribution to growth remained important, buoyant external trade 
played an important part in the 2017 acceleration (Chart 1.1). Exports growth on average surpassed 
imports growth.  
1.6.  Economic impulses from abroad were particularly ex planatory of Germany's economic 
performance in 2017. In contrast, the expansion in France, Italy and the United Kingdom was largely 
internally driven, and marginally supported by gradual labour market and tax reforms in France. 
Both internal and external f actors contributed to growth in Spain. In Italy, economic performance 
continued to be affected by its still vulnerable financial sector and weak lending. EU -wide, strong 
jobs creation supported household income and consumer spending, while stronger confide nce and 
improved profit margins supported business investments. At the same time, according to the 
Commission, strong demand from trading partners and progress in structural reforms helped to 
improve competitiveness and support export growth.4  
1.7.  GDP growth slowed in 2018, as the German economy contracted in 2018 Q3. The downturn in 
the automotive market contributed to the slowdown. This was partly the consequence of the 
introduction of new emissions standards5, the Worldwide Harmonized Light Vehicles Test Pr ocedure, 
with higher requirements for the reduction of CO 2 emissions, and the so -called Dieselgate scandal 
disclosed in September 2015. The negative effects were also felt in EU  countries having industrial 
connections with the German automotive industry. F urthermore, foreign demand declined markedly 
in 2018, on the back of global trade tensions and uncertainties in connection with the 
United  Kingdom's withdrawal from the EU . Weaker global trade growth, due to escalating trade 
tensions around the world and e levated political tensions, affected business confidence in 2018.  
1.8.  In the context of fading export performance, domestic demand remained the bedrock of the 
EU's economy. Improving labour markets and low interest rates continued to boost incomes and 
private consumption. Investments returned to their pre -crisis level in 2017, and gross fixed capital 
formation continued to firm up in 2018, sustained by buoyant business sentiment, rising profits and 
favourable financing conditions (Chart 1.2). This is also partl y attributed to the Investment Plan for 
                                                
4 European Commission, Annual Growth Survey 2019 . 
5 European Commission , European Economic Forecast - Spring 2019 . Viewed at: 
https://ec.europ a.eu/info/sites/info/files/economy -finance/ip102_en.pdf . WT/TPR/S/395 • European Union  
 
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  Europe, launched in November 2014. The Plan was set to inject EUR  500 billion in additional 
investment across the EU, create 1.4  million jobs, and add 1.3% to the EU's GDP by 2020.  
Chart 1.1 Contribution to GDP growth, 2015 -18 
(Percentage point)  
 
Source:  Eurostat, National Accounts (including GDP), (nama_10_gdp). Viewed at: 
https://ec.europa.eu/eurostat/web/national -accounts/data/database .  
Chart 1.2 Gross fixed capital formation (investments)  
(Percen tage change in the level of investment compared to 2008, at chained linked volume)  
 
Source:  Eurostat , National Accounts (including GDP), (nama_10_gdp) . Viewed at: 
https://ec .europa.eu/eurostat/web/national -accounts/data/database .  
-1.00.01.02.03.0
2015 2016 2017 2018Chart 1.1 Contribution to GDP growth, 2015 -18
(Percentage point)
Eurostat, National Accounts (including GDP), (nama_10_gdp). 
Viewed at: https://ec.europa.eu/eurostat/web/national -accounts/data/database. Source:GDP growthConsumption expenditure: Household and NPISH
Gross fixed capital formation
Other domestic demand
Net exports of goods and services
0.0%
-11.5%-11.5%-10.0%
-12.1%
-13.2%-10.9%-6.6%-3.5%-0.2%2.3%
-16%-14%-12%-10%-8%-6%-4%-2%0%2%4%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Chart 1.2 Gross fixed capital formation (investments)
(%age change in the level of investment compared to 2008 at chained linked volume)
Source: Eurostat , National Accounts (including GDP), (nama_10_gdp) . 
Viewed at: https://ec.europa.eu/eurostat/web/national -accounts/data/database. WT/TPR/S/395 • European Union  
 
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  1.9.  In the first quarter of 2019, GDP growth was estimated at 0.5%, driven by domestic demand 
and, in particular, private consumption and investment.6 This represented the 24th consecutive 
quarter of ex pansion. In Germany, growth turned positive after two quarters of either contraction 
or stagnation, and Italy left the technical recession in which it had been over the second half of 
2018. Broadly, this performance reflects a number of factors including b ooming construction 
activities, particularly in Germany; a rebound in car sales following the decrease in the second half 
of 2018; and the substantial increase in goods exports to the United Kingdom, in preparation for the 
original Brexit date.7  
1.10.   The relat ively strong growth in 2019 -Q1 proved to be temporary, as it was followed by 
renewed weaknesses. Most recent data from the summer edition of the European Economic Forecast 
suggests that, at mid -year 2019, the EU's economy showed resilience regarding domest ic demand, 
but export -oriented activities were subdued, reflecting persistent policy uncertainties and weakness 
in global trade growth, as trade tensions had recently escalated.  
1.11.   Economic growth in the EU led to a noticeable improvement in the labour marke t situation 
everywhere, which was accompanied by a significant drop in unemployment rates in all member 
States. The rate at the EU level fell from 9.4% in 2015 to 6.8% in 2018. However, significant 
disparities persisted, with rates ranging from 19.3% in Gr eece to 2.2% in the Czech Republic 
(Table  A1.1). While still too high in a number of member States, unemployment is at its lowest level 
EU-wide in a decade.  
1.12.   Inflation, as measured by the Harmonised Index of Consumer Prices (HICP), followed an 
increasing t rajectory from 0.1% in 2015 and 0.2% in 2016, to 1.7 in 2017, before culminating at 
1.9% in 2018. This development was mainly due to energy price effects. Wage growth does not 
seem to have resulted in inflationary pressure.8 
1.2.1   Balance of payments  
1.13.   The EU's cu rrent account remained in surplus during the review period. As a percentage of 
GDP, the surplus remained stable, at 1.3% in 2017 and 2018. It increased from 0.9% in 2015 to 
1.4% in 2016. Current account imbalances continued within the EU during the review period, but to 
a lesser extent than in 2008. In recent years, EU countries with high and persistent current account 
deficits (mainly Portugal and Spain) saw noticeable improvement, reflecting moderated domestic 
demand and more competitive economies. At the  same time, countries such as Germany, the 
Netherlands and Denmark continued to post elevated current account surpluses (Chart  1.3 and 
Table  A1.1).  
                                                
6 European Commission, Eurostat online database . Viewed at: 
http://ec.europa.eu/eurostat/web/main/home . 
7 European Commission, European Economic Forecast -Summer 2019 (Interim) . Viewed at: 
https://ec.europa.eu/info/sites/info/fi les/economy -finance/ip108_en.pdf . 
8 European Commission, European Economic Forecast -Summer 2019 (Interim) . WT/TPR/S/395 • European Union  
 
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  Chart 1.3 Current account balance as % of GDP  
 
Note:  EU-28 vis-à-vis extra-EU-28. Each member State with the rest of the world (including other 
EU members).  
a The average is for the 2015-18 period.  
Source:  Eurostat, Balance of Payments (bop_gdp6_q).  Viewed at: 
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database .  
1.2.2   Fiscal governance and performance  
1.14.   On fiscal governance, significant progress was made in r ecent years, through the "Six  Pack" 
and "Two Pack" regulations, to ensure that the EU's public finances are sound, sustainable, and 
capable of absorbing future shocks.9 In 2018, only Spain was in the Excessive Deficit Procedure 
under the Stability and Grow th Pact, down from 24 member States in 2011. On 14  June 2019, the 
Procedure was abrogated for Spain. The Commission also addressed a warning to Hungary and 
Romania that a significant deviation was observed in 2018, and invited the Council to recommend 
they correct it.10 The Commission also adopted reports for Belgium, France, Italy and Cyprus, in 
which it reviews their compliance with the deficit and debt criteria under Article 126(3) of the Treaty 
on the Functioning of the European Union (TFEU).  
1.15.   The Commis sion warned Belgium about its public finances, particularly the high level of its 
debt, which has not been significantly reduced. However, it did not propose to open an Excessive 
Deficit Procedure on the country. With respect to Italy, the Commission's rep ort examined the 
budgetary outturn in 2018 and the fiscal forecasts for 2019 and 2020, and concluded that a 
Procedure was warranted. However, on 1 July, the Italian Government adopted its mid -year budget 
for 2019 and a decree -law, which included a correcti on for 2019 amounting to EUR  7.6 billion, or 
0.42% of GDP in nominal terms. In addition, the Italian Government reiterated its commitment to 
achieving a structural improvement in 2020, notably through, inter alia , a new spending review and 
revision of tax expenditures. Consequently, the Commission concluded that a Procedure is no longer 
warranted for Italy.11 
1.16.   There are ongoing efforts to rationalize expenditures by shifting resources from the common 
agricultural and cohesion policies to areas such as researc h and innovation, young people, the digital 
economy, migration, and climate objectives. There are also other tax -related developments at the 
                                                
9 See WTO document WT/TPR/S/317/Rev.1, 21 October 2015, for information on the Six Pack and 
Two Pack regulations.  
10 European Commission, Excessive d eficit procedures – overview . Viewed at: 
https://ec.europa.eu/info/business -economy -euro/economic -and-fiscal-policy -coordination/eu -economic -
governance -monitoring -prevention -correction/stability -and-growth -pact/corrective -arm-excessive -deficit-
procedure/excessive -deficit -procedures -overview_en . 
11 European Commission, Commission concludes that an Excessive Deficit Procedure is no longer 
warranted for Italy at this stage . Viewed at: https://europa.eu/rapid/press -release_IP -19-3569_en.htm . 
-8.0%-6.0%-4.0%-2.0%0.0%2.0%4.0%6.0%8.0%10.0%12.0%EU-28AustriaBelgiumBulgariaCroatiaCyprusCzech RepublicDenmarkEstoniaFinlandFranceGermanyGreeceHungaryIrelandItalyLatviaLithuaniaLuxembourgMaltaNetherlandsPolandPortugalRomaniaSlovak RepublicSloveniaSpainSwedenUnited Kingdom2015-2018
2018Chart 1.3 C urrent account balance as % of GDP
Eurostat, Balance of Payments (bop_gdp6_q). Viewed at:
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database. Source:EU-28 vis -à-vis extra EU -28.  Each member State with the rest of the world (inclduing other EU members).  Note
The average is for the 2015 -18 period . aaWT/TPR/S/395 • European Union  
 
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  EU level and in some member States. The proposal to apply a rate of 3% to the new Common 
Consolidated Corporate Tax  Base (CCCTB) seems to have beneficial features, as it reduces 
opportunities to shift profits within the EU. According to the International Monetary Fund (IMF), tax 
competition remains an issue. Proposals for a "digital services tax" have been suspended un til 2020. 
However, some member States, including Austria, France, Italy, and Spain, have taken steps for 
their own versions of such a tax.12 
1.17.   During the review period, the improvement in public deficit was mainly attributed to 
favourable cyclical conditions,  notably increased revenues, supported by higher economic growth 
and lower interest payments due to historically low interest rates. Government deficit decreased 
steadily from 2.4% in 2015 to 0.7% in 2018 (Table  A1.1 and Chart 1.4). However, as expenditure  
efforts seemed to have weakened in 2018 and 2019 in most of the member States, assuming full 
implementation by member States of their budget plans, the EU's  aggregate deficit is projected to 
rise to 0.9% in 2019, before decreasing in the following years ( 0.4% in 2022).13 Government debt 
is also on a downward path. The ratio of government debt to GDP fell from 84.9% in 2015 to 80.4% 
in 2018.  
Chart 1.4 General government deficit/surplus as % of GDP  
 
a The average is for the 2015 -18 period.  
Source:  Eurostat, General government deficit/surplus (tec00127).  Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset= tec00127&lang=en . 
1.2.3   Monetary and exchange rate developments  
1.18.   The European Central Bank (ECB) and the national central banks of the euro -area countries, 
which together make up the Eurosystem, are responsible for monetary policy for the euro area. 
Monetary deci sions in the euro area can only be taken by the Governing Council of the ECB, made 
up of the governors of the national central banks of the euro -area countries (the members of the 
ECB's executive board).  
1.19.   The ECB's mission is to ensure price stability within the euro area. It aims to keep inflation 
below, but close to, 2% over the medium term, which is considered optimal for promoting growth 
and employment.  
                                                
12 IMF, Euro Area Policies: 2019 Article IV Consultation . Viewed at: 
https://www.imf.org/en/Publications/CR/Issues/2019/07/10/Euro -Area-Policies -2019-Article -IV-Consultation -
Press -Release -Staff-Report -and-Statement -by-47101 . 
13 European Commission, The 2019 Stability & Converg ence Programmes . Viewed at: 
https://ec.europa.eu/info/sites/info/files/economy -finance/ip110_en.pdf . 
-5.0%-4.0%-3.0%-2.0%-1.0%0.0%1.0%2.0%3.0%4.0%EU-28AustriaBelgiumBulgariaCroatiaCyprusCzech RepublicDenmarkEstoniaFinlandFranceGermanyGreeceHungaryIrelandItalyLatviaLithuaniaLuxembourgMaltaNetherlandsPolandPortugalRomaniaSlovak RepublicSloveniaSpainSwedenUnited Kingdom
2015-18 2018Chart 1.4 General government deficit/surplus as % of GDP
Eurostat, General government deficit/surplus (tec00127). Viewed at:
http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=tec00127&lang=en.  Source: a
a The average is for the 2015 -18 period.WT/TPR/S/395 • European Union  
 
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  1.20.   Of the 28 member States, 19 are using the euro, 2 have their currencies pegged to the e uro, 
and the remaining 7 have free or managed -floating currencies. The Eurosystem can conduct foreign 
exchange interventions, and holds and manages the euro area's foreign currency reserves. The ECB 
intervened in the foreign exchange market in 2000 and 201 1. The latest ECB intervention, in 2011, 
was a coordinated intervention with other major central banks to weaken the Japanese yen after a 
major earthquake.14 It is also possible for the Economic and Financial Affairs (ECOFIN) Council to 
conclude formal exch ange rate agreements. For EU member States not using the euro, the Exchange 
Rate Mechanism (ERM II) ensures that currency rate fluctuations do not impact economic stability 
by fixing the exchange rate with the euro within set limits. Currently, the ERM II only includes the 
currency of Denmark. The Danish kroner joined the ERM II on 1 January 1999, and observes a 
central rate of 7.46038 to the euro, with a fluctuation band of ±2.25%.15 
1.21.   During the review period, the nominal exchange rate of the euro appreciate d, on average, 
against the US dollar. The same movement was observed in terms of the effective exchange rate 
against its major trading partners' currencies. On average, in 2017 -18, the euro appreciated by 2% 
against a basket of 19 currencies. Furthermore, it appreciated by 4.2% against a basket of currencies 
representing its 38 main trading partners.16 
1.22.   Monetary policy continued to ensure favourable financing conditions and support economic 
expansion during the review period. While the ECB ended its net asset  purchases programme in 
December 2018, the ECB monetary policy remained highly accommodative since the beginning of 
this year, with a new easing package announced in September. The latest measures were considered 
necessary in light of further downward revi sions in the ECB Governing Council's inflation outlook. 
Most notably, the latest package included a 10 basis point (bps) cut in the deposit facility rate (DFR) 
to -0.5%. The interest rate on the main refinancing operations and the rate on the marginal lend ing 
facility remained unchanged, at 0.00% and 0.25%, respectively. In addition, open -ended net asset 
purchases at a pace of EUR 20 billion per month were due to restart from 1 November 2019. The 
duration of the purchases was not set in advance, with the Go verning Council expecting them 
"to end shortly before it starts raising the key ECB interest rates".17  
1.23.   To further improve the borrowing conditions of the euro -area private sector, the forward 
guidance on policy rates was also changed. The new forward guida nce no longer includes the 
date-based leg ("at least through the first half of 2020") and becomes entirely state -based, with a 
first rate hike now linked to a sufficient convergence of the inflation outlook to the ECB's objective 
over the ECB projection ho rizon that should be "consistently reflected in underlying inflation 
dynamics". As a complement to the other monetary policy -easing measures, the modalities of the 
new series of Targeted Long er-Term Refinancing Operations (TLTROs), announced in June 2019, 
were also changed, making it possible for banks to access longer -term funding at lower rates with a 
longer maturity. Finally, it was also decided that a two -tier system for reserve remuneration is be 
introduced in November 2019, in order to safeguard bank -based policy transmission. According to 
this new system, part of banks' holdings of excess liquidity will be exempt from the negative deposit 
facility.  
1.2.4   Outlook  
1.24.   The EU's economic outlook is mainly subject to domestic policy uncertainty and rising 
protection ism in trade and investment. According to the Organization for Economic Co -operation and 
Development (OECD), the United Kingdom's withdrawal from the EU is not a major threat to the 
EU's overall economic performance; however, countries with the closest tra de links to the 
United  Kingdom (e.g. Ireland) could be severely impacted if the United Kingdom left the EU without 
a withdrawal agreement. While the detrimental effect of a "hard" Brexit on the United Kingdom's 
economy would reduce its GDP by some 3.3% by 2020, it would reduce the EU -27 GDP by around 
                                                
14 ECB, Press release: ECB enhances reporting on FX interventions . Viewed at: 
https://www.ecb.europa.eu/press/pr/date/2019/html/ecb.pr190927_1~fcdcb74515.en.html . 
15 European Commission, ERM II – the EU's Exchange Rate Mechan ism. Viewed at: 
https://ec.europa.eu/info/business -economy -euro/euro -area/enlargement -euro-area/introducing -
euro/adoption -fixed-euro-conversion -rate/erm -ii-eus-exchange -rate-mechanism_en . 
16 ECB. Viewed at: http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=120.EXR.A.USD.EUR.SP00.A . 
17 ECB, Monetary policy decisions . Viewed at: 
https://www.ecb.europa.eu/press/pr/date/2019/html/ecb.mp190912~08de50b4d2.en.html . WT/TPR/S/395 • European Union  
 
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  1%.18 According to the Summer 2019 edition of the European Economic Forecast (to be updated in 
November 2019 and February  2020), in spite of global challenges, the EU is expected to continue 
growing in the next two years, with annual growth forecast to slow from 2.0% (1.9% in the euro 
area) in 2018 to 1.4% in 2019 (1.2% in the euro area), as the German economy slipped into negative 
territory in 2019 Q2 and it continued to show signs of weak exports. However, the EU economy is 
set to firm up at 1.6% in 2020 (1.4% in the euro area), as adverse domestic factors are expected 
to fade and economic activity outside the EU to rebound. The labour mark et situation is expected to 
continue improving but at a slower pace.19  
1.25.   Inflation is expected to ease in 2019 (1.5%), driven by low energy prices, before picking up 
slightly in 2020 (1.6%). The core inflation rates are not expected to increase significantly despite 
the positive development in the EU labour markets.  
1.2.5   Main challen ges and policy response  
1.26.   The Europe 2020 Strategy is the EU's agenda for growth and jobs for the current decade. 
It emphasizes smart, sustainable and inclusive growth as a way to overcome the structural 
weaknesses in the economy, improve competitiveness and  productivity, and underpin a sustainable 
social market economy. The final objective is to deliver high levels of employment, productivity and 
social cohesion in the member States, while reducing the impact on the environment. The 
Commission set five  targe ts under the strategy: (i) 75% employment level for people aged 20 -64; 
(ii) 3% of GDP invested in research and development (R&D); (iii) greenhouse gas emissions 20% 
lower than 1990 levels, 20% of energy coming from renewables, and a 20% increase in energy 
efficiency; (iv)  reduction of early school leavers to below 10%, and at least 40% of 30 -34 year -olds 
having completed higher education; and (v) lifting at least 20 million people out of the risk of poverty 
and social exclusion.20 These targets were translat ed into national targets, as defined in the National 
Reform Programmes (NRPs). The NRPs represent the set of policies EU  member States plan to 
implement to promote economic growth and job creation and prevent/correct imbalances.21 
1.27.   Given the decreasing trend  in investments and with the view to creating jobs in the spirit of 
the Europe 2020 Strategy, in 2014, the Investment Plan for Europe of which the Capital Markets 
Union is a main pillar (Section 4.4.1.3), was launched. It aims to reverse the downward trend  of low 
levels of investment and put Europe on the path to economic recovery. The Plan consists of three 
pillars: (i) the European Fund for Strategic Investments (EFSI), which provides an EU  guarantee to 
mobilize private investment. The European Commission  works jointly with the European Investment 
Bank (EIB) on this pillar; (ii) the European Investment Advisory Hub and the European  Investment 
Project Portal, that focus on providing technical assistance and greater visibility of investment 
opportunities for  international investors; and (iii) measures to further improve the EU's investment 
climate by increasing regulatory predictability and eliminating obstacles for investments.  
1.28.   Estimates from the EIB suggest that the EFSI has already supported more than 750 ,000 jobs, 
with the figure set to rise to 1.4 million jobs by 2020 compared to the baseline scenario. In addition, 
calculations show that the Investment  Plan for Europe  has already increased EU GDP by 0.6%, and 
it is set to increase it by 1.3% by 2020.22 
1.29.   At the EU level, structural reforms aim to promote growth and employment in line with the 
Europe 2020 Strategy, while fiscal policies focus on ensuring sustainability of public finances in line 
with the Stability and Growth Pact, and the prevention of exce ssive macroeconomic imbalances. In 
                                                
18 OECD, Economic Surveys – European Union . Viewed at: 
https://www.oecd.org/eco/surveys/European -union -2018-OECD -economic -survey -overview.pdf .  
19 European Commission, European Economic Forecast -Summer 2019.  Viewed at: 
https://ec.europa.eu/info/publications/european -economic -forecast -summer -2019_en . 
20 European Commission, Europe 2020: A European strategy for smart, s ustainable and inclusive 
growth . Viewed at: https://ec.europa.eu/eu2020/pdf/COMPLET%20EN%20BARROSO%20%20%20007%20 -
%20Europe%202020 %20-%20EN%20version.pdf . 
21 European Commission, National Reform Programmes and Stability/Convergence Programmes . Viewed 
at: https://ec.europa.eu/info/business -economy -euro/economic -and-fiscal-policy -coordination/eu -economic -
governance -monit oring-prevention -correction/european -semester/european -semester -timeline/national -
reform -programmes -and-stability -convergence -programmes_en . 
22 European Commission, Juncker Plan exceeds original €315 billion investment target . Viewed at: 
https://ec.europa.eu/commission/news/juncker -plan-exceeds -original -eu315 -billion -investment -target -2018-
jul-18-0_en. WT/TPR/S/395 • European Union  
 
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  recent years, under the European Semester23, the EU made significant progress towards promoting 
structural reforms and ensuring sound fiscal policies in member States.  
1.30.   The reforms and other policy measures led to inclusiv e growth, facilitated the reduction of 
macroeconomic imbalances, better fiscal positions of member States, and reduced debt levels, and 
stimulated high -quality public spending. Furthermore, efforts are ongoing in areas like services, as 
progress was made t owards establishing a Digital Single Market, a Banking Union, a Capital Market 
Union, good quality infrastructure, broadband, energy, transport, and a circular economy, with a 
view to creating new opportunities for inclusive economic growth (Section 4). In  the framework of 
the European Semester, the European Pillar of Social Rights aims to support inclusive economic 
growth, by improving labour market conditions for all EU citizens.24 The recent economic and labour 
market recovery led to a decrease in the num ber of people at risk of poverty or social exclusion. In 
2017, the latest available figures, more than 5 million people exited from the risk of poverty or social 
exclusion. With the current trend, the Commission sees the EU on track to meet the Europe  2020 
target of a 75% employment rate of people aged 20 -64 in 2020. The number of people at risk of 
poverty has dropped considerably.25 However, the risk of poverty or social exclusion remains a 
challenge for groups such as children, people with disabilities and  people with a migrant 
background.26 
1.31.   The relatively positive recent growth performance of the EU economy provides an opportunity 
to focus on certain important long -term challenges  that need to be addressed to  support stronger 
and more inclusive growth. Of particular importance, in this regard, are measures to improve 
productivity and boost investment in order to increase the EU's potential growth, which has fallen 
significantly since the financial crisis. The single market, which is the main asset for spurri ng 
productivity and economic growth, remains fragmented in several areas, such as services, energy 
and the digital economy, and thereby fails to fulfil its potential.27 Measures are also necessary to 
better harness digital technologies to adapt to rapid tec hnological change and to create inclusive 
labour markets to raise living standards and potential growth.28  
1.32.   Similarly, the European Commission's Annual Growth Survey 2019 calls for decisive and 
concerted policy action by the EU and its member States to deli ver on the promise of inclusive and 
sustainable growth, especially in the context of rising global uncertainty, and to increase the 
EU's growth potential and economic and social resilience.29 It identifies the main risks and challenges 
facing the EU as foll ows: 
• persisting vulnerabilities: low productivity growth; persisting income inequality and slow 
reduction in poverty; regional and territorial disparities; high public and private debt; and 
other remaining macroeconomic imbalances, notably within the euro area;  
• short-term challenges: rising protectionism and geo -political tensions affecting trade 
relations; instability in emerging markets; skills mismatches and emerging labour 
shortages in some countries and sectors; migration; slow diffusion of new digital  
                                                
23 The European Semester re fers to a cycle of coordination, through which member States align their 
budgetary and economic policies with the objectives and rules agreed at the EU level.  
24 European Commission, European Pillar of Social Rights: Building a more inclusive and fairer 
European  Union.  Viewed at: https://ec.europa.eu/commission/priorities/deeper -and-fairer -economic -and-
monetary -union/europ ean-pillar-social -rights_en .  
25 European Commission , Annual Growth Survey 2019 . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1547650919951&uri=CELEX%3A52018DC0770 . 
26 Council of the European Union, Joint Employment Report 2019 . Viewed at: 
https://data.consilium.europa.eu/doc/document/ST -6167-2019-INIT/en/pdf . 
27 The European Commission issued a communication in November 2018 on the significant  untapped 
potential of the Single Market. The Single Market in a changing world. A unique asset in need of renewed 
political commitment . Viewed at: https://ec.europa.eu/transparency/regdoc/rep/1/2018/EN/COM -2018-772-
F1-EN-MAIN -PART-1.PDF . See also Copenhagen Economics, Making EU Trade in Services Work for All. 
Enhancing innovation and competitiveness throughout the EU economy. Viewed at: 
https://www.copenhageneconomics.com/publications/publication/making -eu-trade -in-services -work-for-all. 
This study notes (p.8) that "[f]rom a business per spective, the reality of the Single Market for services falls 
short of expectations. The Single Market has on average reduced trade costs by 20 per cent for goods but only 
7 per cent for services. Trade cost reductions have been particularly small for some  of the services sectors that 
account for a large share of EU value added (e.g. wholesale & retail trade and construction)".  
28 OECD, Economic Surveys. European Union , June 2018.  
29 European Commission, Annual Growth Survey 2019 . WT/TPR/S/395 • European Union  
 
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  technologies; gradual withdrawal of central bank stimulus; and loss of reform 
momentum/risks of reform reversals and aggravation of fiscal imbalances; and  
• medium/long -term challenges: tapping the growth potential of digitization; the impacts of 
technologi cal transformations on workers and specific sectors; the impacts of demographic 
changes and the role of migration; mitigation of and adaptation to climate change; and 
sustainable use of natural resources.30  
1.3  Developments in Trade and Investment  
1.3.1   Trends and p atterns in merchandise and services trade  
1.33.   International trade remains an important driver of economic performance in the EU. In 201 8, 
trade in goods and services accounted for about 35% of GDP.31 The EU's economic growth was 
supported by external demand (Ch art 1.1). In addition, the EU's economy plays a key role in the 
global economy, as it is a top market for some 80 economies in the world.32 The EU's share of world 
trade in goods and services remained somewhat stable during the review period, but has been o n a 
declining trend for two decades. Trade in goods and services accounted for 16.7% of world trade in 
2017 and 2018, a decrease from 18.9% in 2008 and 17.1% in 2011.  
1.34.   The EU's merchandise trade (imports and exports) with the rest of the world continued to 
grow in 2017 and 2018. However, exports stagnated slightly between 2015 and 2016 (Table A1.2). 
The merchandise trade surplus turned into a deficit in 2018, mainly driven by the large deficit in 
trade of fuel products, which further widened during the revie w period. However, this was partly 
offset by trade surpluses in machinery and transport equipment, and chemicals.  
1.35.   Regarding the composition of merchandise trade, EU exports were dominated by 
manufactured goods. However, their share decreased steadily from 81.9% in 2016 to 80.4% in 
2018. The leading manufacturing exports continued to be transport equipment and chemicals. The 
share of agricultural products in total exports was somewhat volatile during the review period 
(Chart  1.5 and Table A1.2).  
1.36.   The EU's maj or export destinations remained unchanged during the review period. The 
United  States continued to be the biggest market for exports, accounting for 20.8% of merchandise 
exports in 2018. However, the share dropped slightly from 20.8% in 2016 to 20.0% in 20 17. China 
and Switzerland were, respectively, the second and third largest destinations. Asia  remained the 
largest regional market for EU goods, with a steady growth in exports from 28.7% in 2016 to 29.8% 
in 2018 (Table A1.3 and Chart 1.6).  
1.37.   In terms of mer chandise imports, products are also concentrated in manufactured products 
(64.3% in 2018), dominated by machinery and transport equipment, which account for more than 
half of the total. Imports of fuels (20.8 in 2018) grew significantly during the review p eriod (Chart  1.5 
and Table A1.4)  
1.38.   The top origins of EU's imports continued to be China with a 19.9% share in 2018, followed 
by the United States with 13.6, and the Russian Federation with 8.5% (Chart 1.6 and Table A1.5). 
Imports from China and the United States both decreased over the review period, while those from 
the Russian Federation increased from 7.0% in 2016.  
                                                
30 European Commission, Annual Growth Survey 2019: For a stronger Europe in the face of global 
uncertainty , p. 5.  
31 WTO Secretariat calculations, based on Eurostat, Balance of Payments (bop_eu6_q) and National 
Accounts (including GDP), (nama_10_gdp) . Viewed at: https://ec.europa.eu/eurostat/web/balance -of-
payments/data/database ; and https://ec.eu ropa.eu/eurostat/web/national -accounts/data/database . 
32 European Commission, EU position in world trade . Viewed at: https://ec.europa.eu/trade/policy/eu -
position -in-world -trade/ . WT/TPR/S/395 • European Union  
 
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  Chart 1.5 Composition of merchandise trade, 2015 and 2018  
 
Source : WTO Secretariat calculations, based on Eurostat, International trade in goods . Viewed at: 
https://ec.europa.eu/eurostat/web/international -trade -in-goods/data/database . 
Chart 1.[Prd -EU28]
Composition of merchandise trade, 2015 and 2018
2015 2018
(a)    Exports (f.o.b.)
Other 
manufactures
9.8%
Manufactures
80.7%Iron and steel
1.8%
Chemicals
18.2%Non-
electrical 
machinery
12.1%Electrical 
machines
4.8%Textiles and 
clothing
2.5%
Office and 
telecommunication 
equipment
4.2%Power 
generating 
machinery
3.3%
Total:  EUR 1,790.4 billion Total:  EUR 1,956.4 billion  
(b)    Imports (c.i.f.)
Chemicals
10.8%Transport 
equipment  
7.5%Manufactures
65.7%Textiles and 
clothing 
6.5%
Other 
machinery
11.7%Mining
22.9%Fuels
19.0%
Iron and steel
1.7%
Office and 
telecommunication 
equipment
11.7%Other mining 
3.8%
Office and 
telecommunication 
equipment
11.2%Iron 
and steel
2.0%Other 
mining 
4.1%Other
2.8%
Textiles and clothing
5.9%Agriculture
8.7%
Other semi -
manufactures
5.2%Transport 
equipment  
7.7%Chemicals
10.3%Manufactures
64.3%
Total:   EUR 1,725.2 billion Total:  EUR 1,979.2 billion Manufactures
80.4%
Other 
manufactures
9.6%Other
2.7%Other 
manufactures
10.0%
Mining
6.9%
Chemicals
17.6%
Other 
machinery
12.4%Other semi -
manufactures
6.6%Mining
8.3%Agriculture
7.8%
WTO Secretariat calculations, based on Eurostat, International trade in goods . Viewed at: 
https://ec.europa.eu/eurostat/web/international -trade-in-goods/data/database.Other 
manufactures
10.5%Other semi -
manufactures
6.9%
Other semi -
manufactures
5.4%Transport 
equipment
18.0%
Agriculture
8.0%Other
4.5%Other
3.5%
Mining
24.9%Fuels
20.8%Transport 
equipment
17.0%Power generating 
machinery
3.1%Agriculture
7.9%
Iron and steel
1.9%
Non-electrical 
machinery
12.1%Textiles and 
clothing
2.4%
Office and 
telecommunication 
equipment
4.3%Electrical 
machinery
4.6%
Source:WT/TPR/S/395 • European Union  
 
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  Chart 1.6 Direction of merchandise trade , 2015 and 2018  
 
Source:  WTO Secretariat calculations, based on Eurostat, International trade in goods. Viewed at: 
https://ec.europa.eu/eurostat/web/international -trade -in-goods/data/database . 
1.39.   Intra-EU trade is a key driver of economic performance, as merchandise trade within the bloc 
is by far larger than extra -EU trade (over 60% of total trade). The share of intra -EU trade in total 
trade varies among member State s. For example, in 2018, the Czech  Republic, Hungary, Poland, 
and the Slovak  Republic  had the highest share (over 80%), while Cyprus and the United Kingdom 
exported less than 50% of their merchandise into the EU (Table  A1.6). Regarding imports, except 
the Netherlands, all EU countries sourced over half of their imports from within the Union in 2018.  
Chart 1.[Reg -EU28]
Direction of merchandise trade, 2015 and 2018
2015 2018
(a)    Exports (f.o.b.)
Asia  
27.9%
Middle East
7.0%Americas
29.4%
Switzerland
8.1%
Norway  2.8%Turkey 3.9%
Russian 
Federation 
4.4%
Total:  EUR 1,790.4 billion Total:  EUR 1,956.4 billion
(b)    Imports (c.i.f.)
Norway 4.3%Europe  
15.0%Other America
7.3%
Middle East 
4.1% Africa 
7.7%Americas
21.8%
Russian 
Federation 
7.9%Other 
3.5%
Switzerland
6.0%
Other Europe
1.2%Japan 3.5%Other Asia
13.8%
Turkey 3.6%Korea, Republic of 
2.4%
China
19.9%Europe 
15.0%Asia
39.7%Other America 
6.9%
Africa 
7.7%Middle East 
4.8%Americas 
20.5%
Russian 
Federation
8.5%Other 
3.9%
Norway
4.2%Switzerland
5.6%
Other Europe 
1.4%Turkey 3.8%Korea, 
Republic of 
2.5%United States 
13.6%
Total:   EUR 1,725.2 billion Total:   EUR 1,979.2 billionOther Asia
13.7%United States
20.7%
Other Europe 1.9%United States 
20.8%
Source:  Japan 3.5%Asia
40.0%Switzerland
8.5%
Other  Europe 
2.4%Other 
America
8.6%
Africa 8.7%Other Asia
13.3%
China 
10.7%Other America
8.7%
China
20.3%Other    
4.4%
Africa 
7.8%
United States 
14.5%Japan   3.2%
Europe
17.5%
Middle East
8.6%Other 
3.7%
China 
9.5%
Europe
17.2%Japan 
3.3%Asia   
29.8%
Norway  2.7%Americas
29.5%
Turkey  4.4%Other Asia
12.6%
WTO Secretariat calculations, based on Eurostat, International trade in goods. Viewed at: 
https://ec.europa.eu/eurostat/web/international -trade-in-goods/data/database.Korea, Republic of 
2.7%
Russian Federation 
4.1%Korea, Republic of 
2.5%WT/TPR/S/395 • European Union  
 
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  1.40.   Regarding extra -EU trade in services, the EU remained a net exporter, and the surplus in 
services trade increased during the review period. Exports grew consid erably, after a slight 
stagnation between 2015 and 2016. Imports also grew in 2017 -18, but at a slower pace. 
Telecommunication, transport, travel, finance, and other business services are the main services 
traded by EU countries. The United States and Swit zerland are the main partners in services trade. 
China and Norway also have significant shares (Table 1.2).  
Table 1.2 Extra -EU trade in services, by sector and partner, 2015 -18 
  Exports  Imports  
2015  2016  2017  2018a 2015  2016  2017  2018a 
Total (EUR billion)  871.8  870.5  912.4  918.5  733.2  732.3  720.7  728.4  
By sector  (% of total)  
Manufacturing services 
on physical inputs owned 
by others  2.3 2.4 2.1 2.2 1.3 1.5 1.7 1.8 
Maintenance and repair 
services n.i.e.  1.4 1.5 1.6 1.8 1.4 1.5 1.7 1.9 
Transport  17.8 17.6 18.1 17.9 17.1 16.5 17.5 18.2 
 Sea transport  9.5 8.4 8.9 .. 7.9 7.3 7.9 .. 
 Air transport  5.6 6.4 6.5 .. 6.0 6.0 6.3 .. 
 Other modes of 
 transport  2.4 2.4 2.4 .. 2.8 2.7 3.0 .. 
 Postal and courier 
 services  0.3 0.4 0.4 .. 0.4 0.4 0.5 .. 
Travel  14.7 14.3 15.0 15.4 14.5 13.9 14.8 15.2 
Construction  1.6 1.4 1.4 1.3 0.8 0.8 0.8 0.8 
Insurance and pension 
services  3.2 3.6 2.5 3.2 1.8 1.8 1.9 1.9 
Financial services  10.3 9.9 9.5 9.0 6.7 6.4 6.7 6.9 
Charges for the use of 
intellectual property 
n.i.e. 7.4 7.5 8.2 7.2 15.2 15.6 15.6 14.8 
Telecommunications, 
computer, and 
information services  12.8 12.8 13.6 14.5 10.2 6.3 6.9 7.0 
 Telecommunications 
services  2.0 1.9 1.8 .. 2.0 1.9 1.8 .. 
 Computer services  10.1 10.0 10.8 .. 7.8 3.9 4.5 .. 
 Information services  0.7 0.8 1.0 .. 0.4 0.5 0.5 .. 
Other business services  26.3 27.0 26.0 25.5 28.6 33.4 30.1 29.2 
 R&D services  4.1 4.6 4.8 4.3 7.7 11.9 7.4 7.4 
 Professional and 
 management 
 consulting services  7.2 7.4 7.5 8.3 7.0 7.7 8.4 7.9 
 Technical, trade -
 related, and other 
 business services  15.0 15.0 13.8 12.9 13.8 13.8 14.3 13.9 
Personal, cultural, and 
recreational services  1.0 1.1 1.1 1.3 1.6 1.5 1.5 1.5 
Government goods and 
services n.i.e.  0.9 0.9 0.8 0.9 0.8 0.9 0.9 0.9 
Services not allocated  0.3 0.1 0.0 0.0 0.0 0.0 0.0 0.0 
By selected trading 
partners/regions          
European Free Trade 
Association  17.0 16.9 16.5 .. 12.4 15.2 12.5 .. 
 Iceland  0.1 0.2 0.2 .. 0.2 0.2 0.3 .. 
 Liechtenstein  0.1 0.1 0.1 .. 0.1 0.1 0.1 .. 
 Norway  3.5 3.3 3.1 .. 2.2 2.2 2.2 .. 
 Switzerland  13.2 13.4 13.0 12.9 10.0 12.7 9.9 8.4 
Turkey  1.5 1.5 1.4 .. 2.3 1.9 2.0 .. 
Russian Federation  3.0 2.9 3.2 3.0 1.7 1.5 1.7 1.8 
Africa  6.2 5.6 5.2 .. 5.7 5.1 5.0 .. WT/TPR/S/395 • European Union  
 
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    Exports  Imports  
2015  2016  2017  2018a 2015  2016  2017  2018a 
Northern Africa  1.7 1.6 1.5 .. 2.1 1.9 2.2 .. 
 Egypt  0.6 0.5 0.5 .. 0.7 0.6 0.7 .. 
 Morocco  0.5 0.5 0.5 .. 0.7 0.8 0.8 .. 
Central and South Africa  4.5 3.9 3.7 .. 3.5 3.1 2.8 .. 
 South Africa  1.0 0.9 1.0 .. 0.7 0.7 0.7 .. 
 Nigeria  0.6 0.4 0.4 .. 0.2 0.2 0.2 .. 
Americas  36.9 35.8 35.8 .. 47.1 44.4 45.8 .. 
 Northern America  28.4 28.3 28.3 .. 31.1 33.0 32.9 .. 
 Canada  2.2 2.3 2.4 2.5 1.7 1.6 1.8 2.1 
 United States  26.1 26.0 25.9 26.7 29.3 31.3 31.0 30.5 
 Central America  4.6 3.7 3.6 .. 13.7 9.2 10.5 .. 
 Mexico  1.1 1.2 1.2 .. 0.7 0.7 0.8 .. 
 South America  3.9 3.7 4.0 .. 2.4 2.2 2.4 .. 
 Argentina  0.5 0.5 0.6 .. 0.3 0.3 0.3 .. 
 Brazil  1.9 1.7 1.8 1.7 1.2 1.1 1.1 1.1 
 Chile 0.4 0.4 0.5 .. 0.3 0.3 0.3 .. 
China  4.9 4.9 5.1 5.5 3.9 4.4 4.2 4.1 
Hong Kong, China  1.3 1.3 1.5 1.5 1.6 1.6 1.8 1.8 
India 1.7 1.6 1.8 1.8 2.1 2.1 2.4 2.7 
Indonesia  0.5 0.5 0.5 .. 0.3 0.3 0.4 .. 
Japan  3.3 3.6 3.8 3.7 2.2 2.5 2.5 2.7 
Malaysia  0.5 0.5 0.5 .. 0.4 0.5 0.6 .. 
Philippines  0.2 0.2 0.2 .. 0.4 0.4 0.4 .. 
Singapore  2.8 2.8 3.2 .. 3.0 3.1 3.1 .. 
Korea, Rep. of  1.5 1.4 1.5 .. 0.9 1.0 1.1 .. 
Separate Customs 
Territory of Taiwan, 
Penghu, Kinmen and 
Matsu (Chinese Taipei)  0.6 0.6 0.7 .. 0.5 0.4 0.5 .. 
Thailand  0.4 0.4 0.4 .. 0.8 0.9 0.9 .. 
Australia  2.4 2.4 2.6 .. 1.4 1.2 1.3 .. 
New Zealand  0.3 0.3 0.3 .. 0.2 0.2 0.3 .. 
Saudi Arabia  1.5 1.6 1.6 .. 0.4 0.4 0.5 .. 
United Arab Emirates  1.8 1.9 1.8 .. 1.6 1.8 1.8 .. 
.. Not available.  
a Provisional.  
Source:  Eurostat, Balance of Payments (bop_its6_det) . Viewed at: 
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database .  
1.3.2   Trends and patterns in f oreign direct investment (FDI)  
1.41.   The EU remains the world's largest recipient and supplier of FDI. In addition, it continued to 
be a net investor in the rest of the world during the review period. As at end -2017, it held 
EUR 7,487  billion in FDI stocks outsi de the EU against EUR  6,441 billion inside the EU.  
1.42.   Figures on extra -EU inbound and outbound FDI flows displayed an important decrease in 
2015-17, in line with the global trend and amid raising global uncertainty over trade and investment. 
According to the OECD, the trend was set to continue in 2018, and the recent tax policy in the 
United  States was expected to play a role as US multinationals repatriated large amounts of earnings 
held by foreign affiliates.33 
1.43.   FDI inflows surged, at EUR 697. 5 billion, in 2015, before dropping to EUR  163.3  billion in 
2017, reflecting large -scale investments and divestments to and from Special Purpose Entities 
                                                
33 OECD, FDI in figures . Viewed at: http://www.oecd.org/investment/FDI -in-Figures -April-2019.pdf . WT/TPR/S/395 • European Union  
 
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  (SPEs), mainly in Luxembourg, and the Netherlands (Table 1.3). Flows into the United Kingdom and 
Germa ny remained solid, while France, recorded volatile FDI performance.  
1.44.   FDI outflows from the EU also decreased, from EUR  737.1 billion in 2015 to EUR  245.1  billion 
in 2017 (Table 1.3 ). The largest decline took place in Luxembourg, while figures from four majo r 
EU economies (Germany, France, the United Kingdom and Italy) showed mixed performance 
(Table  1.3). In 2017, outflows from the United Kingdom firmed up noticeably, owing to large -scale 
purchases by United Kingdom -based multinational companies. For example , British American 
Tobacco purchased the remaining shares in Reynolds (United States) for USD  49 billion, and Reckitt 
Benckiser acquired Mead Johnson Nutrition (United States) for USD  17 billion.  
Table 1.3 Extra-EU FDI flows, 2015 -17 
(EUR million)  
 Inward  Outward  
  2015  2016  2017  2015  2016  2017  
EU-28 697,508  390,777  163,319  737,147  359,479  245,136  
Austria  -38,424  3,457  8,832  -955 -35,347  3,207  
Belgium  33,749  39,692  5,234  6,315  -74,910  3,544  
Bulgaria  928 38 178 39 62 163 
Croatia  -411 36 27 -104 20 332 
Cyprus  979 739 .. 14,200  1,612  -724 
Czech Republic  -444 416 466 52 -312 -158 
Denmark  727 6,100  -1,477  2,372  14,874  823 
Estonia  -201 5 310 -121 84 38 
Finland  1,556  -2,351  -1,183  916 1,623  -2,062  
France  19,504  2,311  13,485  14,782  25,248  18,170  
Germany  2,218  5,579  12,137  34,080  20,642  32,744  
Greece  638 855 1,148  774 -1,769  343 
Hungary  -13,938  -5,458  6,717  -22,923  58,517  3,533  
Ireland  147,419  61,523  -56,236  85,186  20,680  11,491  
Italy 3,816  2,426  3,492  14,308  11,924  19,741  
Latvia  409 360 -125 12 73 44 
Lithuania  350 229 -288 -3 43 61 
Luxembourg  277,946  111,309  -33,764  233,567  100,672  -245,936  
Malta  3,386  1,742  1,243  -4,878  -1,688  -2,106  
Netherlands  193,558  80,934  78,587  354,331  165,911  270,712  
Poland  -135 1,238  1,357  521 3,561  1,072  
Portugal  1,369  1,881  2,968  155 514 305 
Romania  519 135 .. -94 -7 309 
Slovak Republic  -33 -835 -457 -41 21 54 
Slovenia  183 107 234 277 167 3 
Spain  7,543  4,685  1,644  32,814  33,197  14,046  
Sweden  406 7,080  3,242  12,218  6,467  7,661  
United Kingdom  53,891  65,391  77,673  -40,652  7,236  107,724  
.. Not available.  
Source:  Eurostat, Balance of Payments (bop_gdp6_q) . Viewed at: 
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database . 
1.45.   The stock of inward FDI increased between 2015 and 2017, while the outward stock was 
volatile (Table  1.4). The United States and Switzerland remain the largest sources of inward FDI into 
the EU, both in terms of stocks and flows. Among the EU -28, the Netherlands and Luxembourg (the 
main locations of SPEs) remained, by far, the EU members with the largest inwa rd and outward FDI 
stocks, followed by the United Kingdom. The majority of inward stocks are in mining, manufacture 
and the services sector, with financial and insurance activities being the most prevalent.  
1.46.   In 2019, according to a report released by the Co mmission on FDI, the EU hosts investors 
from about 170 countries, with the United States, EFTA countries, and Canada (the historical main 
investors) (Table 1.5) accounting by far for the largest share in terms of the number of companies 
controlled and, eve n more so, in terms of assets controlled. The document also shows the emergence 
of new investors, such as China and other emerging countries, with increasing number of deals over WT/TPR/S/395 • European Union  
 
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  the last years, such as, by China in aircraft manufacturing and specialized m achinery, and by India 
in pharmaceuticals.34 
Table 1.4 Extra -EU FDI stocks, 2015 -17 
(EUR billion)  
 Inward  Outward  
  2015  2016  2017  2015  2016  2017  
EU-28 6,016  6,319  6,441  7,415  7,784  7,487  
Austria  80 78 85 136 96 93 
Belgium  34 44 55 76 0 12 
Bulgaria  9 9 9 1 1 1 
Croatia  3 3 4 2 3 3 
Cyprus  66 67 105 164 169 158 
Czech Republic  12 12 15 1 1 1 
Denmark  30 37 35 67 83 77 
Estonia  3 3 3 1 1 1 
Finland  8 7 5 17 17 14 
France  173 180 197 498 531 494 
Germany  174 189 230 525 541 524 
Greece  4 5 6 10 7 7 
Hungary  56 53 54 84 147 133 
Ireland  474 475 418 209 215 221 
Italy 34 35 40 149 170 186 
Latvia  3 4 4 0 0 0 
Lithuania  2 3 2 0 0 0 
Luxembourg  1,829  1,949  1,837  1,807  1,894  1,512  
Malta  147 54 57 60 20 20 
Netherlands  1,863  2,125  2,198  2,335  2,629  2,753  
Poland  13 14 15 6 9 8 
Portugal  13 12 15 14 13 13 
Romania  7 7 8 0 0 0 
Slovak Republic  4 3 3 0 0 0 
Slovenia  2 2 2 3 3 3 
Spain  101 108 110 261 291 285 
Sweden  67 72 68 131 140 134 
United Kingdom  806 768 860 855 802 831 
Source:  Eurostat, Balance of Payments (bop_fdi6_geo). Viewed at: 
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database .  
Table 1.5 FDI stocks by major partner, 2015 -17 
(EUR billion)  
  Inward  Outward  
2015  2016  2017  2015  2016  2017  
Extra -EU-28 6,016  6,319  6,441  7,415  7,784  7,487  
United States  2,459  2,461  2,263  2,699  2,799  2,561  
EFTA 818 907 941 995 1,098  1,120  
 Switzerland  688 765 803 894 985 1,005  
 Iceland  -1 -1 -1 7 8 19 
 Liechtenstein  41 37 45 2 2 2 
 Norway  90 105 94 92 103 93 
Canada  246 300 288 283 315 310 
Japan  207 227 261 86 100 99 
Hong Kong, China  95 108 156 145 142 155 
                                                
34 European Commission, Foreign direct investment report: continuous rise of forei gn ownership of 
European companies in key sectors . Viewed at http://trade.ec.europa.eu/doclib/press/index.cfm?id=1993 . WT/TPR/S/395 • European Union  
 
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    Inward  Outward  
2015  2016  2017  2015  2016  2017  
Singapore  77 138 118 193 196 226 
Russian Federation  72 73 83 168 233 217 
Bahamas  64 68 74 50 59 55 
Barbados  9 13 71 4 11 44 
China  43 47 60 175 183 178 
Israel  33 45 58 18 28 30 
Mexico  32 36 50 162 144 153 
Brazil  46 36 44 331 374 322 
United Arab Emirates  41 45 40 30 36 39 
Australia  37 29 30 141 177 168 
Korea, Rep. of  19 24 28 43 47 52 
Turkey  12 22 19 78 76 67 
Panama  5 26 12 38 24 22 
Kazakhstan  6 9 11 51 66 61 
India 13 6 11 72 75 78 
South Africa  12 12 11 96 70 60 
Argentina  2 2 2 57 45 46 
Nigeria  4 2 2 51 43 37 
Chile 2 2 2 48 56 53 
Egypt  0 1 1 39 38 39 
Angola  2 1 1 32 31 28 
Indonesia  7 1 1 31 35 33 
Source:  Eurostat, Balance of Payments (bop_fdi6_geo). Viewed at: 
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database .  WT/TPR/S/395 • European Union  
 
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  2  TRADE AND INVESTMENT  REGIMES  
2.1  General Framework  
2.1.  The TFEU defines the division of competences between the EU and its member States by 
distinguishing, in particular, between areas of exclusive EU competence1, areas of shared 
competence2, and areas in which the EU's competence is of a supporting nature.3 The common 
commercial policy is one of five policy areas in which the EU's competence is explicitly defin ed as 
being exclusive.4 
2.2.  The TFEU provides that "[t]he common commercial policy shall be based on uniform principles, 
particularly regarding changes in tariff rates, the conclusion of tariff and trade agreements relating 
to trade in goods and services, and the commercial aspects of intellectual property, foreign direct 
investment, the achievement of uniformity in measures of liberalisation, export policy and measures 
to protect trade such as those to be taken in the event of dumping or subsidies" and "shall be 
conducted in the context of the principles and objectives of the EU's external action".5 The 
negotiation and conclusion of international agreements in the field of transport are excluded from 
the scope of the common commercial policy.6 
2.3.  Legislation to de fine the framework for implementing the common commercial policy consists 
of regulations adopted in accordance with what is known as the ordinary legislative procedure.7 This 
procedure consists of the joint adoption by the European Parliament and the Counc il of the EU of a 
proposal for a legislative act submitted by the European Commission.8 The Parliament and the 
Council may propose amendments to the Commission's proposal. The detailed rules governing the 
process whereby the Parliament and the Council arri ve at a joint position on a Commission proposal 
are set out in Article 294 of the TFEU.  
2.4.  The Commission also implements trade policy, notably through "delegated acts" and 
"implementing acts".9 Under delegated acts, the legislators (i.e. the Parliament and t he Council) 
delegate power to the Commission to adopt non -legislative acts of general application, in order to 
supplement or amend certain non -essential elements of the legislative act. Under implementing acts, 
the Commission, where specified in the primar y legislation, acquires the necessary implementing 
powers in instances where uniform conditions for implementing legally -binding EU acts are needed. 
The Commission's exercise of implementing powers is controlled by the member States, through a 
procedure kn own colloquially as "comitology". Under this procedure, committees, composed of 
representatives from member States, assist the Commission in executing the implementing powers 
conferred upon it by the legislators. The comitology rules are set out in specifi c legislation.10 The 
                                                
1 In areas of exclusive EU competence, only the EU may legislate and adopt binding legal acts. The 
member States may only do so if so empowered by the EU or for the implementation of EU acts. Art. 2(1), 
TFEU.  
2 In areas of shared competence, both the EU and  the member States may legislate and adopt 
legally -binding acts. The member States may exercise their competence to the extent that the EU has not done 
so and to the extent that the EU has decided to cease doing so. Art. 2(2), TFEU.  
3 In areas in which the  EU's competence is of a supporting nature, it may take actions to support, 
coordinate or supplement the actions of the member States, without superseding their competence. Any 
legally -binding acts of the EU in these areas shall not entail harmonization of  member States' laws or 
regulations. Art. 2(5), TFEU.   
4 Art. 3.1(e), TFEU. The other policy areas which are explicitly identified by the Treaty as being of 
exclusive EU competence are: the customs union; the establishing of the competition rules necessary  for the 
functioning of the internal market; monetary policy for the member States whose currency is the euro; and the 
conservation of marine biological resources under the common fisheries policy. Arts. 3.1(a) -(d), TFEU.  
5 Art. 207(1), TFEU. Because these  principles and objectives include sustainable development linked to 
the preservation and improvement of the quality of the environment and the sustainable management of global 
natural resources, "the objective of sustainable development henceforth forms a n integral part of the common 
commercial policy". Opinion 2/15 of the Court (Full Court), 16 May 2017, Request for an opinion pursuant to 
Article 218(11) TFEU, made on 10 July 2015 by the European Commission, para. 147. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:62015CV0002(01)&from=EN . 
6 Art. 207(5), TFEU.  
7 Art. 207(2), TFEU.  
8 Art. 289, TFEU.  
9 Arts. 290 and 291(2), TFEU. WT O documents WT/TPR/S/284/Rev.2, 28 November 2013, 
paras.  2.5-2.6 and WT/TPR/S/317/Rev.1, 21 October 2015, paras. 2.6 -2.7. 
10 The current comitology rules came into effect on 1 March 2011. Regulation (EU) No. 182/2011 of the 
European Parliament and of the Co uncil of 16 February 2011 laying down the rules and general principles WT/TPR/S/395 • European Union  
 
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  adaptation of trade instruments to the current comitology rules was completed via the Trade 
Omnibus I and II Regulations, and entered into force on 20 February 2014.11 
2.5.  The TFEU rules regarding the negotiation and conclusion of internatio nal trade agreements12 
provide that the Commission makes a recommendation to launch negotiation of an agreement to 
the Council, which shall authorize the opening of negotiations. The Commission conducts 
negotiations on the trade agreement, in consultation w ith a committee appointed by the Council (the 
Trade Policy Committee), and reports regularly to the Parliament.13 Section 2.2   of this Report 
describes several recent initiatives aimed at enhancing the transparency and inclusiveness of 
EU trade policy, notably in respect of the launch and conduct of negotiations on tr ade agreements.  
2.6.  The Council adopts the decision concluding the agreement, after obtaining the consent of the 
Parliament. The latter ratifies international trade agreements by simple majority vote. Council 
decisions on the negotiation and conclusion of int ernational trade agreements are adopted by a 
qualified majority, subject to certain exceptions. Firstly, the Council must act unanimously for the 
negotiation and conclusion of an agreement in respect of agreements in the field of services, 
commercial aspec ts of intellectual property (IP), and foreign direct investment (FDI), if such 
agreements include provisions for which unanimity is required for the adoption of internal rules. 
Secondly, the Council must act unanimously for the negotiation and conclusion o f agreements in the 
field of trade in cultural and audiovisual services where such agreements risk prejudicing the EU's 
cultural and linguistic diversity, and in the field of trade in social, education and health services 
where these agreements risk seriou sly disturbing the national organization of such services and 
prejudicing the responsibility of member States to deliver them.14 
2.7.  In addition to the five specific policy areas explicitly defined by Article 3.1 of the TFEU as being 
of exclusive EU competence,  the TFEU also expressly provides the EU with exclusive competence to 
conclude international (trade) agreements in certain circumstances defined in Article 3.2. Pursuant 
to this provision, the EU has exclusive competence for the conclusion of an internatio nal (trade) 
agreement: (i) when this is provided for in a legislative act of the EU; (ii) when it is necessary to 
enable the EU to exercise its internal competence; or (iii) insofar as the conclusion of the 
international agreement may affect common rules o r alter their scope.  
2.8.  In an opinion of 16 May 2017, the Court of Justice of the EU (CJEU) clarified the scope of the 
EU's exclusive competence to conclude international trade agreements.15 This opinion concerned a 
question submitted by the Commission on whe ther the envisaged free trade agreement (FTA) with 
Singapore, the first FTA completed after the entry into force of the TFEU, could be signed by the EU 
alone or whether it would have to be signed and concluded both by the EU and by each of its member 
State s as a "mixed" agreement. The Court confirmed that most of the provisions of the envisaged 
                                                
concerning mechanisms for control by Member States of the Commission's exercise of implementing powers. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32011R0182&from=EN . See also 
WTO document WT/TPR/S/248/Rev.1, 1 August 2011, Chart II.1.  
11 Regulation (EU) No. 37/2014 of the European Parliament and of the Council of  15 January 2014 
amending certain regulations relating to the common commercial policy as regards the procedures for the 
adoption of certain measures. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32014R0037&from=EN ; Regulation (EU) No. 38/2014 of the European 
Parliament and of the Council of 15 January 2014 amending certain regulations relating to the common 
commercial policy as regar ds the granting of delegated and implementing powers for the adoption of certain 
measures. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=C ELEX:32014R0038&from=EN . 
12 Arts. 207(3) -(4) and 218, TFEU.  
13 See also WTO document WT/TPR/S/357/Rev.1, 13 October 2017, paras. 2.4 -2.8. For a detailed 
description of the launch, conduct and conclusion of negotiations on EU trade agreements, see European 
Commission, Negotiating EU trade agreements – Who does what and how we reach a final deal . Viewed at: 
http://trade.ec.europa.eu/doclib/doc s/2012/june/tradoc_149616.pdf .  
14 Art. 207(4), TFEU.  
15 Opinion 2/15 of the Court (Full Court), 16 May 2017, Request for an opinion pursuant to Article 
218(11) TFEU, made on 10 July 2015 by the European Commission (Opinion 2/15 of the Court). See Kleimann, 
D. and Kübek, G., The Signing, Provisional Application, and Conclusion of Trade and Investment Agreements in 
the EU: the Case of CETA and Opinion 2/15, Legal issues of Economic Integration , Vol. 45, No. 1 (2018), 
pp. 13-46; Hainbach, P., The CJEU's Opinion  2/15 and the Future of EU Investment Policy and Law -Making, 
Legal Issues of Economic Integration , Vol. 45, No. 2, (2018), pp. 199 -210; Geraets, D., Changes in EU Trade 
Policy After Opinion 2/15, Global Trade and Customs Journal , Vol. 13, No. 1 (2018), pp. 13-18; and Gruni, G., 
Towards a Sustainable World Trade Law? The Commercial Policy of the European Union After Opinion 2/15 
CJEU, Global Trade and Customs Journal , Vol. 13, No. 1 (2018), pp. 4 -12.  WT/TPR/S/395 • European Union  
 
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  FTA were covered by the EU's exclusive competence to conclude international agreements, because 
they fell within the scope of the common commercial policy, and there by fell within the scope of the 
exclusive competence in Art. 3(1)(e) of the TFEU, or  they were within the EU's exclusive competence 
pursuant to Article 3(2) of the TFEU.16 
2.9.  In light of Opinion 2/15 of the Court, the Commission considers that the EU's exclusi ve 
competence to conclude international trade agreements covers the following matters:  
• trade in goods, including regulatory matters;  
• trade in services, including mutual recognition agreements and all transport services other 
than air transport;  
• trade rel ated aspects of IP in its entirety;  
• all public procurement matters;  
• market access in the area of FDI;  
• investment protection as far as it concerns FDI;  
• trade and sustainable development in its entirety; and  
• the termination of member State bilateral inv estment agreements for the parts concerning 
exclusive competence.17  
2.10.   Opinion 2/15 of the Court resulted in an important change in the architecture of the EU's trade 
agreements (Section 2.2).  
2.11.   In March 2017, the United Kingdom notified its intention to withdr aw from the EU under 
Article  50 of the Treaty on European Union on 31 March 2019. While negotiations under Article  50 
have resulted in an agreement on the terms of the United Kingdom's withdrawal from the EU, this 
agreement had not yet been ratified at the  time of the circulation of this report. On 29 October 2019, 
the European Council, in agreement with the United Kingdom, decided on an additional extension of 
the period provided for in Article 50(3) until 31 January 2020.   
2.2  Trade Policy Formulation and Obj ectives  
2.12.   EU trade policy during the period under review continued to be guided by the general 
objectives of the Trade for All Strategy,  adopted  in October 2015.18 In this regard, the 
                                                
16 The Court concluded that the FTA between the EU and Sing apore fell within the exclusive competence 
of the EU, with the exception of provisions which fell within a competence shared between the EU and the member 
States: (i) investment protection provisions, insofar as they related to non -direct investment; (ii) the 
investor -state dispute settlement mechanism; and (iii) provisions on the object of the agreement, institutional 
matters, transparency, and state -to-state dispute settlement, insofar as those provisions related to provisions 
on investment protection tha t fell within a competence shared between the EU and the member States. 
Opinion  2/15 of the Court, para. 3 05. 
17 European Commission, The Opinion of the European Court of Justice on the EU -Singapore Trade 
Agreement and the Division of Competences in Trade P olicy. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2017/september/tradoc_156035.pdf . 
18 European Commission, Trade for All - Towards a more responsible trade and investment policy. 
Viewed at:  http://trade.ec.europa.eu/doclib/docs/2015/october/tradoc_153846.pdf . The Trade for All Strategy 
was described in some detail in the previous Review. WTO document WT/TPR/S/357/Rev.1, 13 October 2017, 
pp, 32-33, Box 2.1. The Strategy pursues four main objectives: (i) to make EU trade policy more effective, 
including by updating trade policy to  take account of new economic realities; (ii) to make EU trade and 
investment policy more transparent; (iii) to anchor EU trade policy in values, notably with regard to the 
protection of the right to regulate, sustainable development, fair and ethical trad e, human rights, the fight 
against corruption, and responsibility in the management of supply chains; and (iv) to achieve progress in 
negotiations to shape globalization by re -energizing multilateral negotiations, designing a new and open 
approach to bilat eral and regional agreements, and starting new negotiations on trade and investment with 
countries in the Asia -Pacific region. See also European Commission, Reflection paper on harnessing WT/TPR/S/395 • European Union  
 
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  European  Commission issued a communication in September 2017 on proposals f or "a balanced and 
progressive trade policy to harness globalisation".19 The communication noted that "[g]lobal trade 
is a key contributor to a competitive and prosperous EU", but "needs to be proactively shaped and 
managed to ensure it is fair, projects va lues and remains firmly anchored in a rules -based system". 
The EU's aim is a "trade policy that is transparent and responsible, benefits all citizens, and provides 
modern solutions for the realities of today's economy in the middle of technological change" . The 
communication defined three main objectives of EU trade policy.20  
2.13.   The first objective is to seal new trade partnerships to build progressive rules for global trade. 
EU trade policy aims to create new economic opportunities through a comprehensive negotiating 
agenda at various (bilateral and multilateral) levels. The EU is committed to strengthening its 
economic ties with future engines of growth in Asia and Latin America. This first objective also 
involves the use of trade policy to p romote the universal values the EU adheres to, regarding 
environmental, consumer, social and labour protection and fundamental rights, as well as the 
express preservation of the right to regulate in the public interest. Section 2. 3.2 of this Report 
discuss es EU trade agreements concluded and/or entered into force, and the launch of new 
negotiations during the review period.  
2.14.   A noteworthy development relating to this first objective concerns gender aspects of 
international trade, which have begun to feature more prominently in EU trade policy. This includes 
analysis to improve the understanding of the impact of international trade agreements on gender 
equality. The potential effects of trade agreements on women were analysed in sustainability impact 
assessmen ts and in several ex post  assessments of EU trade agreements. In 2017, the Commission 
published a study on the gender balance of the employment opportunities supported by extra -EU 
exports.21 More recently, it launched a study, which is implemented by the In ternational Trade 
Centre (ITC), on "Women in Extra -EU Trade: Opportunities and Obstacles". The results of this study 
were presented at the "Trade for Her" conference, organized by the Commission on 
30 September  2019 in Brussels. Furthermore, the Commission  is implementing a recommendation 
on Trade and Gender of the Joint Committee, established under the EU's FTA with Canada, the 
Comprehensive Economic and Trade Agreement (CETA). This provides for cooperation between the 
Parties to improve the capacity and c onditions for women to access, and fully benefit from, the 
opportunities created by the CETA, starting with analytical work to better understand the impact of 
trade on gender equality and women's participation in the economy.22 For example, together with 
the Canadian Mission to the EU, the Commission organized a CETA trade and gender workshop in 
Brussels on 1 April 2019. Also, in negotiations on the modernization of the EU -Chile Association 
Agreement, the Commission tabled a proposal for dedicated provisions  on trade and gender 
equality.23  
2.15.   The review period also saw increased interest in ways to improve the practical implementation 
and effectiveness of sustainable development provisions in EU FTAs.24 A debate, launched by the 
                                                
globalisation . Viewed at: https://ec.europa.eu/commission/publications/reflection -paper -harnessing -
globalisation_en . 
19 European Commission, A Balanced and Progressive Trade Policy to Harness Globalisation . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2017/september/tradoc_156038.pdf . 
20 The Commission's trade agenda also aims to support the general objectives of boosting jobs, grow th 
and investment, and reinforcing the position of the EU as a global actor. European Commission, DG Trade, 
Strategic Plan 2016 -2020 - Trade . Viewed at: https://ec.eur opa.eu/info/publications/strategic -plan-2016-
2020-trade_en ; and Management Plan 2019 - Trade . Viewed at: 
https://ec.europa.eu/info/publications/management -plan-2019-trade_ en. 
21 Rueda -Cantuche, J.M. and Sousa, N., Are EU Exports Gender Blind? Some Key Features of Women 
Participation in Exporting Activities in the EU, Chief Economist Note , Issue 3, June 2017. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2017/june/tradoc_155632.pdf . 
22 Recommendation 002/2018 of 26 September 2018 of the CETA Joint Committee on Trade and 
Gender. Viewed at: http://trade.ec.europa.eu/doclib/docs/2018/september/tradoc_157419.pdf . 
23 European Commission, Draft provisions on Trade and Gender Equality in the context of the 
Modernisation of the EU -Chile Association Agreement . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/june/tradoc_156962.pdf . 
24 Hradilova, K. and Svoboda, O., Sustainable Development Chapters in the EU Free Trade Agreements: 
Searching f or Effectiveness, Journal of World Trade  52, No. 6 (2018), pp. 1019 -1042; Douma, W.Th., The 
Promotion of Sustainable Development through EU Trade Instruments, European Business Law Review , 2017, 
pp. 197 -216. WT/TPR/S/395 • European Union  
 
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  Commission in July 201725, revealed  a clear consensus on the need to improve the implementation 
of such provisions. While there were suggestions for the introduction of economic sanctions to 
enforce compliance with sustainable development provisions, this was opposed by most participants 
in the debate. The Commission pointed out that a cooperative approach is more appropriate and 
effective. A non -paper, issued in February 2018 concluding this debate, set out an Action Plan of 
15 concrete steps aimed at: (i) improving coordination between EU institutions and between the EU 
and relevant international organizations; (ii) enabling civil society to play a more effective role in 
the implementation of sustainable development provisions, including by facilitating the monitoring 
role of civil society,  allowing civil society to comment and provide advice not only on provisions of 
sustainable development chapters but, more generally, on other FTA provisions with implications for 
sustainable development, and reinforcing the implementation of provisions on  corporate social 
responsibility; (iii) taking actions aimed at identifying priority implementation actions for each 
partner country, a more assertive approach to enforcement, the encouragement of the early 
ratification of core international agreements, re viewing the effectiveness of implementation on an 
ongoing basis, developing a handbook for implementation, and stepping up resources; and 
(iv) improving transparency and communication.26  
2.16.   The second objective of the  EU trade policy  agenda is a robust trade and investment policy 
protecting EU  interests and ensuring fairness. The September 2017 communication emphasized the 
need to actively use all the tools available to the EU to enforce commitments undertaken by its 
partners to remove trade barriers and to co mbat unfair trade practices. In this respect, it referred 
to the reform of EU Trade Defence Instruments, and identified the need to combat unfair subsidy 
practices, which it considered to be one of the main root causes of unfair international trade. It als o 
highlighted discrimination and lack of reciprocity in government procurement and the acquisition of 
strategic EU assets by foreign investors as areas where the EU need ed to take steps to protect its 
interests and ensure fairness.  
2.17.   The third objective of t he agenda is delivering effective agreements through a transparent 
and inclusive negotiation process. The Commission pointed out, in its September 2017 
communication, that, to be a credible negotiating partner, the EU must be able to ratify and 
implement i ts negotiated agreements in an accountable, legitimate and effective manner, and that, 
where agreements cover subjects fully covered by the common commercial policy, the EU will be 
able to proceed quickly. It noted that transparency and inclusiveness shoul d be ensured, irrespective 
of whether the final decision to adopt a trade agreement is taken only by the EU or also by the 
member States and, in this regard, it encouraged member States to ensure the involvement of 
national parliaments at the earliest stag e of EU trade negotiations. To this end, it decided to publish 
its recommendations for negotiating directives for trade agreements. It also announced the creation 
of an advisory group on EU trade negotiations.  
2.18.   Regarding Opinion 2/15 of the Court (Section 2.1  ), the Commission adopted a new approach 
to the architecture of EU trade agreements. The agreement completed in 2012 between the EU and 
Singapore was restructured to create two separate agreements: an FTA, covering matters within the 
exclusive competence of the EU and which will be concluded only by the EU; and an Investment 
Protection Agreement including both matters in  which the EU has exclusive competence and matters 
in which the EU and the member States share competences and which will be concluded by the EU 
and the member States.27 The trade agreement with Viet Nam was restructured in the same way.28 
In both cases, the  FTAs include provisions on the liberalization of FDI, whereas the Investment 
Protection Agreements contain provisions on the protection of foreign (direct and non -direct) 
investment after their establishment and procedures allowing investors to have recou rse to 
international dispute settlement.  
2.19.   The Council of the EU endorsed this new approach in May 2018 when it noted that "in the 
future the Commission intends to recommend draft negotiating directives for FTAs covering exclusive 
                                                
25 European Commission, Trade and Sustainable Dev elopment (TSD) Chapters in EU Free Trade 
Agreements (FTAs). Viewed at: http://trade.ec.europa.eu/doclib/docs/2017/july/tradoc_155686.pdf . 
26 European Commission, Feedback and way forward on improving the implementation and enforcement 
of Trade and Sustainable Development chapters in EU Free Trade Agreements . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/february/tradoc_156618.pdf . 
27 EU-Singapore trade and investment agreements. Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=96 1. 
28 EU-Viet Nam trade and investment agreements. Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1437 . WT/TPR/S/395 • European Union  
 
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  EU competence on the one h and and separate mixed investment agreements on the other, with a 
view to strengthening the EU's position as a negotiating partner. It is for the Council to decide 
whether to open negotiations on this basis".29 The decoupling of investment protection provis ions 
from trade agreements is a significant change, compared with the trend noted in the previous 
Review, towards the integration of trade and investment in comprehensive economic agreements.30  
2.20.   In late 2017, the Commission began to publish the texts of dra ft negotiating directives, based 
on which it seeks authorization from the Council to open negotiations on international trade 
agreements. It encouraged the Council to publish the final adopted texts of such directives. The 
Council decides whether to publis h such final adopted directives on a case -by-case basis. Negotiating 
directives published to date include directives adopted for the opening of negotiations with Chile, 
Australia, New Zealand and the United States, WTO e -commerce negotiations, negotiations  on the 
establishment of a multilateral investment court, and negotiations on the modernization of the 
Energy Charter Treaty.31 The Commission also publishes the texts of initial EU  negotiating proposals, 
reports on negotiating rounds, and the consolidated negotiated text agreed between the parties 
before the completion of the final legal revision of the texts. The Commission also improved 
transparency with respect to the implementation phase of trade agreements, for example, through 
the publication of meeti ng agendas and reports.32  
2.21.   The Commission carries out impact assessment analyses to support its decision -making for 
all proposals with significant direct impact, including in the trade policy area. In terms of trade 
agreements, up to four major types of eva luation may be conducted during the life of a trade 
agreement. When the Commission recommends the opening of negotiations on a trade agreement, 
it also submits the results of an impact assessment, as required by the Commission's Better 
Regulation agenda.33 This assessment must verify the existence of a problem, identify its underlying 
causes, assess whether EU action is needed, and analyse the advantages and disadvantages of 
available solutions and their impacts. The assessment includes an online public cons ultation of 
interested parties. At the stage of negotiations, the Commission carries out trade sustainability 
impact assessments (SIAs) to analyse the economic, environmental, human rights and social 
impacts of the proposed trade agreements for both the EU  and its trading partners.34 SIAs are 
independent studies conducted by external consultants, involving comprehensive consultations with 
stakeholders and taking into account their knowledge and concerns both in the EU and in the trading 
partner. SIAs are pub lished online. Once the negotiations are concluded, and before the agreement 
is signed, an analysis of the economic impact of the proposed deal for the EU is prepared for the 
Parliament and the Council. After sufficient time has passed (normally five years  after entry into 
force), the Commission carries out an ex post  evaluation of the trade agreement, to assess whether 
the expected outcome was achieved, and also to look for unintended effects.35 Ex post  evaluations 
are also published online.  
                                                
29 Council of the EU, New approach on negotiating and concluding trade agreements adopted by Council . 
Viewed at: https://www.consilium.europa.eu/en/press/p ress-releases/2018/05/22/new -approach -on-
negotiating -and-concluding -eu-trade -agreements -adopted -by-council/ ; and Council of the EU, Draft Council 
conclusions on the negotiation and conclusion of EU trade agreements . Viewed at: 
http://data.consilium.europa.eu/doc/document/ST -8622-2018-INIT/en/pdf .  
30 WTO document WT/TPR/357/Rev.1, 13 October 2017, para. 2.16, noting that "the EU wants to 
integrate investment rules, includin g liberalization and protection provisions, into its broader trade 
agreements".  
31 The texts of these directives were viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1395 . 
32 European Commission, Transparency Policy in DG Trade . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/november/tradoc_157486.pdf . Published materials referred to in 
this paragraph were viewed at: http://trade.ec.euro pa.eu/doclib/press/index.cfm?id=1395 .  
33 European Commission, Impact assessments . Viewed at: http://ec.europa.eu/trade/policy/policy -
making/analysi s/policy -evaluation/impact -assessments . Better Regulation: why and how . Viewed at: 
https://ec.europa.eu/info/law/law -making -process /planning -and-proposing -law/better -regulation -why-and-
how_en . 
34 European Commission, SIAs. Viewed at: http://ec.europa.eu/trade/pol icy/policy -
making/analysis/policy -evaluation/sustainability -impact -assessments/ . 
35 European Commission, Ex post evaluations . Viewed at: http://ec.europa.eu/trade/policy/policy -
making/analysis/policy -evaluation/ex -post-evaluations/ . WT/TPR/S/395 • European Union  
 
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  2.22.   In addition to the SIA process, the Commission engages stakeholders during international 
trade negotiations through regular Civil Society Dialogue meetings.36  
2.23.   The Commission launched a series of annual comprehensive reports on the implementation 
of EU trade agreements.37  
2.24.   The task of the Expert Group on EU Trade Agreements, established in September 2017, is to 
provide expert advice that can assist the Commission in the negotiation and implementation of trade 
agreements. To this end, the Group: (i) provides tec hnical expertise and practical experience 
relevant to negotiations in bilateral, plurilateral and multilateral trade agreements; (ii) sheds light 
on the different perspectives that the stakeholders they represent may take on certain issues; 
(iii) provides input related to the overall implementation of trade agreements; and (iv) provides 
feedback on the perception and public debate on trade agreements across EU member States, and 
issues that may require particular attention on the basis of their contacts wit h their respective 
European networks. The Group is composed of between 20 and 30 members, selected from 
European -level, non -governmental organizations, which may include employers' organizations, 
trade unions, representative associations, socio -economic in terest groups like consumer 
associations, and other civil society organizations.38 It currently has 27 members .39  
2.3  Trade Agreements and Arrangements  
2.3.1   WTO  
2.25.   The EU is an original Member of the WTO, and each EU member State is also a WTO Member. 
The EU, through t he European Commission, represents all the member States in the WTO. It is a 
contracting party to the Agreement on Government Procurement, a participant in the Information 
Technology Agreement, and a signatory to the Agreement on Trade in Civil Aircraft. T he trade 
policies of the EU have been reviewed 13 times by the WTO; the last review was in 2017.40  
2.26.   The EU attaches great importance to preserving an open, rules -based multilateral trading 
system, with the WTO at its core but, at the same time, emphasizes t he need for a comprehensive 
reform of the WTO in respect of its negotiating, monitoring and dispute settlement functions.41 The 
EU presented its initial ideas on WTO reform in September 2018.42 It co-sponsored proposals to 
enhance transparency by improving c ompliance with notification requirements and to provide 
procedural guidelines for WTO Committees and Councils dealing with trade concerns.43 It also 
                                                
36 European Commission, EU trade meetings with Civil  Society . Viewed at: 
http://trade.ec.europa.eu/civilsoc/?_cldee=Y2F0aGVyaW5lLnZlcmJhZXlzZGlsdWFrYUBlZXNjLmV1cm9wYS5ldQ
%3d%3d&ur lid=54 . 
37 European Commission, Report on Implementation of EU FTAs, 1 January 2017 -31 December 2017 , 
Viewed at: http://trade.ec.europa.eu/doclib/docs/2018/october/tradoc_1 57468.pdf ; and accompanying 
Commission Staff Working Document, Individual reports and info sheets on implementation of EU Free Trade 
Agreements, 31 October 2018. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/october/tradoc_157473.PDF . 
38 Commission Decision of 13 September 2017 setting up the Group of Experts on EU Trade 
Agreements. Viewed at: 
http://ec.europa.eu/transparency/regexpert/index.cfm?do=groupDetail.groupDetailDoc&id=34613&no=1 . 
39 European Commission, Expert group on EU trade agreements . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2017/december/tradoc_156487.pdf . 
40 WTO documents WT/TPR/G/357, 17 May 2017, WT/TPR/S/357/Rev.1, 13 October 2017, and 
WT/TPR/M/357, 13 October 2017.  
41 For example, in March 2019, the European Council reaffirmed "its commitment to an open -rules-
based multilateral trading system with a modern ised WTO at its core, and to resisting all forms of 
protectionism and distortions". Viewed at: https://www.consilium.europa.eu/media/38789/22 -euco-final-
conclusion s-en.pdf . In June 2019, the Council of the EU adopted conclusions on EU action to strengthen 
rules-based multilateralism, including a commitment to "[c]ontinue the EU's leadership in the effort to preserve 
and reinforce the rules -based multilateral trading  system, with the WTO at its core, in all its functions, to 
ensure it can effectively address current global trade challenges". Viewed at: 
https://www.consilium.europa.eu/en/press/press -releases/2019/06/17/effective -multilateralism -council -
adopts -conclusions/ . 
42 European Commission, WTO modernisation – Introduction to future EU proposals . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/september/tradoc_157331.pdf . 
43 WTO documents JOB/GC/204/Rev.2 -JOB/CTG/14/Rev.2, 27 June 2019 and WT/GC/777/Rev.3, 
3 October 2019.  WT/TPR/S/395 • European Union  
 
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  participates in discussions on WTO reform in various other settings, including the Ottawa Group44, a 
trilater al process launched in December 2017 in the margin of the 11th WTO Ministerial Conference 
with Japan and the United States on non -market -oriented policies and practices, state enterprises, 
industrial subsidies, and forced technology transfers, and a joint EU-China Working Group on 
WTO reform created in 2018. The EU underlined the urgent need to resolve the impasse that has 
arisen because of the absence of consensus on the appointment of Appellate Body members, and 
co-sponsored several proposals in this rega rd.45  
2.27.   The EU is an active participant in the work of the regular WTO bodies and in several initiatives 
on investment facilitation, micro, small and medium -sized enterprises (MSMEs), electronic 
commerce, and domestic regulation in services launched in Decem ber 2017 on the occasion of the 
11th WTO Ministerial Conference. The EU and its member States endorsed the Declaration on Trade 
and Women's Economic Empowerment, adopted on the same occasion. Pursuant to this Declaration, 
the EU co -hosted a workshop on "Wo men in Digital Trade", together with Trinidad and Tobago, 
Senegal, the ITC, the WTO, and UNCTAD, in Geneva on 1 July 2019.  
2.28.   During the review period, the EU submitted numerous notifications to the WTO on, inter alia , 
agriculture, trade remedies, technical r egulations, regional trade agreements (RTAs), and 
preferential rules of origin (Table A2.1). It was a complainant in five new dispute settlement cases 
and a respondent in one new case (Table A2.2)  
2.3.2   Regional and preferential agreements  
2.3.2.1   Reciprocal preference s 
2.29.   As at 30 September 2019, the EU had 41 FTAs in force with 72 countries (Table A.2.3).  
2.30.   The EU divides its FTAs with third countries into four broad categories:  
• "first-generation FTAs" are agreements concluded before 2006 and Stabilisation and 
Association  agreements concluded with Western Balkan countries between 2009 and 
2016.46 First-generation FTAs are in force with: Mediterranean partners (Algeria, Egypt, 
Israel, Jordan, Lebanon, Morocco, Palestine, and Tunisia), Western Balkan partners 
(Albania, Bosnia  and Herzegovina, North Macedonia, Kosovo47, Montenegro, and Serbia), 
Chile, Mexico, Andorra, the Faroe Islands, Iceland, Norway, San Marino, Switzerland, and 
Turkey.  
• "new-generation FTAs" are comprehensive FTAs, negotiated by the EU after 2006, with 
selected third countries, which typically go beyond provisions on liberalization of trade in 
goods. They cover services and public procurement. In some cases, they also cover 
investment and regulatory cooperation. Since 2010, all new -generation agreements 
include provisions on sustainable development.48 New-generation FTAs are currently in 
force with: Japan; Canada; Korea, Rep. of; Colombia/Ecuador/Peru; and Central America.  
• "deep and comprehensive FTAs" are agreements aimed at establishing comprehensive free 
trade areas as part of a process of deepening political association and gradual economic 
integration between the EU and its partners.49 Deep and comprehensive FTAs are in force 
with: Ukraine, Georgia and Moldova, Rep. of.  
                                                
44 Australia; Brazil; Canada; Chile; EU; Japan; Kenya; Korea, Rep. of; Mexico; New Zealand; Norway; 
Singapore; and Switzerland.  
45 WTO documents WT/GC/W/7 53/Rev.1, 11 December 2018, and WT/GC/W/752/Rev.2, 
11 December  2018.  
46 European Commission, Individual reports and info sheets on implementation of EU Free Trade 
Agreements,  p. 113. Viewed at: https://trade.ec.europa.eu/doclib/docs/2018/october/tradoc_157473.PDF . 
47 All references to Kosovo in this report should be understood in the context of UNSC 1244/1999.  
48 European Commission, Individual reports and info sheets on implementation of EU Free Trade 
Agreements , p. 15. 
49 European Commission, Individual reports and i nfo sheets on implementation of EU Free Trade 
Agreements , p. 71. WT/TPR/S/395 • European Union  
 
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  • Economic partnership agreements (EPA s) with African Caribbean and Pacific (ACP) 
countries are in force with : the Southern African Development Community (SADC), 
Côte d'Ivoire, Ghana, Cameroon, CARIFORUM, the Pacific States, and the Eastern and 
Southern African States.  
2.31.   FTAs of the EU with thi rd states currently cover 32% of EU trade in goods, and cover 45% 
when FTAs that have not yet entered into force or that are under negotiation are included.50 Based 
on data on trade in goods, the largest FTA partners in 2018 were Switzerland (accounting for  8% of 
EU exports and 6% of EU imports), Turkey (4% of each), Norway (3% and 4%, respectively) and 
the Republic of Korea (3% of each).  
2.32.   As noted above, the negotiation of new FTAs is a key objective of the EU's Trade for All 
Strategy, and of its balanced a nd progressive trade policy agenda. A recent EU Trade Chief Economist 
Note observed that "[t]he last half decade has been the most prolific ever for the EU in terms of 
concluding FTAs with the rest of the world".51 During the review period, FTAs with Canada  and Japan 
entered into force, and FTAs with Singapore and Viet Nam were completed. In several cases, 
negotiations on FTAs were concluded at a political level and new FTA negotiations were launched 
with some partners. The new -generation FTAs are characteri zed by their broad scope, high level of 
ambition, and innovative features in areas such as investment and sustainable development. Aside 
from the new economic opportunities expected to be generated by these recent FTAs, the EU stresses 
their strategic bene fits. In a more uncertain and unstable international trading environment, it 
regards these FTAs as important signals of a shared commitment to open trade and a willingness to 
pursue international cooperation to shape global trade in accordance with common values.  
2.33.   The CETA between Canada, on the one hand, and the EU and its member States, on the other, 
signed on 30 October 2016, provisionally entered into force on 21 September 2017.52 Canada ratified 
it in May 2017. It will enter into force fully and definit ively when ratified by all EU member States. 
As at 30 September 2019, 13 member States had notified the completion of their ratification 
processes. The CETA was notified to the WTO on 19 September 2017, and was considered in the 
Committee on Regional Trade  Agreements in June 2018.53 In 2018, the Commission characterized 
the CETA as "the most ambitious and progressive trade agreement the EU has concluded to date 
and the most far -reaching, both in terms of market access and trade rules, in particular in settin g 
new standards for investment rules.".54 The CETA resulted in the elimination of duties for 97% of 
tariff lines on imports of products originating in the EU and for 97.7% of tariff lines on imports of 
products originating in Canada as from the date of its entry into force. Transition periods for the 
elimination of duties on the remaining products mean that, by 2024, almost 99% of duties on imports 
of products originating in the EU and Canada will be abolished. In the case of certain agricultural 
products, m arket access will be improved through tariff rate quotas. Some products are excluded 
from the process of tariff elimination.55  
                                                
50 European Commission, Trade for You Too: Why is trade more important than you think?  Chief 
Economist Note , Issue 1, pp.33 -34. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2019/may/tradoc_157903.pdf .  
51 European Commission, Trade for You Too: Why is trade more important than you think? p.  33.  
52 The text of the CETA was published in  Official Journal (OJ) , L 11 /23, 14 January 2017. Viewed at: 
https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=uriserv:OJ.L_.2017.011.01.0023.01.ENG&toc=O J:L:2017:011:TOC . The provisional 
application of the CETA does not apply to its provisions on investment protection, market access for portfolio 
investment, and the Investment Court System.  
53 WTO documents WT/REG389/N/1 and S/C/N//896, 21 September 2017, W T/REG389/1/Rev.1, 
26 June 2018, WT/REG389/2, 6 June 2018 and WT/REG389/M/1, 27 June 2018.  
54 European Commission, Individual reports and info sheets on implementation of EU  Free Trade 
Agreements , p. 20. The 30 chapters of the CETA contain disciplines on trade in goods; trade remedies; 
technical barriers to trade; sanitary and phytosanitary measures; customs and trade facilitation; subsidies; 
investment (establishment and protection of investment and settlement of investment disputes between  
investors and states); cross -border trade in services; temporary entry and stay of natural persons for business 
purposes; mutual recognition of professional qualifications; domestic regulation; financial services; 
international maritime transport services ; telecommunications; electronic commerce; competition policy; state 
enterprises, monopolies, and enterprises granted special rights or privileges; government procurement; IP, 
regulatory cooperation, trade and sustainable development; trade and labour; tra de and the environment; 
transparency; and dispute settlement. For details, see the Factual Presentation prepared by the WTO 
Secretariat in document WT/REG/389/1/Rev.1, 26 June 2018.  
55 WTO document WT/REG/389/1/Rev.1, 26 June 2018.  WT/TPR/S/395 • European Union  
 
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  2.34.   The EPA between the EU and Japan (EU -Japan EPA) was signed on 17 July 2018 and entered 
into force on 1 February 2019.56 It was not ified to the WTO in January 2019.57 It achieves a 
comprehensive level of liberalization of trade in goods and services and of investments; it includes 
provisions on IP (including geographical indications) and government procurement; and it lays down 
rules o n sustainable development, among other elements. Some innovative features of the EU -Japan 
EPA include the express reference to the Paris Agreement on Climate Change, a chapter aimed at 
supporting the use of the Agreement by small and medium -sized enterpris es (SMEs), and provisions 
on corporate governance. Unlike the CETA, the EU -Japan EPA does not contain provisions on 
investment protection or the settlement of investment disputes between investors and states. 
Separate negotiations between Japan and the EU for the conclusion of an Investment Protection 
Agreement are ongoing.  
2.35.   The FTA between the EU and Singapore and the Investment Protection Agreement between 
the EU and its member States and Singapore58 were signed on 19 October 2018 and received the 
consent o f the European Parliament on 13 February 2019. Once officially concluded by the Council, 
the FTA can enter into force. The Investment Protection Agreement will firstly also have to be ratified 
by member States according to their respective internal procedu res. The FTA with Singapore, the 
first EU FTA with a country in Southeast Asia, is seen as a building block towards the conclusion of 
an FTA with ASEAN.59 It covers provisions on national treatment and market access; trade remedies; 
technical barriers to tr ade; sanitary and phytosanitary measures; customs and trade facilitation; 
non-tariff barriers to trade and investment in renewable energy generation; services, establishment 
and electronic commerce; government procurement; IP; competition and related matte rs; trade and 
sustainable development; and dispute settlement.  
2.36.   The FTA between the EU and Viet Nam and the Investment Protection Agreement concluded 
between the EU and its member States and Viet Nam were signed on 30 June 2019 and were 
submitted to the European Parliament for its consent. Once the Parliament gives its  consent, the 
FTA can be officially concluded by the Council, and will enter into force. T he Investment Protection 
Agreement will firstly also have to be ratified by member States according to their respective internal 
procedures. The EU -Viet Nam FTA is similar in scope to the EU's FTA with Singapore, but also includes 
some further topics, such as a chapter on state enterprises, monopolies and enterprises with special 
rights. It has been described as the most ambitious FTA ever concluded by the EU with a developing 
country.60  
2.37.   In April 2018, the EU and Mexico reached agreement in principle on the modernization of the 
trade part of the EU -Mexico association agreement, which will render it comparable in scope and 
level of ambition to the recent EU FTAs.61 Negotiations with Chile on a similar modernization of the 
trade part of the EU -Chile association agreement were launched in November 2017.62 Negotiations 
                                                
56 The text of the EU -Japan EPA was published in OJ, L 330/3, 27 December 2018. Viewed at: 
http://publications.europa.eu/resource/cellar/d40c8f20 -09a4-11e9-81b4-01aa75ed 71a1.0006.01/DOC_1 . 
57 WTO documents WT/REG396/N/1 and S/C/N/921, 14 January 2019. The EU -Japan EPA contains 
chapters on trade in goods; rules of origin and origin procedures; customs matters and trade facilitation; trade 
remedies; sanitary and phytosanitar y measures; technical barriers to trade; trade in services, investment 
liberalization and electronic commerce; capital movements, payments and transfers, and temporary safeguard 
measures; government procurement; competition policy; subsidies; state -owned e nterprises, enterprises 
granted special rights or privileges, and designated monopolies; IP; corporate governance; trade and 
sustainable development; transparency; good regulatory practices and regulatory cooperation; cooperation in 
the field of agricultur e; SMEs; and dispute settlement. The WTO Secretariat's factual description of this 
agreement was circulated in document WT/REG396/1, 12 August 2019.  
58 EU-Singapore trade and investment agreements. Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=961 . 
59 European Commission, Agreement with Singapore set to give a boost to EU -Asia trade . Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1980 . 
60 European Parliament, EU-Vietnam free trade agreement.  Viewed at: 
https://www.europarl.europa. eu/RegData/etudes/BRIE/2018/614702/EPRS_BRI(2018)614702_EN.pdf . 
61 According to a summary of the agreement reached in 2018, the modernized agreement will cover 
provisions on trade in goods; rules of origin; customs and trade facilitation; trade remedies; sa nitary and 
phytosanitary measures; animal welfare and antimicrobial resistance; energy and raw materials; technical 
barriers to trade; services; investment; public procurement; competition; IP rights; trade and sustainable 
development; transparency; good r egulatory practice; SMEs; anti -corruption; and dispute settlement. Viewed 
at: http://trade.ec.europa.eu/doclib/docs/2018/april/tradoc_156791.pdf . 
62 European Commission, Modernisation of the trade part of the EU -Chile Association Agreement . Viewed 
at: http://ec.europa.eu/trade/policy/countries -and-regions/countries/chile/ . WT/TPR/S/395 • European Union  
 
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  with Mercosur on the conclusion of an association agreement, which had resumed in 2016, were 
concluded at t he political level at the end of June 2019.  
2.38.   Negotiations with Tunisia on a deep and comprehensive free trade area (DCFTA), launched in 
October  2015, continued during the review period. Negotiations with Morocco on the same type of 
agreement have been on h old since 2014.63 The DCFTAs will complement and modernize the current 
legal framework for trade relations between the EU and Tunisia and Morocco, called the 
Euro-Mediterranean Association Agreements. The key objective of these DCFTAs is to support 
Tunisia' s and Morocco's development and reform agendas, the enhancement of their export 
competitiveness, and their better integration into regional and global value chains.  
2.39.   In June 2018, the EU launched negotiations for comprehensive trade agreements with 
Australi a64 and New Zealand.65 
2.40.   The United States and the EU adopted a Joint Statement in July 2018, in which they agreed 
to work towards elimination of tariffs, non -tariff barriers, and subsidies on non -auto industrial goods, 
and towards the reduction of barriers to  trade in services, chemicals, pharmaceuticals, medical 
products and soybeans.66 The Statement also provides for a strengthening of strategic cooperation 
with respect to energy, and notes that the EU wants to increase imports of liquefied natural gas from 
the United States to diversify its energy supply. It envisages a close dialogue on standards, to reduce 
bureaucratic obstacles to trade and slash costs. Additionally, the United States and the EU agreed 
to join forces to better protect their companies from unfair trade practices and to work closely with 
likeminded partners to reform the WTO. Finally, the two sides agreed to work together to resolve 
the steel and aluminium tariff issues and retaliatory tariffs. The Statement established an Executive 
Working G roup to implement this agenda. In April 2019, the Council of the EU adopted decisions 
authorizing the opening of negotiations with the United States of agreements on the elimination of 
tariffs for industrial goods, and on conformity assessment.67 The Counci l decision on the former 
notes that "the negotiating directives for the Transatlantic Trade and Investment Partnership must 
be considered obsolete and no longer relevant".68  
2.41.   The EU maintains the European Economic Area (EEA) Agreement with Iceland, Liechten stein 
and Norway, permitting these countries to participate in the internal market for free movement of 
goods (except for agricultural and fisheries products), services, capital and labour. However, 
negotiations on further liberalization of agricultural pr oducts are part of the EEA Agreement. 
Agreements concluded in 2015 between the EU and Iceland on geographical indications for 
agricultural products and the improvement of market access for agricultural products entered into 
force on 1 May 2018. An agreemen t concluded in 2017 between the EU and Norway on additional 
preferences for certain agricultural products69 entered into force on 1 October 2018.  
2.42.   The EU has customs unions with Andorra and Turkey that cover trade in industrial products 
(HS 25 -97) and one wi th San Marino that covers all goods (except coal and steel). It is currently in 
the process of negotiating an association agreement with Andorra, Monaco and San Marino (AMS) 
the aim of which is to allow AMS to participate in the EU's internal market. The c ustoms union with 
Andorra will be extended to cover agricultural products, while that with San Marino will be extended 
without a change in scope of product coverage. In June 2018, the Council decided that no further 
work regarding the modernization of the EU-Turkey customs union would be foreseen.  
                                                
63 European Co mmission, The texts proposed by the EU for a Deep and Comprehensive Free Trade Area 
(DCFTA) with Tunisia. Viewed at: 
http://trade.ec.europa.eu/doclib/press/index. cfm?id=1490&serie=1106&langId=en . 
64 European Commission, EU-Australia Trade Agreement negotiations . Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1865 . 
65 European Com mission, EU-New Zealand Trade Agreement negotiations . Viewed at:  
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1867 . 
66 European Commission, Joint EU -U.S. Statement following Pre sident Juncker’s visit to the White 
House.  Viewed at : http://trade.ec.europa.eu/doclib/press/index.cfm?id=1898 . 
67 European Commission, EU-US Trade: Commission welcomes Council's green  light to start negotiations 
with the United States.  Viewed at: http://trade.ec.europa.eu/doclib/press/index.cfm?id=2010 . 
68 Council Decision authorizing the opening of negotiations with the United States on the elimination of 
tariffs for industrial goods. Viewed at: https://www.consilium.europa.eu/med ia/39180/st06052 -en19.pdf .  
69 The text of the Agreement was published in OJ L 129/3, 25 May 2018. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=OJ:L:2018:129:FULL&from=GA . WT/TPR/S/395 • European Union  
 
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  2.43.   Trade between the EU and Switzerland is governed by the FTA concluded in 1972, which only 
covers trade in goods, and approximately 120 bilateral sectoral agreements, some of them of trade 
relevance, notably on ag ricultural products and processed agricultural products, public procurement, 
technical barriers to trade, and free movement of persons. Negotiations to further liberalize trade in 
agricultural products with Switzerland are on hold. The conclusion of an Ins titutional Framework 
Agreement has been under discussion since 2014. This would cover the five major sectoral 
agreements, on free movement of persons, mutual recognition of conformity assessment, 
agricultural products, air transport, and road transport.  
2.44.   The majority of the ACP countries are either implementing an EPA or have concluded 
negotiations on an EPA with the EU.70 EPAs are implemented by 31 countries in the Caribbean, the 
Pacific71, Eastern and Southern Africa72, Central Africa73, West Africa74, and mem ber States of the 
SADC. Regional EPAs concluded with countries in West Africa and with the East  African Community 
have yet to be signed by all the Parties before they can enter into force. The Communication on a 
New Africa –Europe Alliance for Sustainable Invest ment and Jobs, adopted in September 2018, 
highlighted the role of the EPAs concluded with countries in Africa as building blocks to the benefit 
of the construction of the African Continental Free Trade Area (ACFTA) and suggested that, building 
on the implementation of the Area, the long -term perspective was to create a comprehensive 
continent -to-continent FTA between the EU and Africa.75  
2.3.2.2   Unilateral preferences  
2.45.   The EU Generalised Scheme of Preferences (GSP), introduced in 1971 and implemented 
through su ccessive Council regulations, provides preferential access to the EU market, to assist 
developing countries in their efforts to reduce poverty and promote sustainable development and 
good governance. The current GSP Regulation76 is the product of a reform t hat pursued three main 
objectives: (i) to contribute to poverty eradication by expanding exports from countries most in 
need; (ii) to promote sustainable development and good governance; and (iii) to ensure better 
safeguards for the EU's financial and econ omic interests. It entered into force in January 2014 for a 
period of ten years.  
2.46.   The GSP provides a general GSP arrangement and two special arrangements.  
2.47.   The general arrangement ( Standard GSP ) grants duty suspensions (non -sensitive products) 
or duty reduc tions (sensitive products) for about 66% of all EU tariff lines to countries of low or 
lower -middle income status, which do not benefit from other preferential trade access to the 
EU market. As at 30 September 2019, there were 15 Standard GSP beneficiaries : Congo, 
Cook Islands, India, Indonesia, Kenya, Micronesia, Nauru, Nigeria, Niue, Samoa, Syria, Tajikistan, 
Tonga, Uzbekistan, and Viet Nam.77  
2.48.   The GSP Regulation provides that tariff preferences under the Standard GSP shall be 
suspended if the average valu e of imports of a product originating in a GSP country over three 
consecutive years exceeds the threshold listed in an annex to the Regulation. Based on this 
provision, the Commission adopted an implementing regulation in 2016, suspending tariff 
preference s for the period 2017 -19 in respect of certain products originating in India, Indonesia, 
                                                
70 European Commission, Economic Partnership Agreements (EPAs) . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2017/february/tradoc_155300.pdf . 
71 Fiji and Papua New Guinea.  
72 Madagascar, Mauritius, Seychelles and Zimbabwe.  
73 Cameroon.  
74 Côte d' Ivoire and Ghana. The regional EPA has yet to be signed by all the parties before it can enter 
into force.  
75 European Commission, Communication on a new Africa –Europe Alliance for Sustainable Investment 
and Jobs: Taking our partnership for investment and j obs to the next level . Viewed at: 
https://ec.europa.eu/commission/sites/beta -political/files/soteu2018 -africa -europe -jobs-alliance -
communication -643_en.pdf . 
76 Regulation (EU) No . 978/2012 of the European Parliament and of the Council of 25 October 2012, 
applying a scheme of generalised tariff preferences. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32012R0978&from=EN . 
77 At the time of the previous Review, there were 19 Standard GSP beneficiaries, including Côte d'Ivoire, 
Ghana, Swaziland, and Ukraine, all of which have since left the Scheme.  WT/TPR/S/395 • European Union  
 
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  Kenya and Ukraine.78 It adopted a similar regulation in February 2019, suspending tariff preferences 
for the period 2020 -22 in respect of certain products originating i n India, Indonesia and Kenya.79  
2.49.   The Special Incentive Arrangement for Sustainable Development and Good Governance 
(GSP+) grants complete duty suspension for essentially the same 66% of tariff lines as the Standard 
GSP, for countries which are especially vu lnerable in terms of their economies' diversification and 
export volumes, and which have ratified, and effectively implemented, 27  core international 
conventions.80 To apply for the GSP+ scheme, a country must: (i) meet the thresholds for being 
considered a  vulnerable economy in terms of its import share to the EU and the diversification of 
those imports; (ii) have ratified and implemented the 27 conventions; (iii) not have formulated 
reservations that are prohibited under the conventions or could be conside red incompatible with the 
GSP Regulation; and (iv) sign a binding undertaking to cooperate with the United Nations (UN) 
system and the Commission in monitoring implementation. Failure to comply with these 
requirements could result in the suspension of the tariff concession. As at 30 September 2019, there 
were eight GSP+ beneficiaries: Armenia, Bolivia, Cabo Verde, the Kyrgyz Republic, Mongolia, 
Pakistan, the Philippines and Sri Lanka.81  
2.50.   The Everything But Arms (EBA) special arrangement grants full duty-free, quota -free access 
for all products except arms and ammunition, for countries classified by the UN as least -developed 
countries (LDCs). As at 30 September 2019, there were 48 EBA beneficiaries.82 The EU launched a 
process of enhanced engagement wi th three EBA beneficiaries (Bangladesh, Cambodia, and 
Myanmar) in respect of their compliance with certain international conventions on human and labour 
rights, the violation of which can be a ground for the temporary withdrawal of tariff preferences 
provided under any of the three GSP arrangements.83 In February 2019, the EU initiated the 
procedure provided for in the GSP Regulation that might lead to the temporary withdrawal of tariff 
preferences provided to Cambodia.84 The EU will adopt a decision on this matter in February 2020 .  
2.51.   The GSP Regulation provides that safeguard measures may be applied, through the 
reintroduction of the Common Customs Tariff duty, if a product originating in a GSP beneficiary 
country is imported in volumes and/or at prices which cause, or threaten to cause, serious difficulties 
to EU producers of like or directly competing products. In January 2019, the Commission adopted a 
regulation imposing such safeguard measures on imports of Indica rice from Cambodia and 
Myanmar. The import duties under this Regulation will be imposed for a period of three years, and 
will be progressively reduced.85  
                                                
78 Commission Implementing Regulation (EU) 2016/330 of 8 March 2016 suspending t he tariff 
preferences for certain GSP beneficiary countries in respect of certain GSP sections in accordance with 
Regulation (EU) No . 978/2012 applying a scheme of generalised tariff preferences for the period of 2017 -19, 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32016R0330&from=EN . 
79 Commission Implementing Regulation (EU) 2019/249 of 12 February 2019 suspending the tariff 
prefere nces for certain GSP beneficiary countries in respect of certain GSP sections in accordance with 
Regulation (EU) No . 978/2012 of the European Parliament and of the Council applying a scheme of generali zed 
tariff preferences for the period of 2020 -22. Viewe d at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019R0249&from=EN . 
80 These include seven conventions on human rights, eight work -related c onventions of the International 
Labour Organization (ILO), eight conventions on environmental protection and climate change, and four good 
governance conventions under UN auspices against corruption and the control of illegal drugs.  
81 Sri Lanka joined the GSP+ in 2017. Georgia ceased to benefit from the GSP+ after it obtained 
preferential access to the EU market under its DCFTA with the EU. Paraguay left the GSP+ in January 2019 as 
a result of a change in its economic status, as it had been classified by th e World Bank as an upper 
middle -income country for three consecutive years.  
82 At the time of the previous Review, there were 49 EBA beneficiaries. Samoa ceased to benefit from 
the EBA arrangement when it graduated from LDC status in January 2019.  
83 Chapt er V, GSP Regulation.  
84 Commission Implementing Decision of 11 February 2019 on the initiation of the procedure for 
temporary withdrawal of the tariff preferences provided to the Kingdom of Cambodia under Article 19 of 
Regulation (EU) No . 978/2012. Viewed  at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019D0212(02)&from=EN . 
85 Commission Implementing Regulation (EU) 2019/67 of 16 January 2019 imposing safeguard 
measures with regard to imports of Indica rice originating in Cambodia and Myanmar/Burma. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32019R0067&from=NL . WT/TPR/S/395 • European Union  
 
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  2.52.   In January 2018, the Commission published its second biennial report to the Parliament and 
the Council on the effects of the reformed GSP during the period 2016 -17.86 The report focused on 
the performance of the ten countries that were GSP+ beneficiaries during this period (Armenia, 
Bolivia, Cabo Verde, Georgia, the Kyrgyz Republic, Mongolia, Pakistan, Paraguay, the Philippines and 
Sri Lanka). It no ted the countries' progress and shortcomings. The third biennial report , covering 
the period 2010 -19, is expected to be published in December 2019 or January 2020.   
2.53.   In October 2018, the Commission published a report reflecting the main results of a 
compreh ensive mid -term evaluation of the GSP.87 The report indicated that the share of imports 
under the GSP in total EU imports is relatively modest, and declined from 5.8% in 2011 to 4.1% in 
2016.88 It offered the following observations, based on an evaluation of  the GSP in light of the 
three  general objectives of the 2012 reform. Firstly, in relation to the objective of contributing to 
poverty reduction by expanding exports from countries most in need, the effectiveness of the GSP 
was enhanced by focusing better on countries most in need. Secondly, the GSP had an overall 
positive impact on social development and human rights in the beneficiary countries. Thirdly, the 
reform improved provisions to protect the EU's financial and economic interests, in that products 
that are too competitive are regularly removed from the Scheme. Overall, the report concluded that 
there was no need to amend the GSP Regulation before its expiry on 31 December 2023 but that 
measures should be taken to improve transparency and inclusivene ss in GSP+ monitoring, both in 
the EU and in the beneficiary countries, and to promote greater awareness of GSP in beneficiary 
countries.  
2.4  Investment Regime  
2.4.1   Investment and the EU internal market  
2.54.   As a general rule, the TFEU prohibits all restrictions on ca pital movements and on payments 
among EU member States, and between EU member States and non -members. The free movement 
of capital may be restricted based on the exceptions89 provided for in the TFEU or for overriding 
reasons of general interest as defined in the case law of the CJEU, provided that the restrictions are 
necessary and proportionate to the achievement of the public objective pursued. Under the TFEU, 
no restrictions are in principle allowed on the freedom of establishment of an EU  national in th e 
territory of another member State. Freedom of establishment extends to EU  subsidiaries affiliated 
to non -EU companies90, but not to branches or agencies of non -EU companies.  
2.55.   The removal of regulatory barriers to investment in the EU is one of the three m ain pillars of 
the Investment Plan for Europe, launched in 2014. The Plan pursues three main objectives in this 
regard: (i) improvement of the quality of regulation at all levels; (ii) development of new sources 
for long -term financing, including through t he establishment of a Capital Markets Union; and 
(iii) reinforcing the level playing field and eliminating barriers to investment in the single market, 
notably through the removal of barriers to investment in the energy and transport sectors, the 
creation of a Digital Single Market, and the elimination of obstacles to the proper functioning of 
services and product markets.91 In the implementation of the latter, the Commission divided the 
main challenges to investment that require reforms into five categories : (i) public 
administration/business environment; (ii) labour market/education; (iii) financial sector/taxation; 
(iv) research, development and innovation; and (v) sector -specific regulation.  
2.56.   The Commission reported, in 2018, that member States had made s ignificant progress in 
providing favourable investment conditions. However, it considered that major challenges continued 
                                                
86 European Commission, Report on the Generalised Scheme of Preferences covering the period 
2016-17. Viewed at: https://trade.ec.europa.eu/doclib/docs/2018/january/tradoc_156536.pdf .  
87 European Commission, Report from the Commission to the European Parliament and the Council on 
the application of Regulation (EU) N o. 978/2012 applying a Scheme of Generalised Tariff Preferences and 
repealing Council Regulation (EC) No. 732/2008 . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/o ctober/tradoc_157438.PDF . 
88 European Commission, Report from the Commission to the European Parliament and the Council on 
the application of Regulation (EU) No. 978/2012 applying a Scheme of Generalised Tariff Preferences and 
repealing Council Regulation ( EC) No. 732/2008,  pp. 2-3. 
89 See in particular Arts. 64 -66, TFEU.  
90 Arts. 49 and 54, TFEU.  
91 European Commission, An Investment Plan for Europe . Viewed at: 
http:/ /ec.europa.eu/transparency/regdoc/rep/1/2014/EN/1 -2014-903-EN-F1-1.Pdf. WT/TPR/S/395 • European Union  
 
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  to exist, and that member States should step up their efforts to implement the necessary reforms 
to remove obstacles to investment; in  this regard, it stressed the importance of effective justice 
systems.92 The need to improve conditions for investment within the EU also featured prominently 
in the 2019 European Semester process. The Commission noted in that context that "all Members 
experienced barriers to investment in different policy areas" and that "[a]mong the most frequently 
cited impediments to investment in the EU are inefficiencies in public administration, unfavourable 
conditions for doing business, and high administrative and r egulatory burden[s] for specific 
sectors".93 Accordingly, the country -specific recommendations submitted by the Commission in the 
2019 European Semester feature a deeper focus on investment.94  
2.57.   The period under review saw important developments regarding the  status under EU  law of 
bilateral investment agreements between EU member States. Intra -EU bilateral investment 
agreements were often concluded at a time when one of the two parties was not yet an EU member.95 
The Commission has consistently considered such  agreements to be incompatible with EU law and, 
in 2016, requested certain member States to terminate them. The Commission "intensified its 
dialogue" with member States in this regard following a ruling of the CJEU in 2018, confirming that 
investor -state a rbitration clauses in intra -EU bilateral investment agreements are contrary to 
EU law.96 In January 2019, all member States signed political declarations in which they committed 
to terminating their intra -EU bilateral investment agreements by the end of 201 9.97  
2.4.2   Investment relations with third countries  
2.58.   The Commission defines the objectives of EU investment policy as to: secure a level playing 
field so that EU investors abroad are not discriminated against or mistreated; make it easier to invest 
by creating a predictable and transparent business environment; promote investment that supports 
sustainable development, respect for human rights and high labour and environmental standards; 
attract international investment into the EU, while protecting the EU's esse ntial interests; and 
preserve the right of home and host countries to regulate their economies in the public interest.98  
2.4.2.1   Establishment of a cooperation mechanism for the screening of FDI  
2.59.   A key development during the review period was the preparation and adoption of legislation 
providing for the establishment of an EU framework for the screening of FDI. While no EU -wide 
mechanism exists for the review of inward investment from third countries based on considerations 
relating to security or public order99, 15 EU member States currently have national mechanisms 
                                                
92 European Commission , Investment Plan for Europe: stock -taking and next steps , and Annexes 1 and 
2. Viewed at: https://ec.europa.eu/commission/sites/beta -
political/files/communication_investment_plan_for_europe_nov2018.pdf . 
93 European Commis sion, 2019 European Semester: Assessment of progress on structural reforms, 
prevention and correction of macroeconomic imbalances, and results of in -depth reviews under Regulation (EU) 
No. 1176/2011 , p. 15. Viewed at: https://ec.europa.eu/transparency/regdoc/rep/1/2019/EN/COM -2019-150-
F1-EN-MAIN -PART-1.PDF . 
94 European Commission, 2019 European Semester: country -specific recommendations. Viewed at: 
https://ec.europa.eu/info/sites/info/files/2019 -european -semester -country -specific -recommendations -
commission -recommendations -communication_en.pdf . 
95 According to UNCTAD data, the number of arbitration cases brought by an investor from one EU 
member State against another member State based on an investment agreement totalled 174 by 31 July 2018, 
which constitutes about 20% of the total 901 known investor -state dispute settlement proceedings globally. 
About 45 per cent of these intra -EU cases were brought pursuant to the Energy Charter Treaty. UNCTAD, Fact 
Sheet on Intra -European Union Investor -State Arb itration Cases . Viewed at: 
https://unctad.org/en/PublicationsLibrary/diaepcb2018d7_en.pdf . 
96 Judgment of the Court (Grand Chamber) of 6 March 2018, Case C -284/16, Slowakische Re publik v 
Achmea BV, EU:C:2018:158. Viewed at: 
http://curia.europa.eu/juris/document/document.jsf?text=&d ocid=199968&pageIndex=0&doclang=EN&mode=
lst&dir=&occ=first&part=1&cid=3823964 ; see also European Commission, Protection of intra -EU Investment . 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52018DC0547&from=EN . 
97 Declarations of the Representatives of the Governments of the member States, of 15 and 
16 January  2019, on the Legal Consequences of the Judgment of the Court of Justice in Achmea and on 
Investment Protection in the European Union. Viewed at:  https://ec.europa.eu/info/publications/190117 -
bilateral -investment -treaties .  
98 European Commission, Objectives of EU investment policy.  Viewed at: 
http://ec.europa.eu/trade/policy/accessing -markets/investment/ . 
99 Review at the EU level of a foreign investment transaction under the Merger Regulation is based on 
criteria relat ing to the impact of a proposed merger on competition.  WT/TPR/S/395 • European Union  
 
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  enabling them to screen inward investment on that basis.100 These screening mechanisms vary 
significantly with respect to factors such as whether they apply only to extra -EU investment or to 
both intra - and extra -EU investment; the type of criteria used to define the investment to be 
reviewed; the sectors covered by the screening mechanism; whether the grounds for screening are 
limited to defence -related national security interests or inclu de the protection of broader public 
policy; and whether the screening is in the form of a prior authorization procedure or of an ex post  
mechanism.101  
2.60.   The European Commission President proposed the creation of an EU framework for FDI 
screening in the 2017 S tate of the Union address.102 The proposal was motivated by growing 
concerns regarding the impact on the strategic interests of the EU or its member States of certain 
types of FDI, especially foreign acquisitions in cases involving state -owned enterprises an d strategic 
sectors.103 This legislation, a regulation based on the common commercial policy competence in 
Article 207(2) of the TFEU, was adopted on 19 March 2019, entered into force on 10 April 2019, and 
shall apply from 11 October 2020.104  
2.61.   The Regulation c onsists of two main pillars. It (i) provides for a framework for the screening 
by member States of FDI into the EU on the grounds of security or public order; and (ii) establishes 
a mechanism for cooperation between member States, and between member States  and the 
Commission, with regard to FDI likely to affect security or public order. The Regulation does not 
establish a centralized EU  mechanism for the screening of inward investments. FDI is defined in the 
Regulation as "an investment of any kind by a for eign investor aiming to establish or to maintain 
lasting and direct links between the foreign investor and the entrepreneur to whom or the 
undertaking to which the capital is made available in order to carry on an economic activity in a 
Member State, inclu ding investment which enable effective participation in the management or 
control of a company carrying out an economic activity".105  
2.62.   Regarding the first pillar – the establishment of a framework – it is important to note that the 
Regulation does not requir e member States to adopt screening mechanisms or to harmonize them. 
Rather, it provides that member States may maintain, amend or adopt mechanisms to screen FDI 
in their territory on the grounds of security or public order106, and lays down certain requireme nts 
that these screening mechanisms must satisfy with respect to the following factors: transparency 
and non -discrimination between third countries; the application of time -frames; the protection of 
confidential information; the right of foreign investors and the undertakings concerned to seek 
                                                
100 Austria, Denmark, Finland, France, Germany, Hungary, Italy, Latvia, Lithuania, the Netherlands, 
Poland, Portugal, Romania, Spain, and the United Kingdom. Insofar as such member State screening 
mecha nisms relate to national security and public policy considerations, their possible legal basis is Article 
346(1)(b) of the TFEU and/or one of the exceptions to the free movement of capital and payments.  
101 European Commission, Commission Staff Working Docum ent accompanying the document Proposal 
for a Regulation of the European Parliament and of the Council establishing a framework for screening of 
foreign direct investments into the European Union.  Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52017SC0297&from=EN . See also European Parliament, Foreign direct 
investment screening: A debate in light of China -EU FDI flows . Viewed at: 
https://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_BRI%282017%29603941 ; 
European Parliament, EU framework for FDI screening . Viewe d at: 
https://www.europarl.europa.eu/RegData/etudes/BRIE/2018/614667/EPRS_BRI(2018)614667_EN.pdf ; and 
Copenhagen Economics, Screening of FDI towards the EU . Viewed at: 
https://www.copenhageneconomics.com/dyn/resources/Publication/pub licationPDF/2/422/1516698849/copenh
agen-economics -2018-screening -of-fdi-towards -the-eu.pdf . 
102 European Commission, State of the Union 2017 -Trade Package: European Commission proposes 
framework for  screening of foreign direct investments . Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1716 . 
103 European Commission, Welcoming Foreign Direct Investment while Protecting Essential Interests . 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52017DC0494&from=EN . 
104 Regulation (EU) 2019/452 of the European Parliament and of the Council of 19 Ma rch 2019 
establishing a framework for the screening of foreign direct investment into the Union. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/ ?uri=CELEX:32019R0452&from=EN . 
105 Regulation (EU) 2019/452, Art. 2(1). Screening "means a procedure allowing to assess, investigate, 
authorise, condition, prohibit or unwind foreign direct investments". Regulation (EU) 2019/452, Art. 2(3). 
A screening mecha nism for purposes of the Regulation "means an instrument of general application, such as a 
law or regulation, and accompanying administrative requirements, implementing rules or guidelines, setting 
out the terms, conditions and procedures to assess, invest igate, authorise, condition, prohibit or unwind 
foreign direct investments on grounds of security or public order".  Regulation (EU) 2019/452, Art. 2(4) . 
106 Regulation (EU) 2019/452, Art. 3.  WT/TPR/S/395 • European Union  
 
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  recourse to screening decisions; the avoidance of circumvention of screening mechanisms and 
screening decisions; and the notification to the Commission of existing screening mechanisms and 
of the adoption of new scree ning mechanisms or amendments to existing ones.107  
2.63.   In addition, the Regulation defines the factors that may be taken into consideration by 
member States (or the Commission) in determining whether FDI is likely to affect security or public 
order. In this res pect, it provides that account may be taken of the potential effects of the investment 
on the following factors:  
"(a) critical infrastructure, whether physical or virtual, including energy, transport, water, 
 health, communications, media, data processing  or storage, aerospace, defence, 
 electoral or financial infrastructure, and sensitive facilities, as well as land and real 
 estate crucial for the use of such infrastructure;  
(b) critical technologies and dual use items as defined in point 1 of Article 2  of Council 
 Regulation (EC) No. 428/2009, including artificial intelligence, robotics, 
 semiconductors, cybersecurity, aerospace, defence, energy storage, quantum and 
 nuclear technologies as well as nanotechnologies and biotechnologies;  
(c) supply of cr itical inputs, including energy or raw materials, as well as food security;  
(d) access to sensitive information, including personal data, or the ability to control such 
 information; or  
(e) the freedom and pluralism of the media."108 
2.64.   Account may also be take n of whether the foreign direct investor is controlled by the 
government of a third country or has already been involved in activities affecting security or public 
order in a member State; or whether there is a serious risk that the foreign investor engage s in 
illegal or criminal activities.109  
2.65.   With regard to the second pillar - the mechanism for cooperation - the Regulation requires 
member States to notify the Commission and other member States of any FDI that is undergoing 
screening110, provides that other me mber States may submit comments to the member State 
undertaking the screening, and allows the Commission to issue an opinion to such member State, 
on its own initiative or at the request of the screening member State. Such opinion is legally 
non-binding.111 While the member State undertaking the screening must give due consideration to 
such comments and to the opinion of the Commission, the final screening decision shall be taken by 
that member State.112 Another aspect of the cooperation mechanism is the provis ion that a member 
State may submit comments to, and request information from, another member State if it considers 
that its security or public order is affected by FDI in another member  State that is not undergoing 
screening; the Commission may issue an op inion to, and request information from, a member State 
if it considers that FDI in that member State that is not being screened affects security or public 
order in more than one member State.113  
                                                
107 Member States were required to notify the Commission of existing screening mechanisms by 
10 May 2019. List of screening mechanisms notified by Member States . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2019/june/tradoc_157946.pdf . 
108 Regulation (EU) 2019/452, Art. 4(1).  
109 Regulation (EU) 2019/452, Arts. 4(2)(a) -(c). The Regulation does not include any criteria relating to 
whether the country of origin of the foreign investor grants reciprocal access to its market to EU investors.  
110 Article 9(2) specifies the information th at must be provided when a member State notifies the 
Commission and other member States that FDI in its territory is undergoing screening. This information 
includes: the ownership structure of the foreign investor and of the undertaking in which the invest ment is 
planned or has been completed; the value of the investment; the products, services and business operations of 
the foreign investor and of the undertaking in which the FDI is planned or has been completed; the member 
States in which the foreign inve stor and the undertaking in which the investment is planned, or has been 
completed, conduct relevant business operations; the funding of the investment and its source; and the date 
when the investment is planned to be, or was, completed.  
111 Under EU law, re commendations and opinions have no binding force. Art. 288, TFEU.  
112 Regulation (EU) 2019/452, Art. 6.  
113 Regulation (EU) 2019/452, Art. 7.  WT/TPR/S/395 • European Union  
 
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  2.66.   The cooperation procedure also covers situations in which the Commission considers that FDI 
is likely to affect projects or programmes of Union interest on grounds of security or public order. In 
such situations, the Commission may issue an opinion addressed to the member State where the 
FDI is planned, or has been c ompleted, and the member State must take utmost account of the 
opinion and provide an explanation to the Commission if it does not follow the opinion.114 The term 
"projects or programmes of Union interest" is defined to "include those projects and programmes  
which involve a substantial amount or a significant share of Union funding, or which are covered by 
Union law regarding critical infrastructure, critical technologies or critical inputs which are essential 
for security or public order".115 A list of these p rojects and programmes is contained in an annex to 
the Regulation.  
2.67.   Finally, the Regulation requires member States and the Commission to establish a contact 
point for the implementation of the Regulation, provides that the group of experts on the screening  
of FDI into the EU116 shall continue its work, and allows the member States and the Commission to 
cooperate with responsible authorities of third countries on issues relating to the screening of FDI 
on the grounds of security and public order.117  
2.4.2.2   Agreements with third countries  
2.68.   As noted above, following the advisory opinion of the CJEU of May 2017, the treatment of 
investment matters in EU agreements bifurcated. Trade agreements that deal only with matters 
within exclusive EU competence, and are concluded on ly by the EU, include market access provisions 
with respect to FDI. Investment protection issues are addressed in separate investment protection 
agreements that include matters that fall within EU -exclusive and shared EU and member State 
competences and th at are concluded by both the EU and the member States. These mixed 
EU investment protection agreements will replace bilateral investment agreements between 
individual EU member States and third countries.  
2.69.   The recent agreements with Singapore illustrate ho w investment is dealt with under the new 
architecture of EU trade and investment agreements. The FTA between the EU and Singapore 
provides that, with respect to market access through establishment, each Party shall accord 
establishments and entrepreneurs o f the other Party treatment no less favourable than that provided 
for under the terms, limitations and conditions agreed and specified in its Schedule of Specific 
Commitments. The protection of investment is treated separately in the Investment Protection 
Agreement between the EU and its member States on the one hand, and Singapore on the other. 
The Agreement adopts the broad, asset -based definition of investment which is typical of investment 
protection agreements. It reaffirms the Parties' right to regula te within their territories to achieve 
legitimate policy objectives; requires each Party to accord national treatment to covered investors 
and the covered investments of the other Party; requires each Party to accord fair and equitable 
treatment and full p rotection and security to covered investors of the other Party; requires each 
Party to accord compensation for losses owing to war or other armed conflict, revolution, a state of 
national emergency, revolt, insurrection or riot in the territory of the othe r Party; prohibits 
expropriation of investments except for a public purpose, in accordance with the due process of law, 
on a non -discriminatory basis, and against payment of prompt, adequate and effective 
compensation; and requires each party to permit all  transfers relating to a covered investment to 
be made in a freely -convertible currency without restriction or delay, subject to certain exceptions.  
2.70.   The dispute settlement provisions of the Investment Protection Agreement are similar to those 
of the CETA and reflect what is now commonly referred to as the Investment Court System. This 
new System results from a policy adopted by the EU in 2015 as part of the Trade for All Strategy, 
to work towards the reform of the traditional investor -state dispute settlem ent mechanism of 
international investment agreements. Instead of ad hoc  arbitration bodies, the System provides for 
a permanent Tribunal of First Instance and a permanent Appeal Tribunal to hear appeals from 
provisional awards issued by the Tribunal of Fir st Instance. The members of these Tribunals are 
                                                
114 Regulation (EU) 2019/452, Art. 8(2).  
115 Regulation (EU) 2019/452, Art. 8(3).  
116 This group of experts was established  by the European Commission in November 2017. Commission 
Decision of 29 November 2017 setting up the group of experts on the screening of foreign direct investments 
into the European Union. Viewed at: 
https://ec.europa.eu/transparency/regexpert/index.cfm?do=groupDetail.groupDetailDoc&id=36097&no=1 . 
117 Regulation (EU) 2019/452, Arts. 12 -13. WT/TPR/S/395 • European Union  
 
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  appointed in advance by the contracting parties, must meet specified requirements regarding 
expertise and qualifications, and are subject to strict rules of ethical conduct. The new rules also 
include detaile d provisions on the transparency of proceedings, notably through public access to 
documents, hearings and the possibility of third persons making submissions.118 In addition to the 
inclusion of provisions regarding the System in bilateral agreements, the EU is also pursuing the 
establishment of a multilateral investment court system119 and the reform of the investment 
provisions in the Energy Charter Treaty.  
2.71.   The EU is also negotiating a stand -alone investment agreement with China. In April 2019, the 
EU and Chi na committed to achieving, during 2019, the decisive progress required, notably with 
regard to liberalization commitments, for the conclusion of an ambitious EU -China Comprehensive 
Investment Agreement in 2020.120 
2.72.   EU foreign investment policy includes transi tion arrangements regarding bilateral investment 
treaties signed by EU member States with third countries before the entry into force of the Lisbon 
Treaty or the date of their accession to the EU. According to a notice published by the Commission 
in June 2 019121, more than 1,400 bilateral investment agreements were in force between 
EU member States and third states, which is more than half of the 2,353 bilateral investment 
agreements in force globally, according to the UNCTAD data base on international invest ment 
agreements.122 Regulation (EU) No. 1219/2012 lays down the conditions under which such treaties 
may be maintained until they are progressively replaced by investment agreements concluded by 
the EU.123 It also provides that the Commission may authorize mem ber States to negotiate with 
third states to amend existing treaties or conclude new ones, subject to certain conditions.  
 
                                                
118 On 30 April 2019, the CJEU ruled that the new System is  compatible with EU law. Opinion 1/17 of the 
Court (Full Court), 30 April 2019, Request for an opinion pursuant to Article  218(11) TFEU, made on 
7 September 2017 by the Kingdom of Belgium . Viewed at: 
http://curia.europa.eu/juris/document/document.jsf?text=&docid=213502&pageIndex=0&doclang=EN&mode=
lst&dir=&occ=first&part=1&cid=4976548 . 
119 Council of the EU, Ne gotiating directives for a Convention establishing a multilateral court for the 
settlement of investment disputes. Viewed at: http://data.consilium.europa.eu/doc/ document/ST -12981 -2017-
ADD-1-DCL-1/en/pdf . 
120 EU-China Summit Joint Statement, para. 4. Viewed at: 
https://www.consilium.europa.eu/media/39020/euchina -joint-statement -9april2019.pdf . 
121 List of bilateral investment agreements referred to in Article 4(1) of Regulation No . 1219/2012 of the 
European Parliament and of the Council establishing transitional arrangements for bilateral investment 
agreements between Memb er States and third countries. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52019XC0613(02)&from=EN . 
122 The UNCTAD data base indicates that the total number of bilateral investment agreements of 
EU member States, i.e. including both agreements with third states and with other EU member States, is 
1,655.  
123 Regulation (EU) No . 1219/2012 of the European Parliament and of the Council of 12 December 2012 
establishing transitional arrangements for bilateral investment agreements between member States and third 
countries. Viewed  at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2012:351:0040:0046:EN:PDF . WT/TPR/S/395 • European Union  
 
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  3  TRADE POLICIES AND P RACTICES BY MEASURE  
3.1  Measures Directly Affecting Imports  
3.1.1   Customs procedures, valuation, and requirements  
3.1.  The EU Customs Union recently celebrated its 50th anniversary of trading as a single entity in 
2018. It commenced in 1968 when a common customs tariff replaced the individual tariffs of the 
original six EEC member countries and allowed goods to flow free from duties and other trade 
restrictions. Since that time, other milestones along the way were the introduction of the single 
administrative document replacing numerous national customs declarations, and the Community 
Customs Cod e unifying the customs legislation and procedures.1 Today these first instruments still 
form the backbone of the Customs Union, although they have been improved, harmonized, and 
adapted to technological change.  
3.2.  The TFEU further defined the functions of the  Union and set out that the Customs Union is one 
of the exclusive competences of the EU. Importantly, it provides for uniform treatment for goods 
upon importation, exportation, or transit from the EU's customs territory. In cooperation, the 
national custom s' services of the 28 member States are responsible for the day -to-day work and 
implementation at the borders. In 2018, 89,652 customs officers2 at 2,007  border posts3 worked 
together to facilitate legitimate trade, collect payment of duties and taxes, and enforce the rules to 
counteract fraud, piracy, and counterfeiting. Almost 9 2% of import declarations under a standard 
procedure w ere cleared within 1 hour in 2018.4 
3.3.  Directorate -General for Taxation and Customs Union (TAXUD) is the Commission's service for 
customs matters. It works to support the trading interests of the EU, promote cooperation among 
member States, and create a coherent customs policy. As part of its str ategic vision for 2016 -20, 
DG TAXUD has identified proper implementation of the Union Customs Code (UCC) , the deployment 
of electronic systems, the management of the withdrawal of the United Kingdom, and the 
maintaining of close cooperation with national c ustoms administrations as the key goals or objectives 
during the period. As part of its ongoing work, DG TAXUD was testing new technologies, in particular 
blockchains, for their potential in various customs processes, such as the Import One Stop Shop 
(IOSS ) system  (Section 3.1.4).5  
3.4.  DG TAXUD also continues to work on the EU Single Window (SW) environment for customs 
initiative, which was launched in 2012 with its first pilot project and is currently in operation in nine 
member States.6 The SW initially inco rporated the certificates for the Common Veterinary Entry 
Document  and Common Entry Document . Last year, it incorporated new certificates i.e. the Forest 
Law Enforcement, Governance and Trade (FLEGT)  licence , the Certificate of Organic Inspection 
(COI) , the Common Health Entry Document for Plant Protection (CHED -PP). Other certificates are 
under integration (i.e.  Ozone -Depleting Substances (ODS) , Fluorinated Greenhouse Gases ( f-gases ) 
and Dual -Use Export Goods); implementation is targeted for early 2021.7  
3.5.  Another initiative launched during the review period was the 2018 -22 EU Customs Action Plan 
to combat intellectual property rights (IPR) infringements.8 The Commission reports that over 
EUR 738 million in fake or counterfeit goods was confiscated by custom s in 2018, with China; 
                                                
1 European Commission, 50 years of the EU Customs Union . Viewe d at: 
https://ec.europa.eu/taxation_customs/50 -years -eu-customs -union_en .  
2 Customs Union Performance Annual Report 2018, based on provisional data provided by member 
State s on 8 May 2019.  
3 Count based on the Customs Control Equipment Instrument (CCEI) Needs Assessment.  
4 Customs Union Performance Annual Report 2018, based on provisional data provided by member 
States on 8 May 2019.  
5 European Commission, 2018 – Annual Activity Report . Viewed at: 
https://ec.europa.eu/info/sites/info/files/taxud_aar_2018_final.pdf .  
6 Bulgaria, Czech Republic, Cyprus, Estonia, Ireland, Latvia, Poland, Portugal, and Slovenia.  
7 European Commission, The EU Single Window environment for customs . Viewed at: 
https://ec.europa.eu/taxation_customs/general -information -customs/electronic -customs/eu -single -window -
environment -for-customs_en .  
8 EUR-Lex, Council Conclusions on the EU Customs Action Plan to combat IPR infringements for the 
years 2018 to 2022 . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52019XG0121(01)&rid=9 .  WT/TPR/S/395 • European Union  
 
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  Hong Kong, China; and Turkey as the main sources. Over 69,000 detentions were made concerning 
about 26.7 million articles, with the highest concentration in cigarettes, toys, and packaging 
materials.9 The EU Customs Action Plan to combat IPR infringements contain s four main strategic 
objectives , with a number of specific objectives for, and actions to be taken under, each one. For 
example, there are specific objectives on e ngaging right -holders and stakeholders , developing 
tailor-made approaches for parcel and postal traffic , and s trengthening customs risk management .10 
3.6.  In 2018, the EU collected about EUR 25.4 billion in customs duties on imports.11 Due to the 
sharing arrangement in place, about  EUR 20 billion was transferred to the EU  budget and 
EUR 5 billion (i.e. 20% administrative collection fee) was retained by the member States. Customs 
revenue contributed to 12.75%  of the EU budget  in 2018.12  
3.1.1.1   Legal framework and electronic systems  
3.7.  As enumerated in the previous Review, there were significant ongoing changes in the area of 
customs in recent years, with the implementation of the EU's new UCC and its accompanying 
legislation (hereinafter, UCC refers to the UCC and its related Acts) (Box 3.1)13, whose main 
substantive provisions entered  into force on 1 May 2016. The UCC is at the core of the EU's customs 
law, as it provides a comprehensive framework for customs rules and procedures. It mandates that 
all customs communications must be electronic. For that purpose,  various electronic syste ms are to 
be deployed pursuant to the UCC  Work Programme.14 In the meantime, certain transitional 
arrangements are in place. Pursuant to a recent modification of the UCC, the transition period was 
extended and so, the UCC electronic systems can now be gradu ally deployed until the end of 2025 . 
3.8.  The Work Programme will be reviewed to reflect these changes in the UCC15 and the information 
technology ( IT) planning ( Table 3.1) . Work will continue after 2020 on the national electronic 
systems concerned with notifications of arrival and presentation, declarations of temporary storage , 
and customs declarations ; on existing electronic systems that must be upgraded to take account of 
certain requirements, such as the  harmoni zation of data ; and three new trans -European electronic 
systems concerning guarantees for potential or existing customs debts, the customs status of goods, 
and centrali zed clearance . 
3.9.  The EU's planned implementation of new electronic systems, while delayed for some systems, 
is still going ahead or has been implemented in a number of areas. The systems which have already 
been implemented to date are as follows: Registered Exporters System, Binding Tariff Information 
Phase 1, Customs Decisions System, Uniform User Management and Digital Signature, Authorised 
Economic Operator upgrade Phase 1, Economic Operator Registration and Identification System 
upgrade , and Surveillance 3.  More specifically, the Customs Decisions System  (CDS) and the Uniform 
User Ma nagement and Digital Signature (UUM&DS)  started their activities in October 2017.  
3.10.   The Registered Export System (REX) was implemented on 1 January 2017 to facilitate the 
origin procedures under the GSP and recent EU FTAs.16 It allows registered exporters to self-certify 
                                                
9 European Commission, Taxation and Customs Union, Report on the EU cust oms enforcement of 
intellectual property rights: Results at the EU border, 2018 . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/2019 -ipr-report.pdf . 
10 EUR-Lex, Council Conclusions on the EU Customs Action Plan to combat IPR infringements for the 
years 2018 to 2022 . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52019XG0121(01)&rid=9 . 
11 European Commission, Customs duties mean revenue . Viewed at: 
https://ec.europa.eu/taxat ion_customs/facts -figures/customs -duties -mean -revenue_en ; DG BUDG, 
Surveillance; and information provided by the authorities.  
12 Information provided by the authorities.  
13 The UCC Delegated Act; the UCC Implementing Act; the UCC Transitional Delegated Act; and 
the UCC Work Programme; including their amendments, addenda, corrigenda, etc.  
14 See Table 3.2 in the previous Review (WTO document WT/TPR/S/357/Rev.1, 13 October 2017) and 
European Commission online information. Viewed at: https://ec.europa.eu/taxation_customs/business/union -
customs -code/ucc -work-programme_en#heading_2 .  
15 Regulation (EU) 2019/632. EUR-Lex, UCC – Work Programme . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=uriserv:OJ.L_.2019.111.01.0054.01.ENG&toc=OJ:L:2019:111:TOC . 
16 To date, the REX only applies to the FTAs with Canada and Japan.  WT/TPR/S/395 • European Union  
 
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  and make out a statement on origin.17 Another development was the implementation of the 
New Computerised Transit System (NCTS). This System was designed to increase efficiencies and 
accelerate transactions for goods under transit procedures. It  will be updated from Phase 4 to 
Phase  5, with  deployment foreseen during  2021–23. There will be new processes for "Incidents en 
route ", i.e.  if there is an incident during the transit operation, the economic operator must inform 
the nearest responsible cu stoms office , which will register the incident in the system (in the current 
phase , this task is done by either the customs office of destination or the customs office of transit). 
A new role Customs office of exit for transit " will be introduced . This office will act as the exit frontier 
customs office in case of pure transit (transit not following an export procedure) , and address  safety 
and security data and risk management. The declaration acceptance process will be extended , with 
the possibility of submit ting the declaration prior to the presentation of the goods. The data structure 
of the information exchange messages will be aligned with the EU Customs Data Model. Other minor 
adjustments will be made  to the existing processes.  
Box 3.1 UCC framework  
UCC Main law  Regulation (EU) No. 952/2013a 
UCC Delegated Act  Provides detailed rules concerning 
certain provisions of the UCC  Regulation (EU) No. 2015/2446b 
UCC Implementing Act  Lays down detailed rules for 
implementing certain provisions 
of the UCC  Regulation (EU) No. 2015/2447c 
UCC Transitional Delegated Act  Transitional rules for certain 
provisions of the UCC where the 
relevant electronic systems are 
not yet operational  Regulation  (EU) No. 2016/341d 
UCC Work Programme  Establish es the Work Programme 
relating to the development and 
deployment of the electronic 
systems  Commission Implementing 
Decision (EU) No. 2016/578e 
a Viewed at: http://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32013R0952&rid=1 . 
b Viewed at: http://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32015R2446&from=EN . 
c Viewed at: http://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32015R2447&from=EN . 
d Viewed at: https://eur -lex.europa.eu/legal -content/EN/ALL/ ?uri=CELEX%3A32016R0341 . 
e Viewed at: http://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32016D0578&from=EN . 
Source:  As noted in Box.  
Table 3.1 UCC new transitional measures for certain electronic systems, 2019  
Subject  UCC Article  New transition perioda 
For the exchange and storage of information, 
e.g. declarations, applications or decisions, between 
customs authorities and between economic operators 
and customs authorities  Article 6(1)  31 December 2020  
Provisions on the notification of arrival, on 
presentation and on declarations of temporary 
storage  Articles 133, 139, 145 
and 146  31 December  2022 
Provisions related to the customs declaration for 
goods brought into the customs territory  Articles 158, 162, 163, 
166, 167, 170 to 174, 
201, 240, 250, 254 
and 256  31 December 2022  
Provisions on guarantees for potential or existing 
customs debts  Point (b) of Article 
89(2) and Article 89(6)  31 December 2025  
Provisions on entry summary declarations and risk 
analysis  Articles 46, 47, 127, 
128 and 129  31 December 2025  
Provisions on the customs status of goods  Article 153(2)  31 December 2025  
Provisions on centrali zed clearance  Article 179  31 December 2025  
Provisions on transit  Point (a) of Article 210, 
Article s 215(2) , 226, 
227, 233 and 234  31 December 2025  
                                                
17 European Commission, REX – Registered Exporter system . Viewed at: 
https://ec.europa.eu/taxation_customs/ business/calculation -customs -duties/rules -origin/general -aspects -
preferential -origin/arrangements -list/generalised -system -preferences/the_register_exporter_system_en .  WT/TPR/S/395 • European Union  
 
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  Subject  UCC Article  New transition perioda 
Provisions on outward processing, pre -departure 
declarations, formalities on exit of goods, export of 
EU goods, re -export of non -EU goods , and exit 
summary declarations  Articles 258, 259, 263, 
267, 269, 270, 271, 
272, 274 and 275  31 December 2025  
a At the  latest.  
Source:  Regulation (EU) No.  2019/632 of the European Parliament and of the Council of 17 April 2019 
amending Regulation (EU) No . 952/2013 to prolong the transitional use of means other than the 
electronic data -processing techniques provided for in  the Union Customs Code. Viewed at:  
https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=uriserv:OJ.L_.2019.111.01.0054.01.ENG&to c=OJ:L:2019:111:TOC .  
3.11.   One of the recent developments was an amendment to the UCC Delegated Regulation in 2019 
to introduce a new form of import declaration with a "reduced data set" for goods  below the customs 
dutiable threshold (low -value consignments).18 The introduction of the new form of declaration 
responds to the need to lodge a customs declaration for every low -value consignment from 
1 January  2021 (when the VAT exemption for goods not exceeding EUR 10 or EUR 22 will disappear). 
It was recognized that  the full dataset in Annex B of the Delegated Regulation was not appropriate 
for the customs clearance of the low -value goods, due to the large increase in volume of low -value 
consignments now imported into the EU .19 Also, it did not meet the requirements f or levying VAT on 
these shipments. N either declarants nor customs IT systems can handle the production and 
processing of a standard customs declaration per consignment.  Therefore, amendments were made 
to have a simpler declaration for these goods, as outli ned in the Annex. These changes are scheduled 
to enter into force on 1 January 2021 to coincide with the changes to VAT.  
3.12.   The UCC was also amended in March 2019 to take into account a number of changes or 
corrections.20 The most relevant are the inclusion o f certain pre-arrival data  in an entry summary 
declaration , relief from import duty in certain cases where goods have been repaired or altered for 
outward processing, a clarification to certain rules on binding tariff rules (see Section 3.1.1.2), and 
the inclusion of the Italian municipality of Campione d'Italia  into the customs territory of the EU.  
3.13.   The UCC Delegated Act, which provides more detailed rules to provisions in the UCC, was also 
amended during the review period. In May 2018, a number of provisio ns were changed or clarified, 
such as the definition of exporter and registered exporter (Section 3.2.1), goods transhipped through 
a territory outside the Customs Union, certain rules on cumulation for rules of origin.21 Other 
developments concern two amen dments to the UCC Implementing Act, in 2017 and 2018, 
respectively.22 These were mainly to correct certain errors and omissions, and to facilitate the 
establishment of certain preferential rules of origin, in particular with respect to the GSP. A further 
                                                
18 Commission Delegated Regulation (EU) 2019/1143 of 14 March 2019 amending Delegated Reg ulation 
(EU) 2015/2446 as regards the declaration of certain low -value consignments. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=uriserv:OJ.L_.2019.181.01.0002.01.ENG&toc=OJ:L:2019:181:TOC .  
19 In the European Commission  study of 2015, Assessment of the application and impact of the VAT 
exemption for importation of small consignments , it was estimated that small v alue consignments, i.e. parcels 
below the EUR 10 to EUR 22 threshold, represent about 70% of all parcels. European Commission online 
information. Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/resources/documents/common/publications/studies
/lvcr-study.pdf . 
20 Regulation (EU) 2019/474 of the European Parliament and of the Council of 19 March 2019 amen ding 
Regulation (EU) No. 952/2013 laying down the Union Customs Code. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?qid=1562827757662&uri=CE LEX:32019R0474 .  
21 Commission Delegated Regulation (EU) 2018/1063 of 16 May 2018 amending and correcting 
Delegated Regulation (EU) 2015/2446 supplementing Regulation (EU) No. 952/2013 of the European 
Parliament and of the Council as regards detailed rules concerning certain provisions of the Union Customs 
Code. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562827757662&uri=CELEX:32018R106 3.  
22 Commission Implementing Regulation (EU) 2017/989 of 8 June 2017 correcting and amending 
Implementing Regulation (EU) 2015/2447 laying down detailed rules for implementing certain provisions of 
Regulation (EU) No. 952/2013 of the European Parliament a nd of the Council laying down the Union Customs 
Code Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1538035166624&uri=CELEX:32017R0989 ; and Commission Implementing Regulation 
(EU) 2018/604 of 18 April 2018 amending Implementing Regulation (EU) 2015/2447 as regards the procedural 
rules to facilitate the establishment in the Union of the preferential origin of goods, and repealing Regulations  
(EEC) No. 3510/80 and (EC) No. 209/2005. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1538035166624&uri=CELEX:32018R0604 .  WT/TPR/S/395 • European Union  
 
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  amendment occurred in September 2019 making a number of changes, in particular on surveillance 
of data elements and rules on exit.23 
3.1.1.2   Trade facilitation  
3.14.   Binding rulings for tariffs (BTI) and binding origin information (BOI) continue to be part of the 
EU's cust oms regime. As noted in the previous Review, there were some changes to the validity 
period and to their application on the trader, i.e. making them binding, as a result of the UCC's entry 
into force. Since that time, there were no further legal amendments . In 2018, as part of DG  TAXUD's 
efforts to provide certain legal clarifications, Administrative Guidance for BTI was developed and 
published; similar guidance for BOI was also made available in 2017.24 The use of BTI gradually 
increased each year, and over  244,000 valid BTIs were in force as at mid -2019. The use of BOI 
remained relatively stable and , at the end of 2018 , there were 4 ,775 valid BOIs . From October 2019 , 
all BTI  applications will be done electronically ; currently , most of them  are submitted  in paper  form 
only. For BOI, there is no electronic s ystem and these are treated in paper form.  
3.15.   One new development was the EU's initiative to expand advance rulings to customs valuation, 
in addition to tariffs and origin. In March 2018, the Comm ission launched exploratory consultations 
to gauge the need or desire for a legal basis for decisions on Binding Value Information  (BVI), 
pursuant to the UCC.25 About 200 responses were received during the public comment period, and 
86.5% of the respondents  were in favour of establishing BVI decisions.26 Based on the results of the 
public consultation, a Customs 2020 Project Group involving ten member States was set  up, with 
the aim of drafting a feasibility study addressing the possible implementation of a n EU BVI system. 
It is planned to complete the feasibility study by early 2020.  
3.16.   Under the EU Authorised Economic Operator (AEO) programme, trusted traders, who 
voluntarily meet a wide range of criteria, work in close cooperation with customs authorities to 
assure the common objective of supply chain security. This entitles AEOs to benefit throughout the 
EU. As described in the previous Review, there are two types of authorizations: AEOs for customs 
simplification programmes (AEOC) and for secu rity (AEOS).  It is possible to combine AEOC and AEOS 
status. From 1 October 2019, an EU harmonized trader interface, the eAEO, will be operational. It 
will allow electronic exchange of information, i.e. notifications between Customs and AEOs regarding 
the AEO processes relating to the application and management of authorization. The system is 
expected to be fully operational on 15 December 2019.  
3.17.   Another trade -facilitating measure is the Smart and Secure Trade Lanes (SSTL)  Pilot Project 
that was initiated in  2006 as a pilot to test end-to-end supply chain security instruments  between 
the EU and China. The Project operates about  120 trade lanes involving 200 economic operators 
between 16 maritime ports  in certain EU member States and China. The Project has now  entered 
into a third phase, whereby traders will have faster  customs clearance with enhanced logistical 
processes . This is expected to result in a higher share of goods traded under the SSTL, thereby 
improving supply chain security and trade facilitation.27 The Project is expanding to other modes of 
transportation, in particular air and rail, and to involve more partner countries.  
                                                
23 Commissio n Implementing Regulation (EU) 2019/1394 of 10 September 2019 amending and 
correcting Implementing Regulation (EU) 2015/2447 as regards certain rules on surveillance for release for 
free circulation and exit from the customs territory of the Union. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=uriserv:OJ.L_.2019.234.01.0001.01.ENG&toc=OJ:L:2019:234:TOC .  
24 European Commission, Administrative Guidance on the Binging Tariff Information Process . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/bt i_guidance_en.pdf ; and Guidance on Binding 
Origin Information. Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/guidance_boi_en.pdf .  
25 European Commission, Exploratory Public consultation on the establishment in the EU of Decisions 
relating to binding information in the field of customs valuation . Viewed at: 
https://ec.europa.eu/info/consultations/exploratory -public -consultation -establishment -eu-decisions -relating -
binding -information -field-customs -valuation_en .  
26 CIRCABC, Statistics: Exploratory Public consultation on the establishment in the EU of Decisions 
relating to binding information in the field of customs valuation . Viewed at: 
https://circabc.europa.eu/sd/a/d447b5cb -421d-4df8-95a5-
bb75fb6f72f6/Statistics%20report%20Customs%20valuation%20consultation.pdf . 
27 European Commission, Smart and Secure Trade Lanes Pilot (SSTL) . Viewed at: 
https://ec.europa.eu/taxation_customs/general -information -customs/customs -security/smart -secure -trade -
lanes-pilot-sstl_en . WT/TPR/S/395 • European Union  
 
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  3.18.   The Commission continues to streamline and improve  procedures in ports  and maritime 
transport. On 15 August 2019, Regulation 2019/1239, establishing a European Maritime Single 
Window environment  (EMSWe) , entered into force.  This was in response to the need to reduce the 
administrative burden for shipping companies, expedite maritime transport, and improve the 
interope rability of information flows. Thus, the new Regulation, replacing the previous one from 
2010, further harmonizes rules for submitting information when ships arrive at or depart from 
EU ports. It  will be fully applied f rom 2025 and is expected to halve the  time currently required for 
administrative formalities  for port calls.28 
3.1.1.3   Customs valuation  
3.19.   The UCC's changes to the customs valuation framework were rather extensive in terms of 
structure and substance, as outlined in the previous Review.29 There were no ma jor changes in the 
legal structure since the UCC provisions become applicable on 1 May 2016 .  
3.20.   In 2018, the Commission issued a new version of the Customs Valuation Compendium, to 
take into account the changes introduced by the UCC.30 This, and the associate d Guidance document, 
provide further clarification on the application of the transaction value method (Article 128 UCC IA) 
and the treatment of royalties for valuation purposes (Article 136 UCC IA). The Compendium and 
Guidance are meant to serve as a guide  for customs administrations and traders; i.e. they are of an 
explanatory nature and are not legally binding. Section B of the Compendium aligns the UCC 
provisions with the respective interpretive notes of the WTO Agreement on Implementation of 
Article  VII of GATT 1994 (Customs Valuation Agreement).  Currently, works are underway to revise 
the Guidance document. It is intended that an updated version of the document will be made 
available in the first quarter of 2020.  
3.21.   Another development that may have an imp act on valuation results from a CJ EU court case 
in 2017. The case questions whether transfer prices can be used as the basis for the transaction 
value methodology of valuation. The CJ EU ruling states that the EU legal provisions on the 
determination of the  customs value "do not permit an agreed transaction value, composed of an 
amount initially invoiced and declared and a flat -rate adjustment made after the end of the 
accounting period, to form the basis for the customs value, without it being possible to k now at the 
end of the accounting period whether that adjustment would be made up or down".  
3.22.   The EU initiated consultations for advance binding rulings on valuation during the period 
(Section 3.1.1.2).  
3.23.   No notifications were made to the Committee on Customs Valuation during the review period; 
the modifications made to the EU's valuation rules pursuant to the UCC remain outstanding.  
3.1.2   Rules of origin  
3.24.   As with other aspects of customs, the implementation of the UCC brought about changes in 
the EU's rules of origin , both preferential and non -preferential, in recent years. In summary, the 
UCC brought about changes to the lists indicating substantial processing or working operations 
conferring origin; designation of minimal operations that cannot be used for the subst antial 
transformation test; and self -certification of registered exporters, a new system for preferential rules 
of origin.  
3.25.   Since the last Review, there have not been substantial changes in the EU's rules or origin . 
However, a number of new preferential ag reements entered into force or were provisionally applied, 
which have their own unique origin rules.  
                                                
28 Regulation of the European Parliament and of the Council establishing a European Maritime Single 
Window Environment and repealing Directive 2010/65/EU. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CONSIL:PE_38_2019_REV_1&qid=1562323418812&from=EN .  
29 WTO document WT/TPR/S/357,  17 May 2017, Section 3.1.2  
30 European Commission, Compendium of Customs Valuation Texts . Viewed at: 
https://ec.europa.eu/taxation_customs/s ites/taxation/files/customs_valuation_compendium_2018_en.pdf . It is 
noted that revisions included the removal of references to "domestic sales".  WT/TPR/S/395 • European Union  
 
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  3.1.2.1   Non-preferential  
3.26.   The basic rules on non -preferential origin, as outlined in the UCC, did not change since the 
last Review. The basic rules remain as follo ws: 
• goods wholly obtained in a single country or territory are regarded as having their origin 
in that country or territory; and  
• goods, the production of which involves more than one country or territory, shall be 
deemed to originate in the country or terr itory where they underwent their last, 
substantial, economically -justified processing or working, in an undertaking equipped for 
that purpose, resulting in the manufacture of a new product or representing an important 
stage of manufacture.  
3.27.   In order to dete rmine their substantial transformation if more than one country is involved, 
the EU refers to Annex 22 -01 of the UCC Delegated Act, which lists the specific rules for many 
products. For example, each item may have its own rule specified or it refers to a c hange in tariff 
heading, for example. Annex 22 -01 sets out specific rules for several products, at chapter, heading 
or subheading level, for 37 chapters.31 To determine the non -preferential origin of the products not 
explicitly mentioned in Annex 22 -01, the  general rule applies (wholly obtained or last substantial 
transformation).  
3.28.   In December 2018 , a "Guidance on non -preferential rules of origin ", referring to the relevant 
articles under the UCC , was published .32 
3.1.2.2   Preferential  
3.29.   Preferential rules of origin are determined by the underlying preferential agreement. The legal 
basis for the implementation of the preferential agreement is Article 64 of the UCC. Such preferential 
agreements can either be bilateral agreements (e.g. the CETA between the EU and Canada) or  a 
regional convention which harmonizes rules and promotes cumulation among the parties (e.g. the 
Regional Convention on pan -Euro-Mediterranean preferential rules of origin (PEM Convention)).33 
The majority of the EU's FTA partners are part of the PEM  Conve ntion; furthermore, the EU replaced 
the bilateral protocols of the preferential agreements with the PEM Members with a single legal 
instrument using the PEM Convention.34 
3.30.   Two recent agreements, with Canada and Japan, continue an earlier practice in a few FT As 
for origin determination with the establishment of origin quotas. For goods that ordinarily would not 
qualify through the product -specific rules, another alternative was given for a limited number of 
products and quantities. For example, the CETA provid es for some origin quotas for 
high-sugar -containing products , sugar confection ary and chocolate preparations , processed foods , 
dog and cat food , fish and seafood , textiles , apparel , and vehicles , as listed by HS code and quota 
amount in Annex 5 -A to the Protocol on Rules of Origin of the CETA.35 
3.31.   Other new FTAs entering into force in last few years, i.e. Japan, Côte d'Ivoire, Ghana, and the 
SADC, have rules of origin included in the respective EPAs or in the Market Access Regulation . An 
important feature of  EU rules of origin is cumulation (Table 3.2).  
                                                
31 Only textile chapters provide comprehensive coverage of all tariff lines; other chapters provide partial 
coverage. 
32 European Commission, Guidance on Non -Preferential Rules of Origin . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/guidance -on-non-preferential -rules-of-
origin_en.pdf . 
33 European Commissi on, Regional Convention on pan -Euro-Mediterranean preferential rules of origin . 
Viewed at: http://eur -lex.europa.eu/legal -content/EN/TXT/?uri=OJ:L:2013:054:TOC .  
34 Europea n Commission, The pan -euro-Mediterranean cumulation and the PEM Convention . Viewed at: 
https://ec.europa.eu/taxation_customs/business/calculation -customs -duties/rules -origin/general -aspects -
preferential -origin/arrangements -list/paneuromediterranean -cumulation -pem-convention_en .  
35 European Commission, Origin Quotas and Alternatives to the Product -Specific Rules of Origin in 
Annex  5. Viewed at: http://data.consilium.europa.eu/doc/document/ST -10973 -2016-ADD-
6/en/pdf#page=163 .  WT/TPR/S/395 • European Union  
 
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  3.32.   On 21 December 2016, the CJ EU ruled that the EU -Morocco Association Agreement did not 
apply to Western Sahara.36 As a result , the tariff preferences granted to products originating in 
Morocco could not be grant ed to products originating in Western Sahara. On 28 January 2019, the 
Council of the EU adopted a Decision on the conclusion of an agreement amending protocols of the 
EU-Morocco Association Agreement.37 This Agreement responds to the requirements set out by  the 
CJEU for an agreement to apply to Western Sahara. It creates the legal basis for granting the tariff 
preferences provided for in the EU -Morocco Association Agreement to products from Western 
Sahara,  and followed a wide -ranging consultation of the peop le concerned after a prior analysis 
demonstrated the benefits of the agreement for the Western Saharan population. Following 
ratification by Morocco, the Agreement entered into force on 19 July 2019.  
3.33.   During the review period, the EU notified preferential rules of origin to the WTO Committee 
on Rules of Origin for the CETA and the EU –Japan EPA.38 Also, in June 2017, the EU notified the 
Committee of its preferential rules of origin for LDCs pursuant to Paragraph 4.3 of the 
2015 Ministerial Decision on prefere ntial rules of origin for LDCs (WT/L/917/Add.1).39 
Table 3.2 Overview of preferential rules of origin, 2019  
Partner  Convention or 
arrangement  Cumulation  Legal reference  
Africa, the Caribbean 
and the Pacific (ACP)   EC-ACP-OCT Bilateral, diagonal and 
full Regulation (EU)  
No. 2016/1076a 
Albania  PEM Convention  Bilateral and diagonal  OJ L 129, 27.5.2015, 
p. 50 
Algeria  PEM Convention  Bilateral, diagonal and 
full  OJ L 297 , 15.11.2007  
Andorra  Agricultural products 
outside the Customs 
Union Bilateral  OJ L 344, 30.12.2015, 
pp. 15-52 
Bosnia -Herzegovina  PEM Convention  Bilateral and diagonal  OJ L 22, 27.1.2017, 
pp. 82-85 
Canada  Trade Agreement   OJ L 11, 14.01.2017, 
pp. 465-566 
Central America 
(Costa  Rica, El Salvador, 
Guatemala, Honduras, 
Nicaragua, Panama)  Association Agreement  Bilateral and regional  OJ L 346, 15.12.2012, 
p. 3 
Ceuta and Melilla  Protocol  Bilateral cumulation with 
the EC and diagonal or 
full cumulation, as 
appropriate, with partner 
countries of the EC  OJ L 20, 20.01.2001, 
p. 1 
Chile Association Agreement  Bilateral  OJ L 352, 30.12.2002, 
p. 3 amended by OJ L 
38, 10.2.2005, p. 3  
Colombia  Trade Agreement  Bilateral and regional  OJ L 354, 21.12.2012, 
p. 3 
Ecuador  Trade Agreement  Bilateral and regional  OJ L 356, 24.12.2016, 
p. 3 
EEA PEM Convention  Bilateral, diagonal and 
full  OJ L 129, 19.5.2016, 
pp. 56–84 
Egypt  PEM Convention  Bilateral and diagonal  OJ L 334 , 22.12.2015 
Faroe Islands/Denmark  PEM Convention  Bilateral and diagonal  OJ L 134, 30.5.2015, 
p. 29 
Georgia  PEM Convention  Bilateral  OJ L 140, 6.6.2018, 
pp. 107-109 
                                                
36 Judgment of the Court of Justice of 21 December 2016, Council of the European Union v Polisario 
Front, C-104/16 P, ECLI:EU:C:2016:973.  
37 EUR-Lex, Council Decision (EU) 2019/217 of 28 January 2019 on the conclusion of the agreement in 
the form of an Exchange of Letters between the European Union and the Kingdom of Morocco on the 
amendment of Protocols 1 and 4 to the Euro -Mediterranean Agreement establishing an association between the 
European Communities and their Member St ates, of the one part, and the Kingdom of Morocco, of the other 
part. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT /?uri=uriserv:OJ.L_.2019.034.01.0001.01.ENG&toc=OJ:L:2019:034:FULL .  
38 WTO documents G/RO/N/169, 24 May 2018; and G/RO/N/184, 15 April 2019.  
39 WTO document G/RO/LDC/N/EU/1, 30 June 2017.  WT/TPR/S/395 • European Union  
 
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  Partner  Convention or 
arrangement  Cumulation  Legal reference  
Iceland  PEM Convention  Bilateral and diagonal  OJ L 72, 17.3.2016, 
pp. 66-68 
Israel  PEM Convention  Bilateral and diagonal  OJ L 20 , 24.1.2006  
Japan  Trade Agreement  Bilateral, diagonal and 
full OJ L 330, 27.12.2019 , 
pp. 21 -32, and 634 -687 
Jordan  PEM Convention  Bilateral and diagonal  OJ L 209 , 31.7.2006  
Korea, Republic of  Trade Agreement  Bilateral  OJ L 127, 14.5.2011, 
p. 1344 
Lebanon  PEM Convention  Bilateral  OJ L 143 , 30.05.2006, 
p. 73 
Mexico  Partnership Agreement  Bilateral  OJ L 157, 30.06.2000, 
p. 10; and OJ L 245, 
29.09.2000, p.  1 
Republic of Moldova  PEM Convention  Bilateral  and diagonal  OJ L 39, 16.2.2017, 
pp. 45-48 
Montenegro  PEM Convention  Bilateral and diagonal  OJ L 28, 4.2.2015, p.  45 
Morocco  PEM Convention  Bilateral, diagonal and 
full  OJ L 336 , 21.12.2005 
last amended by OJ L 
141/66 , 27.5.2011  
North Macedonia, 
Republic of  PEM Convention  Bilateral and diagonal  OJ L 293, 28.10.2016, 
pp. 58-64 
Norway  PEM Convention  Bilateral and diagonal  OJ L 72, 17.3.2016, 
pp. 63-65 
Overseas Countries and 
Territories (OCT)  Council Decision No. 
2013/755/EU  of 25 
November 2013  EC-OCT-EPA bilateral 
and full cumulation, 
cumulation with GSP 
countries, extended 
cumulation  OJ L 344, 19.12.2013, 
pp. 38-114 
Palestinian Authority of 
the West Bank and the 
Gaza Strip  PEM Convention  Bilateral and diagonal  OJ L 05 , 30.7.2016 , 
pp. 24–26 
Peru Trade Agreement  Bilateral and regional  OJ L 354, 21.12.2012, 
p. 3 
Serbia  PEM Convention  Bilateral and diagonal  OJ L 367, 23.12.2014, 
p. 119 
Switzerland  PEM Convention  Bilateral and diagonal  OJ L 23, 29.1.2016, 
pp. 79–81 
Syria PEM Convention  Bilateral  OJ L 269 , 27.09.1978  
Tunisia  PEM Convention  Bilateral, diagonal and 
full  OJ L 260 , 21.9.2006  
Turkey  PEM Convention  Bilateral and diagonal  OJ L 265 , 26.9.2006 , 
p. 18, as last amended 
by OJ L 267 , 27.9.2006 , 
p. 48; OJ L43, 
06.06.2009, and 
Decision No . 3/2006 of 
the EC -Turkey 
Association Council  
Ukraine  PEM Convention  Bilateral  and diagonal  OJ L 161, 29.5.2014, 
p. 3 
a Rules of origin  are included in the EPAs, Market Access Regulation s, and the GSP. 
Source:  European Commission, Arrangements list . Viewed at: 
https://ec.europa.eu/taxation_customs/business/calculation -customs -duties/rules -origin/general -
aspects -preferentia l-origin/arrangements -list_en#eastern . 
3.1.3   Tariffs  
3.34.   Since the formation of the single market, the EU established the Common Customs Tariff 
(CCT) for the import of goods from external markets. In its most basic form, it provided the 
nomenclature for the classification of goods and the rates of duty . Council Regulation (EEC) 
No. 2658/87 of 23 July 1987  created the Combined Nomenclature (CN) as a further tool to integrate 
nomenclature, duties, the WCO's Harmonised System (HS), and statistical information. Since its 
establishment, the CN is updated regularly to take into account changes in nomenclature, duty rates, 
or other statistical information. During the review period, it  was updated twice, with the most recent WT/TPR/S/395 • European Union  
 
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  amendment in October 2018; the next update is planned for October 2019.40 The EU also maintains 
the integrated Tariff of the European Union (TARIC) , which is a database tool incorporating tariffs, 
statistical nomencl atures, agricultural measures, trade defence instruments, prohibitions, 
restrictions, etc.41  
3.1.3.1   Nomenclature and bound rates  
3.35.   During the review period, the EU continually updated the tariff nomenclature of the CN, for 
statistical reasons and to implement the WCO's HS 2017 changes. As a result, the number of tariff 
lines gradually increased over the period. In 2017, there were over 1,260  nomenclature changes, 
mainly on meat, chemicals, fish, and machinery, reflecting the WCO HS changes, compared w ith 
about 27 in 2018, mainly on agriculture, chemicals, and transport products, and 14 in 2019, mainly 
on fish, and chemicals.42  
3.36.   There have not been many developments with the EU's bound commitments in its WTO tariff 
schedule since the last Review. The las t certified schedule, Schedule CLXXIII , was approved in 2016, 
updating the tariff nomenclature to HS2002; thus, the three subsequent HS changes from 2007, 
2012, and 2017 remain pending certification .43 The EU is covered by the respective WTO HS waivers 
for the introduction of these changes.44 A few other issues to the schedule remain pending.45, 
3.37.   Furthermore, the United Kingdom took steps to establish its schedule, as a consequence of 
its expected  withdrawal from the EU . It submitted a draft schedule, indicatin g that the effective date 
is pending further notification, and notes that, in the meantime, it will continue to be covered by 
Schedule CLXXV -European Union.46 This draft received objections from other WTO  Members; thus, 
it is not approved.47 The United Kingd om also initiated Article XXVIII negotiations with respect to 
TRQs on agricultural and non -agricultural goods.48 
3.1.3.2   Applied rates  
3.38.   There were no significant changes in the EU's applied tariff structure since the last Review, 
and the rates remain nearly identica l (Table 3.3). For example, the simple average tariff remains at 
6.3% overall, and most others only deviate slightly due to statistical discrepancies.49 The only 
notable change was the slight increase in the number of duty -free tariff lines. This can be att ributed 
to the ongoing staged reductions in tariffs pursuant to the ITA II implementation.50 Thus, the number 
of nuisance tariffs declined slightly as a result of these changes. MFN applied rates are generally 
                                                
40 Commission Implementing Regulation (EU) No. 2017/1925 of 12 October  2017 amending Annex I to 
Council Regulation (EEC) No. 2658/87 on the tariff and statistical nomenclature and on the Common Customs 
Tariff. Viewed at: https://eur -lex.eu ropa.eu/legal -content/EN/TXT/?uri=CELEX%3A32017R1925 ; and 
Commission Implementing Regulation (EU) 2018/1602 of 11 October 2018 amending Annex I to Council 
Regulation (EEC) No. 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tar iff. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32018R1602#ntr1 -
L_2018273EN.01000101 -E0001 .  
41 European Commission, TARIC . Viewed at: 
https://ec.europa.eu/taxation_customs/business/calculation -customs -duties/what -is-common -customs -
tariff/taric_en .  
42 CIRCABC, TARIC and Quota data and information . Viewed at: 
https://circabc.europa.eu/ui/group/0e5f18c2 -4b2f-42e9-aed4-dfe50ae1263b/library/90dd4b94 -39dd-45f4-
8f33-ec9ef9820016 . 
43 WTO document WT/Let/1220, 14 December 2016.  
44 WTO documents WT/L/1049; WT/L/1050; and WT/L/1051, 13 December 2018.  
45 For example, as a consequence to the expected withdrawal of the United Kingdom from the EU, 
Article XXVIII negotiations were initiated by the EU.  
46 WTO document G/MA/TAR/RS/570, 24 July 2018.  
47 Status as at May 2019. WTO document G/MA/W/123/Rev.5, 20 May 2019.  
48 WTO document G/SECRET/44, 21 December 2018.  
49 As the number of tariff lines has increased, this has an impact on the calculations.  
50 Council Decision (EU) 2016/971 of 17 June 2016 on the conclusion, on behalf of the European Union, 
of an agreement in the form of the Declaration on the Expansion of Trade in Information Technology Products 
(ITA). Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32016D 0971; and Council 
Decision 2011/194/EU of 7  March 2011 on the conclusion of a Geneva Agreement on Trade in Bananas 
between the European Union and Brazil, Colombia, Costa Rica, Ecuador, Guatemala, Honduras, Mexico, 
Nicaragua, Panama, Peru and Venezuela and of an Agreement on Trade in Bananas between the 
European  Union and the United States of America. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A3 2011D0194 .  WT/TPR/S/395 • European Union  
 
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  identical, or close, to the WTO bound rates; th us, the EU does not have any significant binding 
overhang.  
Table 3.3 Structure of MFN tariffs, 2019  
(%) 
 MFN applied  Final bound  
2019a 2016a 2019b 
1. Bound tariff lines (% of all tariff lines)  100.0  100.0  100.0  
2. Simple average tariff rate  6.3 6.3 6.4  
Agricultural products (WTO definition)  14.1 14.2 14.4  
Non-agricultural products (WTO definition)  4.3 4.2 4.3  
Agriculture, hunting, forestry and fishing (ISIC 1)  7.8 7.7 8.6  
Mining and quarrying (ISIC 2)  0.2 0.2 0.3  
Manufacturing (ISIC 3)  6.3 6.2 6.3 
3. Duty-free tariff lines (% of all tariff lines)  26.1 27.0 25.9 
4. Simple average rate of dutiable lines only  8.6 8.7 8.7 
5. WTO tariff quotas (% of all tariff lines)c 4.7 4.5 4.5 
6. Non-ad valorem  tariffs (% of all tariff lines)  10.6 10.7 10.8 
7. Non-ad valorem  tariffs with no AVEs (% of all tariff lines)  3.0 3.1 3.1 
8. Domestic tariff peaks (% of all tariff lines)d 5.7 5.5 5.7 
9. International tariff peaks (% of all tariff lines)e 8.5 8.5 8.8 
10. Overall standard deviation of applied rates  12.1 10.0 10.1 
11. Nuisance applied rates (% of all tariff lines)f 7.7 6.8 7.0      
Number of lines  9,414  9,533  9,533   
Ad valorem  8,416  8,512  8,502   
 Duty-free lines  2,461  2,572  2,470   
Non-ad valorem   998 1,021  1,031   
 Specific  652 674 684  
 Compound  199 199 201  
 Mixed  64 64 62  
 Otherg 83 84 84 
a Ad valorem equivalents (AVEs)  were estimated based on 2015 import data at the 8 -digit tariff from 
the Eurostat database. In case of unavailability, the ad valorem  part was used for compound and 
mixed rates. Duty rates under the ITA Expansion (as at 1 July 2016) were taken into account in 
calculations.  
b AVEs were estimated based on 2018 import data at the 8 -digit tariff from the Eurostat database. In 
case of unavailability, the ad valorem  part was used for compound and mixed rates. Duty rates 
under the ITA Expansion (as at 1 July 2017) were taken into account in calculations.  
c Information based on the Official Journals of the European Union, L 285 (30 October 2015) and 
L 273 (31  October 2018).  
d Domestic tariff peaks are defined as those exceeding three times the overall simple average applied 
rate. 
e International tariff peaks are defined as those exceeding 15%.  
f Nuisance rates are those greater than zero, but less than or equal to 2%.  
g Other includes Agricultural Components (EA), Additional Duties for Sugar (AD S/Z), Additional Dutie s 
for Flour (AD F/M), and Entry Prices (EP).  
Note:  All tariff calculations exclude in -quota lines. Year 2016 and 2019 tariff schedules are based on 
HS2012 and HS2017, respectively.  
Source:  WTO Secretariat calculations, based on the IDB database and the Eur ostat database.  
3.39.   As noted in previous reviews, the agricultural sector stands out in the tariff analysis, due to 
significantly higher rates, wide tariff range, use of non -ad valorem  rates, and use of tariff quotas. 
There were minor changes to the simple average tariffs in the agriculture sector and the tariff range, 
due mainly to statistical anomalies in calculating ad valorem  equivalents. While the highest tariff in 
the agriculture sector appears to have declined since the last Review, this was due to one outlying 
tariff with a high ad valorem  equivalent. Nevertheless, there is a much greater incidence of high 
tariffs in the agriculture sector compared to non -agricultural products. N early all tariffs above 20% 
are in the agriculture sector (Chart 3.1). The highest tariff rates in agriculture are concentrated in WT/TPR/S/395 • European Union  
 
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  the animal and animal products, dairy, and sugar and confectionary sectors. The dairy sector 
continues to be one with the hig hest levels of protection, with high tariffs that are all non -ad valorem  
duties and no duty -free lines (Table 3.4).  
Chart 3.1 Applied MFN tariff rate distribution for agricultural and non -agricultural 
products , 2019  
 
Note:  Calculations exclude in -quota rates an d include AVEs, as available. In cases where they were not 
available, the ad valorem  part was used for compound and mixed rates. Figures do not add to 100% 
due to certain AVEs not being available (approximately 2% of the total tariff lines).  
Source:  WTO Secretariat, based on the IDB and Eurostat databases.  
Table 3.4 Applied MFN tariff summary, 2019  
 Number 
of lines  Simple 
average 
(%) Tariff 
range  
(%) SDa Share 
of 
duty-
free 
lines  
(%) Share of 
non-ad 
valorem  
tariffs  
(%) 
Total  9,533  6.3 0-171.6  10.0 27.0 10.7 
HS 01 -24 2,505  14.1 0-171.6  16.7 14.9 38.4 
HS 25 -97 7,028  3.7 0-70 3.8 31.3 0.8 
By WTO category        
WTO agricultural products  2,099  14.2 0-171.6  18.3 18.9 47.0 
Animals and products thereof  351 19.0 0-116.6  21.0 15.1 68.7 
Dairy products  151 32.3 0.9-160.3  25.9 0.0 100.0  
Fruit, vegetables, and plants  509 13.0 0-162.9  13.5 11.8 17.1 
Coffee, tea, and cocoa and cocoa 
preparations  47 11.5 0-18.7 6.7 14.9 51.1 
Cereals and preparations  226 17.2 0-99.6 14.8 8.8 79.6 
Oil seeds, fats, oils and their 
products  175 6.3 0-94.3 10.6 35.4 7.4 
Sugars and confectionary  44 27.0 0-148.2  33.4 4.5 88.6 
Beverages, spirits and tobacco  331 12.9 0-118.5  18.3 16.6 58.6 
Cotton  6 0.0 0 0.0 100.0  0.0 
Other agricultural products, n.e.s.  259 5.9 0-171.6  14.7 51.0 22.0 
05001,0001,5002,0002,5003,000
Duty-free >0%-5% >5%-10% >10%-15% >15%-20% >20%-25% >25%-30% >35%Chart 3.[distribution] Applied MFN tariff rates distribution, 2019
Number of tariff lines
Agricultural products (WTO definition)
Non-agricultural products (WTO definition)
WTO Secretariat calculations based on IDB database and Eurostat database.Note:
Source:Calculations exclude in -quota rates and include AVEs, as available.  In case of unavailability, the ad valorem part is used for 
compound and mixed rates.  They do not add to 100% due to  unavailability of AVEs for some  tariff lines (representing 2.0% 
of total tariff lines).  WT/TPR/S/395 • European Union  
 
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   Number 
of lines  Simple 
average 
(%) Tariff 
range  
(%) SDa Share 
of 
duty-
free 
lines  
(%) Share of 
non-ad 
valorem  
tariffs  
(%) 
WTO non-agricultural products  7,434  4.2 0-26 4.4 29.3 0.5 
Fish and fishery products  525 11.8 0-26 6.1 7.4 0.0 
Minerals and metals  1,443  2.0 0-12 2.6 50.6 0.7 
Chemicals and photographic 
supplies  1,310  4.4 0-17.3 2.7 25.1 0.3 
Wood, pulp, paper and furniture  461 1.2 0-10.5 2.3 74.0 0.0 
Textiles  838 6.6 0-12 2.5 2.0 0.1 
Clothing  341 11.6 6.3-12 1.3 0.0 0.0 
Leather, rubber, footwear and 
travel goods  259 5.0 0-17 4.7 22.0 0.0 
Non-electric machinery  882 1.8 0-9.7 1.4 23.7 0.0 
Electric machinery  463 2.1 0-14 2.5 37.6 0.0 
Transport equipment  270 5.3 0-22 5.0 11.1 0.0 
Non-agricultural products, n.e.s.  594 2.0 0-9.5 1.9 38.7 3.4 
Petroleum  48 2.4 0-4.7 2.0 39.6 0.0 
By ISIC sectorb       
ISIC 1 - Agriculture, hunting and 
fishing  654 7.7 0-171.6  12.9 35.3 17.6 
ISIC 2 - Mining and quarrying  115 0.2 0-8 1.1 93.0 2.6 
ISIC 3 - Manufacturing  8,763  6.2 0-162.9  9.8 25.5 10.3 
By stage of processing        
First stage of processing  1,222  6.4 0-171.6  10.5 42.9 12.7 
Semi-processed products  2,819  5.0 0-162.9  7.8 31.3 3.8 
Fully processed products  5,492  6.9 0-160.3  10.8 21.2 13.8 
a Standard deviation.  
b International Standard Industrial Classification (Rev.2). Electricity, gas and water are excluded 
(1 tariff line). 
Note:  Calculations for averages are based on the national tariff line level (8 -digit), excluding in -quota 
rates. Tariff schedule was based on HS2017. AVEs were estimated based on 2018 import data at the 
8-digit tariff from the Eurostat database. In the case of unavailability, the ad valorem  part was used 
for compound and mixed rates.  
Source:  WTO Secretariat calculations, based on the IDB database and the Eurostat database.  
3.40.   The number of non -ad valorem  tariffs in the EU also stands out, as about 10% of tariff lines 
are non -ad valorem , and their number increased over the review period. Further, of the 
non-ad valorem  tariffs, about one third are compound, mixed, or other, meaning that it is often 
difficul t to determine the duty rate or calculate the real impact of the tariff.  
3.41.   For non -agricultural products, the fish and fishery products (11.8% simple average) and 
clothing (11.6%) sectors stand out as the ones with the highest tariff protection among an over all 
low average of 4.2% for non -agricultural products. The electric machinery sector had some declines 
in the overall average for the sector compared to the last Review, due mainly to the ITA II 
implementation. The sectors with the highest outlying tariffs , i.e. above 20% in non -agricultural 
products, are fish and transport equipment . 
3.1.3.3   TRQs and administration  
3.42.   The EU continues to have a number of tariff quotas as part of its trade regime , although it 
characteri zes these as an exception to the norm as they permit a limited quantity of goods to benefit 
from preferential tariff rates. There are three main categories of TRQs: (i) preferential, pursuant to 
FTAs or other agreements by the EU; (ii) autonomous, for duty suspensions (Section 3.1.3.4), WT/TPR/S/395 • European Union  
 
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  certain fish products, and other non -preferential access51; and (iii) conventional , which include the 
WTO TRQs.52 DG Agriculture and Rural Development (DG AGRI) manages the quotas for agricultural 
products based on licences , some of which are subject to allocation coefficients. These are  publishe d 
online .53 DG TAXUD manages the other quotas , including agricultural TRQs,  on a first -come -first-
served basis , and maintains a quota database for monitoring and determining fill rates.54  
3.43.   According to information contained in the TARIC, 712 preferential TRQs were in place pursuant 
to FTAs with 26 trading partners as at 1 January 2019.55 Most of these, about 78%, were with 
respect to agricultural products, and the vast majority provided acce ss with zero rates of duty. The 
other category, referred to as non -preferential TRQs, had 257 TRQs in place, including the WTO  TRQs 
and those providing autonomous access.56 Many of these provide autonomous access below MFN 
rates for fish and industrial prod ucts in particular.  
3.44.   There were several developments on tariff quotas during the review period. In January 2019, 
the EU issued a regulation on the apportionment of the WTO tariff quotas57 between the EU and the 
United Kingdom,  in anticipation of the latter' s eventual withdrawal from the EU.58 More specifically, 
the EU put in place a methodology for the apportionment of TRQs for Article XXVIII negotiations,  in 
order to ensure a smooth transition and a continuous process of importation under quotas. 
The regulation sets out that the TRQs will be apportioned between the EU -27 and the 
United  Kingdom,  based on their respective import share of the quota during a recent representative 
three -year period. The Annexes then establish the percentages and apportionme nt for each quota 
category. An implementing  regulation was issued in March 2019 that further clarifies and gives more 
precision to the earlier directive in the field of licences managed by DG AGRI.59 The regulations are 
currently in force but the articles i mplementing the apportionment have not been activated because 
they only become effective when Regulation (EC) No. 32/2000 ceases to apply to the 
United  Kingdom, meaning  that the regulation has built -in transition provisions that will apply for a 
period aft er which the treaties cease to apply between the EU and the United Kingdom.  
3.45.   The EU has 107 categories of TRQs in its WTO schedule, of which 79 (74%) concern 
agricultural products, and 28 (26%) are with respect to non -agricultural products (Table A3.1).60 
Agricultural TRQs cover a diverse group of products, including meat, fruit, grains, vegetables, 
cheese, wine, chocolates, etc., while non -agricultural TRQs are mainly on fish, certain metal 
products, certain wood products, flax yarn, and glass beads. For th e latest representative period, 
                                                
51 Council Regulation (EU) 2018/1977 of 11 December 2018 opening and providing for the management 
of autonomous Union tariff quotas for certain fishery products for the period 2019 –2020.  Viewed at: 
https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=uriserv:OJ.L_.2018.317.01.0002.01.ENG&toc=OJ:L:2018:317:TOC .  
52 The EU has TRQs in its WTO schedule on both agricultural an d non -agricultural goods; thus, the 
reference here is only to the agricultural TRQs.  
53 Commission Implementing Regulation (EU) 2015/2447 of 24 November 2015 laying down detailed 
rules for implementing certain provisions of Regulation (EU) No. 952/2013 of t he European Parliament and of 
the Council laying down the Union Customs Code. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32015R2447 ; European  Commission, Aim of tariff rate quotas . Viewed at: 
https://ec.europa.eu/agriculture/tariff -rate-quotas -trqs_en ; and European Commission, Tariff Rate Quotas . 
Viewed at: https://ec.europa.eu/info/food -farming -fisheries/key -policies/common -agricultural -policy/market -
measures/trqs .  
54 European Commissio n, Tariff Quota Consultation . Viewed at: 
https://ec.europa.eu/taxation_customs/dds2/taric/quota_consultation.jsp?Lang=en .  
55 CIRCABC, TARIC and Quota data and i nformation . Viewed at: 
https://circabc.europa.eu/ui/group/0e5f18c2 -4b2f-42e9-aed4-dfe50ae1263b/library/90dd4b94 -39dd-45f4-
8f33-ec9ef9820016 .  
56 It also includes special TRQs for certain handicraft products.  
57 Both agricultural and non -agricultural TRQs.  
58 Regulation (EU) 2019/216 of the European Parliament and of the Council of 30 January 2019 on the 
apportionment of tariff ra te quotas included in the WTO schedule of the Union following the withdrawal of the 
United Kingdom from the Union, and amending Council Regulation (EC) No. 32/2000. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?qid=1562700042527&uri=CELEX:32019R0216 .  
59 Commission Implementing Regulation (EU) 2019/386 of 11 March 2019 laying down rules with regard 
to the apportionment of tariff rate quotas for  certain agricultural products included in the WTO schedule of the 
Union following the withdrawal of the United Kingdom from the Union and with regard to import licences issued 
and import rights allocated under those tariff rate quotas. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562700042527&uri=CELEX:32019R0386 .  
60 WTO documents WT/Let/1220, 14 December 2016; G/AG/N/EU/48, 30 October 2018; and 
G/AG/N/EU/50, 22 February 2019; and information provided by the authorities.  WT/TPR/S/395 • European Union  
 
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  the use of TRQs varied significantly; some have 100% fill rates and others have 0% but with an 
overall average fill rate of 52%. A fairly significant number, 24%, were not utilized at all (zero fill 
rate), and about 30% were  fully utilized with 100% fill rates (Table  A3.1).  
3.1.3.4   Duty suspensions and special tariff treatment  
3.46.   The EU maintains legislation for the autonomous suspension of customs duties or autonomous 
tariff quotas for certain agricultural and industrial products  that are either not available or 
insufficiently produced  in the EU to meet the demand in the EU. The previous legislation from 2013 
was replaced by two new regulations in 2019.61 The new regulation on the suspension of tariff duties 
amends the products covered,  to add 97 new products, remove 26 products, and modify the 
conditions for 47 products. Moreover, with a view to promoting integrated battery production in the 
EU, and in accordance with the communication from the Commission entitled "Europe on the 
Move  — Sustainable Mobility for Europe: safe, connected, and clean ", the suspensions for 
20 additional products listed were wi thdrawn. Furthermore, another 50 suspensions were deleted as 
a result of the implementation of the agreement in the form of the Declarati on on the Expansion of 
Trade in Information Technology Products, which reduced the duty rate for the products concerned 
to zero. Thus, there are now autonomous duty suspensions on 2,277 tariff lines, and these products 
are mainly imported with zero duties,  although in some cases only lower duties apply. The majority 
of products are concentrated in the chemicals and machinery sectors.  
3.47.   A similar regulation on providing autonomous tariff quotas  was also put in place to ensure 
sufficient and uninterrupted supp ly, and t o avoid disturbances on the market  of certain products. 
The changes introduced six new tariff quotas and the increase in quota volume for four quotas. One 
tariff quota was terminated. Furthermore, four tariff quotas were closed as a result of the 
implementation of the agreement in the form of the Declaration on the Expansion of Trade in 
Information Technology Products . There are 120 tariff lines covered by these autonomous quotas in 
2019.  
3.48.   Another development was the replacement of another regulatio n on the temporary suspension 
of duties on the import of certain aircraft products. The previous regulation (EC No. 1147/2002) was 
replaced by Council Regulation (EU) 2018/581 , in order to take into account a number of technical 
and legislative development s.62 The Regulation provides for the temporary duty suspension of parts, 
components and other goods used for the manufacture, repair, maintenance, rebuilding, 
modification or conversion of aircraft  when imported with airworthiness certificates . The Regulation 
goes beyond the product coverage of the WTO Civil Aircraft Agreement, which is also applied by the 
EU. In order to benefit from the special treatment, the new Regulation requires an authori zed release 
certificate EASA Form 1  as part of the  importation process.  
3.49.   As highlighted in the previous Review, the EU maintains other special import tariff treatment 
on certain poultry meat, eggs, and egg albumin from certain countries; and on other products due 
to their nature, quality, or authenticity.63 There were no changes to these regimes.  
                                                
61 Council Regulation (EU) 2019/998 of 13 June 2019 amending Regulation (EU) No. 1388/2013 opening 
and providing for the management of autonomous tariff quotas of the Union for certain agricultural and 
industrial products. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019R0998&from=EN ; and Council Regulation (EU) No. 2019/999 of 
13 June 2019 amending Regulation (EU) No. 1387/2013 suspending the autonomous Common Customs Tariff 
duties on certain agricultural and industrial products. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019R0999&from=EN . 
62 Council Regulation (EU) 2018/581 of 16 April 2018 temporarily suspending the autonomous Common 
Customs Tariff duties on certain goods of a kind to be incorporated in or used for aircraft, and repealing 
Regulation (EC) No. 1147/2002. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=uriserv:OJ.L_.2018.098.01.0001.01.ENG&toc=OJ:L:2018:098:TOC .  
63 Commission Implementing Regulation (EU) 2016/1894 of 26 October 2016 amending Regulation (EC) 
No. 1484/95 as regards fixing representative price s in the poultrymeat and egg sectors and for egg albumin.  
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32016R1894 ; and Annex 9 of 
Commission Im plementing Regulation (EU) No. 2018/1602 of 11 October 2018 amending Annex I to Council 
Regulation (EEC) No. 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32018R1602 . WT/TPR/S/395 • European Union  
 
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  3.1.3.5   Preferential tariffs  
3.50.   The EU continues to have a number of preferential regimes, both reciprocal and unilateral, 
that offer preferential duties upon importation into the EU. Based on the 2019 preferential duty 
rates,  most partners or recipients receive significant duty -free access on a large percentage of their 
exports to the EU (Table 3.5). Similar to the situation with MFN tariffs, access was greater on 
non-agricultural goods compared to agricultural goods, with sev eral partners having 100% of 
non-agricultural goods covered at zero duties, and with the simple average duty rate of 
non-agricultural products below 1% in all regimes except GSP. The agricultural sector, on the other 
hand, had simple average tariffs of abo ve 10% for many partners. In general, the percentage of 
duty-free lines increased since the last Review, due to the staged implementation of some 
agreements and new improved agreements with certain partners, e.g. Iceland. At the same time, 
the simple avera ge tariff rate slightly decreased for many agreements for the same reasons.64  
Table 3.5 Tariffs under preferential agreements, 2019  
 
Simple average tariff rate 
(%) Duty -free lines as a 
percentage of total tar iff lines 
(includes MFN duty -free 
lines) (%)  
Overall  WTO 
agri. WTO 
non-
agri. Overall  WTO 
agri. WTO 
non-agri. 
MFN 6.3 14.2 4.2 27.0 18.9 29.3 
Albaniaa 0.3 1.1 0.1 97.1 91.2 98.8 
Algeria  2.4 12.0 0.0 84.3 29.3 99.9 
Andorra  0.1 0.3 0 98.8 94.5 100 
Bosnia and Herzegovinaa 0.3 1.1 0.1 97.2 91.3 98.8 
Canadab 0.4 1.4 0.1 96.2 88.0 98.5 
Central Americab 1.1 5.4 0.0 93.1 68.7 100.0  
Ceuta -Melilla  2.5 12.2 0.0 84.7 30.9 99.9 
Chile 1.8 8.8 0.0 89.9 54.8 99.7 
Colombiab 0.9 4.5 0.0 93.9 72.5 100.0  
Ecuadorb 1.0 4.8 0.0 93.6 71.8 99.8 
Egypt  0.2 0.7 0.0 98.9 95.9 99.8 
EPAb 0.0 0  0.0 99.8 100 99.8 
Faroe Islands  3.2 13.6 0.6 79.4 21.6 95.7 
Georgia  0.0 0.2 0 98.8 94.5 100 
Icelandc 1.1 4.5 0.3 90.0 73.6 94.6 
Israel  0.5 2.3 0.1 95.5 80.9 99.6 
Japanb 0.4 0.5 0.3 95.8 95.8 95.8 
Jordan  0.7 0.2 0.8 93.8 95.0 93.5 
Korea, Republic ofb 0.1 0.3 0.0 99.4 97.6 100.0  
Kosovoa, f 0.3 1.1 0.0 97.8 91.2 99.7 
Lebanon  0.3 1.2 0.0 97.2 87.3 100.0  
Liechtensteinc 2.5 10.9 0.3 81.7 37.8 94.1 
Mexico  1.7 8.3 0.0 90.5 57.7 99.8 
Moldovab 0.0 0.2 0 98.7 94.3 100 
Montenegroa 0.3 1.1 0.1 97.2 91.3 98.8 
Morocco  0.1 0.5 0 99.5 97.6 100 
North Macedonia, Republic ofa 0.3 1.1 0.0 97.7 91.2 99.5 
Norwayc 2.5 10.9 0.3 81.6 38.6 93.8 
Overseas Countries & Territories  0.1 0.6 0 98.7 93.9 100 
Palestine  0.0 0.1 0 98.8 94.5 100 
Perub 0.7 3.2 0.0 94.2 73.6 100.0  
San Marino  0.0 0.0 0.0 99.9 99.9 99.9 
Serbiaa 0.3 1.1 0.1 97.2 91.2 99.0 
South Africa  0.8 3.4 0.0 95.4 81.3 99.4 
Switzerland  2.7 10.2 0.8 81.8 39.4 93.8 
Syrian Arab Republic  3.3 13.2 0.8 78.1 24.0 93.4 
Tunisia  2.4 11.8 0.0 84.3 29.5 99.8 
Turkey  1.6 7.8 0.0 90.3 56.4 99.9 
Ukraineb 1.0 4.3 0.2 92.1 77.0 96.3 
GSP+  1.8 8.7 0.0 89.1 54.0 99.0 
                                                
64 In a number of cases, the table indicates slightly higher simple average tariff rates and a lower 
percentage of duty -free lines but this is attrib uted to statistical anomalies due to the greater number of tariff 
lines in the EU schedule in 2019.  WT/TPR/S/395 • European Union  
 
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Simple average tariff rate 
(%) Duty -free lines as a 
percentage of total tar iff lines 
(includes MFN duty -free 
lines) (%)  
Overall  WTO 
agri. WTO 
non-
agri. Overall  WTO 
agri. WTO 
non-agri. 
GSP 4.1 12.3 1.9 57.3 24.7 66.5 
 Indiad 4.7 12.3 2.7 48.4 24.7 55.1 
 Indonesiad 4.1 12.6 1.9 57.1 23.5 66.5 
 Kenyad 4.1 12.4 1.9 57.3 24.5 66.5 
LDCs (EBA)  0.0 0 0.0 99.8 100 99.8 
 Cambodia  and Myanmare 0.0 0.0 0.0 99.8 99.8 99.8 
a For Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia, the lowest 
rate contained in either the West Balkan FTA or bilateral agreement was used for the calculations.  
b The tariff phase -out period is not yet over.  
c For Iceland, Liechtenstein, and Norway , the lowest rate contained in eithe r the EEA or bilateral 
agreement was used for the calculations.  
d Sector graduations from the Standard GSP are taken into account.  
e Safeguard measures on rice ( Official Journal  of the European Union L 15, 16 January 2019).  
f References to Kosovo shall be understood to be in the context of Security Council Resolution 1244 
(1999) . 
Note:  All tariff calculations exclude in -quota lines. If no preferential rate was applied, the corresponding 
MFN rate was used for the calculations.  In the case of unavailability, the ad valorem  part was used 
for compound and mixed rates. 0.0 refers to >0 and <0.05; 100.0 refers to >99.55 and <100.  
Source:  WTO Secretariat calculations, based on the IDB database and the Eurostat database.  
3.51.   According to EU statistics, the share of impo rts under preferential tariff regimes in total 
EU imports  is relatively low, with unilateral preferential regimes accounting for 3.8% of total imports 
in 2018, and preferential FTAs accounting for 13%.65 Furthermore, according to a report by UNCTAD, 
the uti lization of EU  preferences by partners varies considerably, although overall it is quite high at 
90%. The total value of utilized preferences by partner countries was EUR 105 billion on average  
during 2009 -13.66 Preference utilization rates were particularl y high for Iceland, Egypt, and Morocco, 
and relatively low for Mexico and the Republic of Korea.67 The value of preferential duties saved was 
particularly high for Turkey and Switzerland.  
3.52.   For the unilateral preference categories, i.e. GSP+, GSP, and EBA, th ere were no significant 
changes during the review period, except that the list of countries and the list of graduated products 
changed for the period 2017 -19, and the safeguard measure invoked under the GSP for rice from 
Cambodia and Myanmar resulted in th e CCT being applied.  
3.1.4   Other charges affecting imports  
3.53.   Value -added tax (VAT) and excise duties continue to be the two main other charges or taxes 
levied on imports into the EU. Excise duties are charged on a core group of products, i.e.  mainly 
alcohol, tobac co, and energy products, while VAT is charged on most products and services, although 
lower rates are typically applied on foodstuffs. Excise duty revenues amounted to about 
EUR 45.3 billion in 2017, or about 0.3% of GDP, with Germany and the Netherlands a ccounting for 
the largest shares68; similar figures for VAT indicate revenues of EUR  1,085 billion, or 7.0% of GDP, 
with Germany, France, and the United Kingdom as the largest contributors.69  
                                                
65 In 2016, the figures were nearly identical, with 3.9% entering under unilateral preferences and 
12.5% under FTAs. Source: Eurostat.  
66 UNCTAD, The Use of t he EU's Free Trade Agreements - Exporter and Importer Utilization of 
Preferential Tariffs . Viewed at: https://unctad.org/en/PublicationsLibrary/EU_2017d1_en.pdf .  
67 UNCTAD, The Use of the EU's Free Trade Agreements - Exporter and Importer Utilization of 
Preferential Tariffs .  
68 Eurostat, Main National Accounts Tax Aggregates (gov_10a_taxag) . Viewed at: 
https://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=gov_10a_taxag&lang=en .  
69 Eurostat, Main National Accounts Tax Aggregates (gov_10a_taxag) . WT/TPR/S/395 • European Union  
 
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  3.54.   The EU VAT Directive of 2006, subsequently amended by other EU Directives, sets out basic 
rules for VAT, including rates.70 The VAT base is largely harmonized across the EU, but rates and 
procedures differ across member States. Concerning VAT, the standard rate is set at a minimum 
level of 15%, but there is no maximum;  and member States may have one or two reduced rates, 
with a minimum level of 5%. Thus, a range of VAT rates are applied, from 17% to 25% for the 
standard rate, and 5% to 18% for reduced rates (Section 3.3.1.3). There are also special rates, 
parking (i.e. grandfathered) rates, or exceptions to the basic rules for some countries. Exports from 
the EU are zero -rated for VAT, while imports are generally charged VAT, although there are some 
exceptions.71 
3.55.   During the review period, there were a number of legislativ e developments with respect to 
VAT, and the EU put forth many proposals to amend different VAT provisions.72 One of the more 
recent changes was described as four quick fixes, pending a more substantial overhaul of the 
VAT Directive.73 Scheduled to enter into force in 2020, these amendments allow for a simplified and 
uniform treatment for call -off stock arrangements ; require the VAT identification number of the 
customer to be communicated to the supplier in order for the supplier to app ly the VAT exemption 
for intra-EU supply of goods ; introduce rules to facilitate trader proof that the intra -EU transport 
(a condition for the exemption for intra -EU supplies of goods to apply) has taken place; and provide 
uniform criteria to assign the tr ansport to a concrete supply in the case of chain transactions 
involving a single intra -EU transport. Another set of rules, amending the main VAT Directive, are set 
to enter into force in 2021, and aim to simplify VAT for e -commerce transactions.74 This is expected 
to have an impact on trade and customs procedures, as the VAT exemption threshold of EUR 22  has 
been removed, and this will be accompanied by the need to submit a customs declaration for small 
shipments. The customs exemption of EUR 150 remains in  place. However, all commercial goods 
entering the EU will be subject to VAT from 1 January 2021, irrespective of their value. The legislation 
also introduces two alternative VAT collection mechanisms: (i) the Import One Stop Shop (IOSS), 
which relies on t raders collecting the VAT upon sale and periodical VAT payments to the tax 
authorities; and (ii) special arrangements for payment of VAT, which are based on current customs 
procedures , but allow the customs declarant, such as the post or courier operator, to pay the VAT 
monthly to the customs office. At the same time, to facilitate e -commerce, the threshold for customs 
duty relief will remain at EUR 150 and are subject to VAT. This has resulted in the necessity to 
change certain import procedures (Section 3 .1.1).  
3.56.   The IOSS is a voluntary VAT collection system for traders selling goods online to customers 
in the EU and will be operational from 1 January 2021. The system will require the setting up of a 
mechanism whereby customs authorities can automatically c heck the validity of each VAT IOSS 
identification number at the moment of importation. These numbers are granted by national tax 
authorities and the Commission will provide the network that allows these numbers to be 
communicated between EU m ember States. In this context , it is also looking into the possible use 
of blockchain for ensuring th e storage and transmission/availability of these IOSS VAT identification 
numbers.  
3.57.   The EU continues to harmonize three main categories of excise products — alcohol, energ y 
and electricity, and tobacco - which are subject to minimum rates of excise duty, in order to provide 
a more level playing field in  the internal market  (Table 3. 6). The general arrangements for the 
administration of the holding and the movement of excise  goods within the EU are set out in Council 
                                                
70 Council Direc tive No. 2006/112/EC of 28  November 2006 on the common system of value added tax. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/ALL/?uri=CELEX:32006L0112 .  
71 For example, personal and small imports, importation of goods in transit, reimportation after 
temporary export, diplomatic imports, etc. European Commission online information. Viewed at: 
https://ec.europa.eu/taxation_customs/business/vat/eu -vat-rules-topic/exemptions/other -exemptions_en .  
72 European Commission, Other Exemptions . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/vat_legislation_proposed_en.pdf .  
73 Council of the European Union, Proposal for a Council Directive amending Directive 2006/112/EC as 
regards harmo nising and simplifying certain rules in the value added tax system and introducing the definitive 
system for the taxation of trade between Member States . Viewed at: 
https://www.co nsilium.europa.eu/media/36518/st12564 -en18.pdf .  
74 Council Directive (EU) 2017/2455 of 5 December 2017 amending Directive 2006/112/EC and 
Directive 2009/132/EC as regards certain value added tax obligations for supplies of services and distance 
sales of go ods. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=uriserv:OJ.L_.2017.348.01.0007.01.ENG&toc=OJ:L:2017:348:TOC .  WT/TPR/S/395 • European Union  
 
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  Directive 2008/118/EC , which did not undergo any significant changes during the review period.75 
Four directives cover the structure and minimum rates of excise duty for excise goods.76 They were 
not modified signi ficantly either during the review period.  Despite efforts to harmonize, there are 
still reportedly significant variations in excise duties applied among the member States, that have 
led to implementation issues.77 Goods subject to excise are subject to the tax upon their release for 
consumption, i.e. upon importation into the EU customs territory if imported, or at the time of their 
production or extraction within the territory. For transport between member States, excisable goods 
must be accompanied by an e lectronic Administrative Document (eAD) for goods under duty  
suspension , or a Simplified Administrative Document (SAAD) for goods on which duty has been paid . 
The EU continues to use the Excise Movements and Control System (EMCS)  as the electronic system 
to monitor the movement of excise goods.78 For goods not covered in the harmonized categories, 
the member States may charge excise on other products under certain conditions. Nearly all member 
States have some type of excise duty on a variety of other produc ts (Table A3.2). From the 
information available, Denmark, Malta, and Romania have the largest number of excise duties on 
other products.  
3.58.   In 2018, a Council decision was taken to allow Spain to offer a reduced rate of excise duty for 
electricity supplied to vessels at berth in a port . The decision took effect in January 2019 for a period 
of six years.79 
3.59.   While there have not been any significant changes in the excise duty regime during the review 
period, the Commission proposed a new se ries of rules for excise duties in 2018.80 One proposal is 
to amend the directive on excise duties on alcohol and alcoholic beverages, as it has not kept pace 
with the challenges and opportunities offered by new technologies and developments within the 
alcohol industry. It also points out that there are large variations in the duty rates between member 
States, and this creates incentives for tax evasion and contributes to more burdensome 
compliance.81 Thus, the proposal makes eight specific suggestions to ame nd various articles of the 
directive to address these issues but, in particular, aims to reduce costs for small alcohol -producing 
businesses.  The proposal is still under negotiation with the member States.  
                                                
75 Council Directive 2008/118/EC of 16 December 2008 concerning the general arrangements for excise 
duty and repealing Directive 92/12/EEC . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1456138665149&uri=CELEX:02008L0118 -20140101 ; and European Commission, 
Strategic Plan 2016 -2020. Viewed at: https://ec.europa.eu/info/sites/info/files/strategic -plan-2016-2020-dg-
taxud_march2016_en.pdf .  
76 For energy, Council Directive 2003/96/EC of 27 October 2003 restructuring the Community 
framework for the taxation of energy products and  electricity. Viewed at https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1564477255081&uri=CELEX:32003L0096 ; for tobacco, Council Directive 2011/64/EU of 
21 June 2011 on the structure and rates of excise duty applied to manufactured tobacco. Viewed at: 
https:/ /eur-lex.europa.eu/legal -content/EN/TXT/?qid=1564477389792&uri=CELEX:32011L0064 ; and for 
alcohol, Council Directive 92/83/EEC of 19 October 1992 on the harmonization of the structures of excise 
duties on alcohol and alcoholic beverages. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1564477528158&uri=CELEX:31992L0083 ; and Council Directive 92/84/EEC of 
19 October 1992 on the approximation o f the rates of excise duty on alcohol and alcoholic beverages. Viewed 
at: https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1564477637856&uri=CELEX:319 92L0084 . 
77 Ernst & Young, EMEIA: Excise tax trends . Viewed at: https://www.ey.com/gl/en/services/tax/vat --
gst-and-other -sales-taxes/ey -emeia -excise -tax-trends#accordion -4. 
78 European Commission, Excise Movement and Control System . Viewed at: 
https:/ /ec.europa.eu/taxation_customs/business/excise -duties -alcohol -tobacco -energy/excise -movement -
control -system_en .  
79 Council Implementing Decision (EU) 2018/1491 of 2 October 2018 authorising Spain to apply a 
reduced rate of excise duty to electricity direct ly supplied to vessels at berth in a port, in accordance with 
Article 19 of Directive 2003/96/ECST/11795/2018/INIT. Viewed at: https://eur -lex.europa.eu/ legal-
content/EN/TXT/?qid=1562586291390&uri=CELEX:32018D1491 . 
80 European Commission, Commission proposes a series of new rules on excise duties . Viewed at: 
https://ec.europa.eu/taxation_customs/news/commission -proposes -series -new-rules-excise -duties_en .  
81 European Commission, Proposal for a COUNCIL DIRECTIVE amending Directive 92/83/EEC on the 
harmonization of the structures of excise duties on alcohol and alcoholic beverages . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/25_05_2018_proposal_excise_duties_alcohol.pdf . WT/TPR/S/395 • European Union  
 
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  Table 3.6 Minimum excise duties on EU harmonized products, 2020  
Category  Minimum rate  Unit 
Alcohol:  
Beer 
Wine 
Intermediate products  
Spirits   
EUR 0.748 or EUR  1.87 
EUR 0  
EUR 45  
EUR 550  
Hl per degree Plato or hl per degree alcohol  
Hl of volume  
Hl of volume  
Hl of volume  
Energy and electricity:  
For motor fuels  
Leaded petrol  
Unleaded petrol  
Gas oil  
Kerosene  
LPG 
Natural gas  
For commercial/industrial use  
Gas oil  
Kerosene  
LPG 
Natural gas  
For heating and electricity  
Gas oil  
Heavy fuel oil  
Kerosene  
LPG 
Natural gas  
Coal and coke  
Electricity   
 
421 
359 
330 
330 
125 
2.6 
 
 
21 
21 
41 
0.3 
 
21 
15 
0 
0 
0.15 or 0.3b 
0.15 or 0.3b 
0.5 or 1.0b  
 
EUR per 1 ,000 litres 
EUR per 1 ,000 litres 
EUR per 1 ,000 litres 
EUR per 1 ,000 litres 
EUR per 1,000 kg  
EUR per gigajoule  
 
 
EUR per 1 ,000 litres 
EUR per 1 ,000 litres 
EUR per 1 ,000 kg  
EUR per 1 ,000 litres 
 
EUR per 1 ,000 litres 
EUR per 1 ,000 kilos 
EUR per 1 ,000 litres 
EUR per 1 ,000 kg  
EUR per 1 ,000 litres 
EUR per 1 ,000 litres 
EUR per MWh  
Tobacco products:  
Fine-cut smoking tobaccoa 
 
Cigars and cigarillos  
 
Other smoking tobaccos  
 
Cigarettes   
48% or  EUR 60 
 
5% or EUR 12 
 
20% or  EUR 22 
 
7.5% to 76.5%  
 
 
  
Of the weighted average retail selling price  
per kg  
Of the retail selling price  
per 1 ,000 or per kg 
Of the retail selling price  
per kg  
Specific component  - of the total tax burden  
Ad valorem  component  -% of the maximum 
retail selling price  
Overall excise  — at least EUR 90 per 
1,000  cigarettes and 60% of the weighted 
average retail selling price  
a To gradually increase t o 50% or EUR 60 by 2020.  
b The lower rate applies to businesses, the higher rate applies for non -businesses.  
Source:  European Commission, Excise Duties on Tobacco . Viewed at: 
https://ec.europa.eu/taxation_customs/business/excise -duties -alcohol -tobacco -energy/excise -
duties -tobacco_en ; Excise Dut y on Alcohol . Viewed at:  
https://ec.europa.eu/taxation_customs/business/excise -duties -alcohol -tobacco -energy/excise -
duties -alcohol_en ; and  Excise Dut y on Energy. Viewed at:  
https://ec.europa.eu/taxation_customs/business/excise -duties -alcohol -tobacco -energy/excise -
duties -energy_en . 
3.60.   A second  proposal, also from 2018, is aimed at addressing shortfalls in the directive on the 
general arrangements for goods subject to excise.82 Certain shortfalls were identified, in particular 
for exportation, export followed by transit, importation, duty paid bu siness -to-business, low -risk 
movements, and exceptional circumstances.83 With respect to importation, particular difficulty was 
noted regarding the tracking of excisable goods moved under duty suspension between member 
States after importation. Therefore, t he proposal focuses on implementing new procedures for 
tracking, in particular on the declarant to provide additional information during the import, export, 
                                                
82 Council Directive 2008/118/EC of 16  December 2008 concerning the general arrangements for excise 
duty and repealing Directive 92/12/EEC. View ed at: https://eur -lex.europa.eu/legal -
content/GA/TXT/?uri=CELEX:32008L0118 .  
83 European Commission, Impact Assessment . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/25_05_2018_proposal_for_general_arrangements_f
or_excise_duties_impact_assessm ent.pdf .  WT/TPR/S/395 • European Union  
 
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  or transit processes.84 Two other proposals concern administrative cooperation regard ing the content  
of the electronic register , and computerizing the movement and surveillance of excise goods.85 The 
proposals are still under negotiation with the member States.  
3.1.5   Import prohibitions, restrictions, and licensing  
3.61.   The EU continues to have in place a number of import prohibitions, restrictions, and licensing 
requirements on imports. The number of these increased during the period, and none were removed. 
There are 12 specific groups of products subject to restrictions or prohibition (Table  3.7), 11 subject 
to imp ort permits or licences (Table 3. 8), and another 2 measures approved but not yet entered into 
force. In addition to the new measures entering into force on aluminium (surveillance), tungsten, 
and invasive species, there were several amendments or changes t o a number of the existing 
regulations already in force.  
3.62.   The EU also has a number of surveillance mechanisms in place on imports which are not 
discussed in this Section. These are most notably in the agricultural sector, in order to determine 
quota levels  or trigger prices (Section 4.1), for safeguards (Section 3.1.6.2), or for monitoring 
certain products pursuant to FTAs or other agreements, i.e. bananas.86 There are also a number of 
monitoring, control, or restrictive measures put in place for TBT, SPS, l abelling, and sanctions 
(Sections 3.1.7 and 3.3). Two measures are now in place concerning surveillance measures, i.e.  steel 
and aluminium (Section 3.1.6.2). T he EU has import prohibitions on cat and dog fur, including  
products thereof; and seal products.87 
3.63.   Previously, the EU had introduced a regulation on invasive alien species (IAS), i.e. plants, 
insects and animals, in 201488, but its implementation was dependent upon a list of applicable 
species being identified. A first list was set out in a regulation i n 2016, and a second list in 2017.89 
As at July 2019, a third list was under consideration and was open to public comment.90 Thus, the 
listed IASs (49 species listed thus far) cannot be brought into the territory of the EU; be kept in, 
bred in, or transit through the EU; nor be sold, possessed, or released into the environment.91 
However, there are some exceptions, and controlled imports may be authorized for scientific 
research and conservation activities  for example.  
                                                
84 European Commission, Proposal for a COUNCIL DIRECTIVE laying down the general arrangements for 
excise duty (recast) . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/25_05_2018_proposal_for_general_arrangements_f
or_excise_duties.pdf .  
85 European Commission, Proposal for a Council Regulation amending Regulation (EU) No. 389/2012 on 
administrative cooperation in the field of excise duties as regards the content of electronic register . Viewed at: 
https://ec. europa.eu/taxation_customs/sites/taxation/files/25_05_2018_proposal_exciseduties_electronicregis
ter_en.pdf ; and Proposal for a Decision of the European Parliament and of the Council on computerising the 
movement and surveillance of excise goods (recast ). Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/25_05_2018_proposal_on_emcs.pdf .  
86 Regulation (EU) 2017/852 of the E uropean Parliament and of the Council of 17 May 2017 on mercury, 
and repealing Regulation (EC) No. 1102/2008. Viewed at: https://eur -lex.europa.eu /legal -
content/EN/TXT/PDF/?uri=uriserv:OJ.L_.2017.137.01.0001.01.ENG .  
87 The restrictions on cat and dog fur also apply for exportation.  
88 Regulation (EU) No. 1143/2014 of the European Parliament and of the Council of 22  October 2014 on 
the prevention and management of the introduction and spread of invasive alien species. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1417443504720&uri=CELEX:32014R1143 .  
89 Regulation (EU) 2016/1141  of 13 July 2016 adopting a list of invasive alien species of Union concern 
pursuant to Regulat ion (EU) No. 1143/2014 of the European Parliament and of the Council C/2016/4295. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32016R1141 ; and Commission 
Implementing Regulation (EU) No. 2017/1263 of 12 July 2017 updating the list of invasive alien species of 
Union concern established by Implementing Regulation (EU) 2016/1141 pursuant to Regulation (EU) 
No. 1143/2014 of the European Parliament an d of the Council. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=uriserv:OJ.L_.2017.182.01.0037.01.ENG . 
90 European Commission, Updated list of invasive non -native species in the EU . Viewed at: 
https://ec.europa.eu/info/law/better -regulation/initiatives/ares -2019-1565888_en .  
91 Publications Office of the European Union, Invasive alien species . Viewed at: 
https://publications. europa.eu/en/publication -detail/ -/publication/6f9e5ecf -c81f-11e6-a6db-
01aa75ed71a1/language -en/format -PDF.  WT/TPR/S/395 • European Union  
 
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  3.64.   In 2017, the EU also put in pla ce new import prohibitions on the import of mercury and certain 
mercury compounds or products.92 This new regulation replaces a previous one that only restricted 
exports (Section 3.2.3).93 Thus, pursuant to the EU's Seventh Environment Action Programme a nd 
the Minamata Convention on Mercury of 2013 , the EU prohibited the export, import and 
manufacturing of mercury, mercury compounds, and a range of mercury -added products .94 
However, there are certain phased -in restrictions pertaining to a number of products, i n particular 
for dental amalgams, until 2021.  
3.65.   In 2019, the EU codified Regulation (EC) 1236/2005 on trade in certain goods which could be 
used for capital punishment, torture or other cruel, inhuman or degrading treatment or punishment, 
and its subsequent amendments, into Regulation (EU) 2019/125  (which applies to both imports and 
exports).95 The codified Regulation does not make any changes; it merely consolidates the previous 
amendments. It is also noted that, prior to the codification,  during the review p eriod, Commission 
Delegated Regulation (EU) 2018/181 amended the list of relevant third countries in the Union 
General Export Authorisation  (UGEA), adding the Dominican Republic, Saõ Tome and Principe, and 
Togo to the list of relevant countries.96  
3.66.   At the 1 7th meeting of the Conference of the Parties to the Convention on International Trade 
in Endangered Species of Wild Fauna and Flora  (CITES) in 2016 , certain amendments97 were made 
to the Appendices to the Convention. These amendments are reflected in a Comm ission Regulation98 
of 20 January 2017 amending the EU "CITES Regulation"99, by replacing its Annexes. These Annexes 
generally correspond to the CITES Appendices.100 Further small changes to a related Commission 
Regulation101 were made in 2019102, by laying down d etailed rules for the import or re -export of live 
rhinoceroses or live elephants , specifying that horn or ivory from those animals or from their progeny 
may not enter commercial trade or commercial activities within the EU. At the same time, the list of 
standard nomenclature references was also amended.  
3.67.   Another development during the review period was the negotiation and signing of Voluntary 
Partnership Agreements (VPA s), and the establishment of a Forest Law Enforcement, Governance 
and Trade  (FLEGT ) licensing scheme for imports of timber into the European Community103, which 
                                                
92 Regulation (EU) No. 2017/852 of the European Parliament and of the Council of 17 May 2017 on 
mercury, and repealing Regulation (EC) No. 1102/2008.  Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=uriserv:OJ.L_.2017.137.01.0001.01.ENG .  
93 Regulation (EC) No. 1102/2008 of the  European Parliament and of the Council of 22 October 2008 on 
the banning of exports of metallic mercury and certain mercury compounds and mixtures and the safe storage 
of metallic mercury. Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=celex%3A32008R1102 . 
94 See Annexes I and II to Regulation (EU) No. 2017/852.  
95 Regulation (EU) No. 2019/125 of the European Parliament and of the Council of 16 January 2019 
concerning trade in certain goods which could be used for capital punishment, torture or other cruel, inhuman 
or degrading treatment or punishment. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=uriserv:OJ.L_.2019.030.01.0001.01.ENG .  
96 Commission Delegated Regulation (EU) No. 2018/181 of 18 October 2017 amending Annex IIIb to 
Council Regulation (EC) No. 1236/2005 concerning trad e in certain goods which could be used for capital 
punishment, torture or other cruel, inhuman or degrading treatment or punishment. Viewed at: https://eur -
lex.europa.eu /legal -content/EN/TXT/?uri=CELEX%3A32018R0181 .  
97 CITES, Final decisions made at CoP17 on the proposals to amend CITES Appendices . Viewed at: 
https://cite s.org/sites/default/files/eng/cop/17/Decisions -on-amendment -proposals.pdf . 
98 Commission Regulation (EU) 2017/160 of 20 January 2017 amending Council Regulation (EC) 
No. 338/97 on the protection of species of wild fauna and flora by regulating trade therein . Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1490275269610&uri=CELEX:32017R0160 . 
99 Council Regulation (EC) No. 338/97 of 9 December 1996 on the protection of species of wild fauna 
and flora by regulating trade therein, which is transposing the CITES provisions at EU level. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1484753427128&uri=CELEX:01997R0338 -20170204 .  
100 The EU has, in some cases, adopted stricter measures than what is required by CITES, by including  
non-CITES -listed species or setting stricter import conditions for listed species.  
101 Commission Regulation (EC) No. 865/2006 of 4 May 2006 laying down detailed rules concerning the 
implementation of Council Regulation (EC) No. 338/97 on the protection of  species of wild fauna and flora by 
regulating trade therein. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1484753534360&uri=C ELEX:02006R0865 -20190227 .  
102 Commission Regulation (EU) 2019/220 of 6 February 2019 amending Regulation (EC) No. 865/2006 
laying down detailed rules concerning the implementation of Council Regulation (EC) No. 338/97 on the 
protection of species of wild fa una and flora by regulating trade therein. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32019R0220 . 
103 Council Regulation (EC) No. 2173/2005 of 20 December 2005 on the establishment of a FLEGT 
licensing scheme for imports of timber into the European Community. Viewed at: https://eur -WT/TPR/S/395 • European Union  
 
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  is part of the FLEGT Action Plan.104 The Plan sets out the EU response to combatting illegal harvesting 
of timber and associated trade, by improving forest governance, strengthening law enforcement and 
promoting trade in legally -harvested timber and timber products. Under the VPA, partner countries 
develop systems to verify the legality of their timber exports to the EU and a licensing system to 
provide assurance that timber imported into the EU has been harvested in compliance with the legal 
requirements of the partner country, as set out in the relevant FLEGT VPA.  To date, the EU has 
signed VPAs with Ghana, the Republic of Congo, Cameroon, Indonesia, the Central African Republic,  
Liberia, and Viet Nam.105 As of September 2019, Indonesia was the only VPA country with an 
operational FLEGT licensing scheme.106 The EU concluded negotiations and initial led VPA s with 
Honduras107 and Guyana .108 It is in the process of conducting negotiations with a further 
six countries.109 Each VPA generally contains provisions on a list of products covered by the HS code, 
rules for the licensing scheme, monitoring and evaluation, and reporting and communication 
provisions.  
3.68.   The regulation on the export and import of h azardous chemicals was amended twice during 
the review period, to amend the annexes containing the chemicals covered.110 Basically, chemicals 
were added to the lists of those subject to requirements or restrictions on export, due to changes in 
EU law or in t he underlying conventions, i.e.  the Rotterdam Convention o n the Prior Informed 
Consent Procedure for certain hazardous chemicals and pesticides in international trade , and the 
Stockholm Convention on Persistent Organic Pollutants.  
3.69.   Licences or permits for products subject to licensing are handled by certain EU services, 
e.g. DG Agriculture and Rural Development, or relevant authorities in the member States. For certain 
products, e.g. steel, aluminium, and wood111, they are tracked and monitored by the Système  
Intégré de Gestion de Licences (SIGL), which provides updated information on steel quotas pursuant 
to the safeguard action, for example.112 
3.70.   The EU and other participants to the Kimberley P rocess on rough diamonds have been covered 
under a WTO waiver for certain GATT  1994 provisions, both for importation and exportation. This 
waiver was recently extended to cover the period 2019 -24.113 The EU continued to require import 
licences for the importation of certain sugar products from certain EBA beneficiaries dur ing the 
review period, but this provision expired in September 2017.114  
                                                
lex.europa.eu/legal -content/EN/ TXT/?uri=CELEX:32005R2173 ; and Commission Regulation (EC) 
No. 1024/2008 of 17  October 2008 laying down detailed measures for the implementation of Council 
Regulation (EC) No.  2173/2005 on the establishment of a FLEGT licensing scheme for imports of timber into 
the European Community. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX:32008R1024 .  
104 Communication from the Commission to the Council and the E uropean Parliament - Forest Law 
Enforcement, Governance and Trade (FLEGT) - Proposal for an EU Action Plan. Viewed at: https://eur -
lex.europa.eu/legal -content/SL/TXT/?uri =CELEX:52003DC0251 . 
105 European Commission, FLEGT Regulation – FLEGT Voluntary Partnership Agreements (VPAs) . Viewed 
at: http://ec.europa.eu/environment/forests/flegt.htm .  
106 EUR-Lex, Voluntary Partnership Agreement between the European Union and the Republic of 
Indonesia on forest law enforcement, governance and trade in timber products into the European Union . 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=uriserv:OJ.L_.2014.150.01.0252.01.ENG . 
107 The EU and Honduras concluded negotiations and initialled the VPA on 15 June 2018.  
108 The EU and Guyana conclude d negotiations and initialled the VPA on 23 November 2018 . 
109 European Commission,  FLEGT Regulation – FLEGT Voluntary Partnership Agreements (VPAs) . Viewed 
at: http://ec.europa.eu/environment /forests/flegt.htm . 
110Commission Delegated Regulation (EU) No. 2018/172 of 28 November 2017 amending Annexes I and 
V to Regulation (EU) No. 649/2012 of the European Parliament and of the Council concerning the export and 
import of hazardous chemicals. Viewe d at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=celex:32018R0172 ; and Commission Delegated Regulation (EU) 2019/330 of 
11 December 2018 amending Annexes I and V to Regulation (EU) No. 649/2012 of the European Parliament 
and of the Council concerning the export and import of hazardous chemicals. Viewed at: https://eur -
lex.europa.eu /legal -content/EN/TXT/?uri=celex:32019R0330 .  
111 Pursuant to the Russian Federation's export TRQ.  
112 European Commission, Système Intégré de Gestion de Licences . Viewed at: 
https://webgate.ec .europa.eu/siglbo/public/reports .  
113 WTO document WT/L/1039, 30 July 2018.  
114 Commission Implementing Regulation (EU) No. 2015/1550 of 17 September 2015 laying down rules 
for the application of Regulation (EU) No. 1308/2013 of the European Parliament and of the Council as regards 
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  3.71.   Similar to the aim of the Kimberley Process, the EU implemented a new regulation in 2017 to 
apply the Organisation for Economic Cooperation and Development (OECD) Due Diligence Guidance  
for Responsible Supply Chains of Minerals from Conflict -Affected and High -Risk Areas , in order to 
limit human rights abuses and prevent the financing of armed groups in resource -rich areas.115 The 
Conflict Minerals Regulation (CMR) applies to EU importers o f tin, tungsten, tantalum and gold. As 
of 1 January 2021, EU importers of these metals and minerals with annual import volumes above a 
certain threshold must undertake supply chain due diligence. This implies that they must identify 
and mitigate the risk o f conflict -financing in their supply chains ; and they must also keep detailed 
records of suppliers, country of origin, and quantities and dates of extraction of the minerals or 
metals imported. These records are subject to compliance and ex post checks by specially -
designated competent authorities in each member State. Annex I to the CMR sets out the applicable 
import thresholds. For five minerals and metals, though (e.g. tantalum, gold ores and concentrates, 
tin oxides) , the thresholds will be established at the latest by July 2020.  
3.72.   Furthermore, the EU introduced a proposal for a single -use plastics directive in 2018. This 
Directive was adopted on 5 June 2019.116 Member States must transpose the Directive into law by 
3 July 2021. The Directive would restrict certain plastic products, e.g. plates, cutlery, beverage 
containers, from being placed on the EU market, and impose an extended producer responsibility 
for the cost of clean -up activities on a list of similar plastic products used mainly in the food and 
beverage sector, as well as tobacco products, fishing gear, and balloons.117  
3.73.   Another regulation that entered into force in July concerns the prohibition of certain persistent 
organic pollutants.118 The EU put in place these measures pursuant to its participatio n in the Protocol 
to the 1979 Convention on Long -Range Transboundary Air Pollution on Persistent Organic Pollutants , 
and t he Stockholm Convention on Persistent Organic Pollutants . The annex to the regulation 
currently identifies about 26 chemicals where th e manufactur e, placing on the market , and use  is 
prohibited; it also has certain waste management provisions, i.e. recovery and disposal. It should 
be noted that this regulation is a recast of an earlier regulation adopted in 2004 (Regulation (EC) 
No. 850/2004 on persistent organic pollutants) .  
3.74.   The EU continued to update Council Regulation (EU) No . 111/2005 of 22 December 2004 on 
the monitoring of trade for drug precursors by  the addition of substances to be scheduled for control 
and monitoring. The sc heduling of such substances is carried out so as to achieve a proportionate 
balance between the level of threat posed by each specific substance and the burden on licit trade. 
Both Commission Delegated Regulation (EU) No . 2016/1443 of 29 June 2016 and Comm ission 
Delegated Regulation (EU) No . 2018/729 of 26 February 2018 included certain drug precursors in 
the list of scheduled substances in the Annex of Regulation (EU) No . 111/2005 . 
3.75.   A new regulation that was approved on 17 April 2019 concerns the import of cultural goods, 
which will prohibit the introduction into the EU of cultural goods illicitly exported from third countries 
("general prohibition" rule) and will lay down the conditions and procedures for the import of cultural 
goods into the EU. The import  of cultural goods – i.e. their release for free circulation or their 
placement under special customs procedures – will be subject to (i) an import licence issued by a 
member State competent authority for archaeological objects and parts of monuments; or ( ii) for 
less-sensitive cultural goods, the submission to customs of an importer statement. The regulation 
                                                
years 2015/16 and 2016/17 . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32015R1550&rid=1 .  
115 Regulation (EU) 2017/821 of the European Parliament and of the Council of 17 May 2017 laying 
down supply chain due diligence obligations for Union i mporters of tin, tantalum and tungsten, their ores, and 
gold originating from conflict -affected and high -risk areas. Viewed at: https://eur -lex.europa.eu/legal -
content/E N/TXT/?uri=CELEX%3A32017R0821 . 
116 European Commission, Proposal for a Directive of the European Parliament and of the Council on the 
reduction of the impact of certain plastic products on the  environment . Viewed at: 
http://ec.europa.eu/environment/circular -economy/pdf/single -use_plastics_proposal.pdf . Directive (EU) 
2019/904 of the of the European Parliament and of the Council of 5 June 2019 on the reduction  of the impact 
of certain plastic products on the environment. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=ur iserv:OJ.L_.2019.155.01.0001.01.ENG&toc=OJ:L:2019:155:TOC .  
117 European Commission, Annex to the Proposal for a Directive of the European Parliament and of the 
Council on the reduction of the impact of certain plastic products on the environment . Viewed at:  
http://ec.europa.eu/environment/circular -economy/pdf/single -use_plastics_proposal_annex.pdf .  
118 Regulation (EU) 2019/1021 of the European Parliamen t and of the Council of 20 June 2019 on 
persistent organic pollutants. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562229423179&uri=C ELEX:32019R1021 .  WT/TPR/S/395 • European Union  
 
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  will be supported by a centralized electronic system. Most provisions of the regulation will apply 
six years after its entry into force, i.e. once the  electronic system becomes operational. In the 
meantime, one provision, namely the general prohibition rule, will apply 18 months after the entry 
into force.  
Table 3.7 Prohibitions or restrictions on imports, 2019 
Product  Measure  Rationale  Legislation  
Substances that 
deplete the ozone 
layer Prohibition/restriction  Montreal Protocol  Regulation (EC) 
No. 1005/2009  
Certain hazardous 
chemicals  Prohibition/restriction  Rotterdam Convention on the 
Prior Informed Consent 
Procedure for Certain 
Hazardous  Chemicals and 
Pesticides in Internation al 
Trade  Regulation (EU) 
No. 649/2012; 
Commission 
Implementing Decision of 
10 October  2018 
Persistent organic 
pollutants  Prohibition/restriction  Stockholm Convention on 
Persistent Organic Pollutants  Regulation (EU) 
2019/1021  
Cultural goods  Prohibition  To protect against the 
trafficking of such materials  Regulation (EU) 2019/880  
Certain animal and 
plant species  Prohibition/restriction  CITES  Council Regulation (EC) 
No. 338/97  
Fluorinated 
greenhouse gases  Prohibition/restriction  Targeted reduction of 
greenhouse gases pursuant 
to the Intergovernmental 
Panel on Climate Change 
(IPCC) of the United Nations  
Framework Convention on 
Climate Change (UNFCCC)  Regulation (EU) 
No. 517/2014  
Invasive alien species 
(IAS)  Prohibition/restriction  To prevent negative 
consequences to the 
environment  Regulation (EU) 
No. 1143/2014 ; 
Regulation (EU) 
2016/1141 ; and 
Commission 
Implementing Regulation 
(EU) 2017/1263  
Mercury and mercury 
products  Prohibiteda Minamata Convention on 
Mercury  Regulation (EU) 2017/852  
Certain goods which 
could be used for 
capital punishment, 
torture or other cruel, 
inhuman or degrading 
treatment or 
punishment  Prohibition  Protection of huma n life or 
health, protection of public 
morals  Regulation (EU) 2019/125  
Waste  Prohibition/restriction  Basel Convention for the 
Control of Trans boundary  
Movements of Hazardous 
Waste and their Disposal  
OECD Decision on the control 
of transboundary movements 
of wastes destined for 
recovery operations  Regulation (EC) 
No. 1013/2006 and its 
subsequent amendments  
Bluefin tuna  Prohibition/restriction  International Convention for 
the Conservation of Atlantic 
Tunas  Regulation (EU) 
No. 640/2010  WT/TPR/S/395 • European Union  
 
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  Product  Measure  Rationale  Legislation  
Fish of vessels from 
Cambodia, Comoros, 
and Saint Vincent and 
the Grenadines  Prohibition  Protection of animal life and 
health and the environment, 
and conservation of natural 
resources  Regulation (EC) 
No. 1005/2008; Council 
Implementing Decision of 
24 March 2014; Council 
Implementing Decision 
(EU) 2017/1332 ; Council 
Implementing Decision 
(EU) 2017/1333 ; and 
Council Implementing 
Decision (EU) 2016/1818  
a The import ban is g radually being  phased in, depending on the type of product, from 2018 to 2021.  
Source:  WTO document G/MA/QR/N/EU/4 , 28 September 2018;  and information compiled from th e TARIC.  
Table 3.8 Products subject to import licensing,  2019 
Product  Regime  Automatic/  
non-
automatic  Legislation  
Textiles  Autonomous regime 
governing imports from 
the Democratic People's 
Republic of Korea; 
outward processing 
traffic arrangements; 
surveillance regime  Non-automatic  Regulation (EU) 2015 /936;  
Regulation (EU) No. 2016/2148 ; and 
Regulation (EU) No . 2017/1509  
The EU maintains 
licensing requirement s 
only for the following 
products:  
• rice; 
• hemp seeds for 
sowing, raw hemp, 
hemp seeds not for 
sowing;  
• ethyl alcohol of 
agricultural origin.  
However, when it 
comes to the 
management of 
agricultural TRQs, the 
EU manage s them 
through a licensing 
system for the 
following products:  
• cereals and rice ; 
• sugar; 
• milk and milk 
products ; 
• beef and veal ; 
• pigmeat ; 
• poultry meat ; 
• eggs and products 
in the egg s ector 
and egg albumin ; 
• garlic; 
• preserved 
mushrooms ; 
• ethyl alcohol from 
agricultural origin ; 
and 
• hemp  To monitor trade flows 
and administer TRQs  Non-automatic  Regulation (EU) No.  2016/1237 ; and 
Regulation (EU) 2016/1239  WT/TPR/S/395 • European Union  
 
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  Product  Regime  Automatic/  
non-
automatic  Legislation  
Steela Surveillance system and 
safeguard  Automatic and 
non-automatic  Commission Implementing 
Regulation (EU) No. 2016/670; 
Regulation (EU) 2015/755; 
Regulation (EU) 2015/478; and 
Commission Implementing 
Regulation (EU) 2019/159  
Aluminium  Surveillance system  Automatic  Commission Impleme nting 
Regulation (EU) 2018/640  
Fluorinated gases 
including 
hydrofluorocarbons 
(HFCS)  Licensing and quota 
system  Non-automatic  Regulation (EU) No . 517/2014;  and 
Regulation (EU) No . 2019/661  
Ozone -depleting 
substances  (ODS) 
(controlled substances)  To control prohibited or 
restricted ODS goods  Non-automatic  Regulation (EC) No.  1005/2009  
Rough diamonds  To implement the 
Kimberley Process 
Certification Scheme  Non-automatic  Regulation (EC) No.  2368/2002  
Waste shipment  To control the import of 
waste and hazardous 
waste pursuant to the 
Basel Convention  Automatic  Regulation (EC) No.  1013/2006  
Timber  and timber 
products  To ensure that only 
legally -harvested 
timber , and products 
made thereof , is 
exported to the EU from 
count ries operating the 
FLEGT licensing scheme  Automatic  Council Regulation No.  2173/2005 ; 
and Commission Regulation (EC) 
No. 1024/2008  
Endangered species 
(CITES)  To control imports of 
endangered species 
listed in CITES  Non-automatic  Council Regulation (EC) No.  338/97 ; 
Commission Regulation (EC) 
No. 865/2006; Commission 
Implementing Regulation (EU) 
No. 792/2012; and Commission 
Implementing Regulation (EU) 
No. 2017/1915  
Drug precursors  To monitor trade and 
authoriz e imports of 
drug precursors  Automatic  Commission Delegated Regulation 
2016/1443 of 29 June 2016 ; and 
Commission Delegated Regulation 
2018/729 of 26 February 2018  
a Those subject to the safeguard are not subject to surveillance.  
Source:  WTO document G/LIC/N/3/EU/8, 25 September 2019 ; and information provided by th e authorities.  
3.1.6   Anti-dumping, countervailing, and safeguard measures  
3.1.6.1   Anti-dumping and anti -subsidy measures  
3.76.   The EU has emphasized the importance of WTO trade remedy rules as a legitimate tool to 
combat trade distortions and unfair trade practices by others and, through its legislation, applies 
these measures with rigour and consistency.119 Indeed, the EU is a significant user of trade remedy 
measures as, historically, it ranks third overall among  WTO Members in the imposition of 
anti-dumping measures since the WTO's inception and second for countervailing (CVD) measures, 
or anti -subsidy measures as the EU legislation refers to them.120 At the same time, the EU has 
generally been a low recipient of a nti-dumping or CVD measures by other Members, i.e. ranking 
                                                
119 European Commission, Commission Staff Working Document accompanying the 37th Annual Report 
from the Commission to the European Parliament and the Council on the EU's Anti -Dumping, Anti -Subsidy and 
Safeguard activities. Viewed at: http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157811.pdf .  
120 WTO, Anti-dumping Measures: By Reporting Member . Viewed at: 
https://www.wto.org/english/tratop_e/adp_e/AD_MeasuresByRepMem.pdf ; and Countervailing Measures: By 
Reporting Member. Viewed at: https://www.wto.org/english/tratop_e/scm_e/CV_MeasuresByRepMem.pdf .  WT/TPR/S/395 • European Union  
 
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  12th overall for anti -dumping and 4th for CVD measures.121 According to the Commission, about 
0.29% of total imports were impacted by anti -dumping or anti -subsidy measures in 2018.122  
3.77.   The last Review enumerated the main EU rules on anti -dumping and anti -subsidies which had 
been replaced by new codified versions in  2016 ( Regulation s (EU) 2016/1036  and (EU) 2016/1037 ); 
these remain in place and continue to form the basic rules on anti -dumping and anti -subsidy 
measures for the EU.123 However, there have been significant developments, with two  new 
regulations entering in to force, resulting in the amendment of these Regulations.  
3.78.   The first set of changes were introduced in 2017, and added language with respect to "normal 
value". In essence, this allows for the normal value to be determined by another method where 
there are state-induced distortions in the exporting country. In such circumstances, normal value is 
determined on the basis of costs of production and sale reflecting undistorted prices , or of 
benchmarks  such as international prices or costs in another representati ve country.124 A different 
methodology for determining the normal value is set out for non -WTO Members.  
3.79.   The changes set out in the second amendment in 2018 are more numerous and diverse; the 
main elements are outlined in Box 3.2.125 As illustrated, the changes  involve procedural aspects, 
such as shortening the time -period for provisional measures, and more substantial aspects, such as 
how the injury margins are calculated. For example, in calculating the non -injurious price, a 
minimum profit of 6% is included. Another new development is the ability to take into account the 
presumably higher costs of EU industry compliance with social and environmental standards.  
Box 3.2 Main elements o f the trade remedy modernization,  2018  
- More transparency and  predictability  Interested parties are informed three weeks in advance of the 
imposition of provisional measures.  
- Faster  anti-dumping 
 investigations  The time -period for the introduction of provisional measures 
was reduced from 9 to normally 7 or maximum 8 months.  
- Additional support for EU SMEs  A dedicated webpage and helpdesk were established for SMEs.  
- A change in  injury margin 
 calculation method  New rules for the non -injurious price were put in place, 
reflec ting profitability, future expenses, etc.  
- Inclusion of social and environmental 
 considerations  Implementation of social and environmental standards are 
taken into account : 
 - in determining target price for EU industry; and  
 in considering undertaking offers.  
                                                
121 WTO, Anti-dumping Sectoral Distribution of Measures: By Exporting Country . Viewed at: 
https://www.wto.org/english/tratop_e/adp_e/AD_Sectoral_MeasuresByExpCty.pdf ; and Countervailing 
Measures: By Exporting Country. Viewed at: 
https://www.wto.org/english/tratop_e/scm_e/CV_MeasuresByExpCty.pdf .  
122 European Commission, 36th Annual Report from the Commission to the Council and the European 
Parliament on the EU's Anti -Dumping, Anti -Subsidy and  Safeguard activities (2017).  Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157212.pdf ; and information provided by the 
authorities.  
123 Regulation (EU) 201 6/1036 of the European Parliament and of the Council of 8 June 2016 on 
protection against dumped imports from countries not members of the European Union. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32016R1036 ; and Regulation (EU) 2016/1037 
of the European Parliament and of the Council of 8 June 2016 on protection against subsidised imports from 
countries not members of the European Union. Viewe d at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32016R1037 .  
124 Regulation (EU) No. 2017/2321 of the European Parliament and of the Council of 12 Decemb er 2017 
amending Regulation (EU) 2016/1036 on protection against dumped imports from countries not members of 
the European Union and Regulation (EU) 2016/1037 on protection against subsidised imports from countries 
not members of the European Union. Viewed  at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32017R2321 . 
125 Regulation (EU) No. 2018/825 of the European Parliament and of the Council of 30 May 2018 
amending Regulation (EU) 2016/1036 on protection against dumped imports from countries not members of 
the European Union and Regulation (EU) 2016/1037 on protection against subsidised imports from countries 
not members of the European Union. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32018R0825 . WT/TPR/S/395 • European Union  
 
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  - Changes to the use of the lesser  duty 
 rule (LDR)   - In anti -dumping cases,  raw material distortions will result 
 in a modulation of the LDR  
 - In CVD cases, the LDR will not apply unless it is against 
 the EU interest.  
- Better response to threats of 
 retaliation  Clarification that threats of retaliation to industry qualify as on e 
of the special circumstances just ifying  ex officio  investigations.  
- Participation of trade unions in 
 investigations  The rules now allow trade unions to be interested parties in 
investigations.  
- New rules in the EU continental shelf 
 and exclusive economic zones  Allows for trade remedy measures to be applicable to these 
regions of the EU.  
- Reimbursement of duties  Repayment of duties collected while an expiry review is 
ongoing, if that review is terminated without the extension of 
the measures.  
Source:  European Commission, Commi ssion Staff Working Document accompanying the 37th Annual Report 
from the Commission to the European Parliament and the Council on the EU's Anti -Dumping, 
Anti-Subsidy and Safeguard activities (2018).  Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157811.pdf ; and information provided by 
the authorities.  
3.80.   There were also other developments in other EU legislation rel ating to trade remedies. The 
EU has long -standing legislation on unfair pricing and subsidies for airline services from 2004 that 
was being reviewed at the time of the last Review.126 In 2019, a new regulation on safeguarding 
competition in air transport  entered into force, and replaced the previous one from 2004.127 The new 
legislation aims to address concerns about unfair practices by third countries and third -country 
entities, in particular those that may benefit from subsidies or other forms of state aid . An 
investigation may be initiated by a member State, an EU airline , an association of EU airlines , or by 
the Commission  itself. Procedurally, it follows the main trade remedy rules of initiation, conducting 
an investigation, determining injury or threat of injury, and adoption of redressive measures. The 
redressive measures can be either financial duties or any operational measure of equivalent or lesser 
value, such as the suspension of concessions, of services owed , or of other rights of the third -country 
air carrier . 
3.81.   Pursuant to a decision of the President of the European Commission in 2019, the specific 
function and terms of reference of a "hearing officer" were updated to reinforce the transparency 
and fairness of trade proceedings .128 In particular, the he aring officer is to safeguard the procedural 
rights of the interested parties  in a variety of trade -related regulations, in particular to the rules 
governing anti -dumping, anti -subsidy, and safeguard investigations.129 For example, the hearing 
officer has a role in organizing and conducting hearings on behalf of interested parties.  
                                                
126 Regulation (EC) No. 868/2004 of the European Parliament and of the Council of 21 April 2004 
concer ning protection against subsidisation and unfair pricing practices causing injury to Community air 
carriers in the supply of air services from countries not members of the European Community. Viewed at: 
http://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32004R0868&from=EN .  
127 Regulation (EU) No. 2019/712 of the European Parliament and of the Council of 17 April 2019 on 
safeguarding competition in air tr ansport, and repealing Regulation (EC) No. 868/2004. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?qid=1562259754125&uri=CELEX:32019R0712 .  
128 Decision (EU) No. 2019/339 of the President of the European Commission of 21 February 2019 on 
the function and terms of reference of the hearing officer in certain trade proceedings. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?qid=1562238230941&uri=CELEX:32019D0339 .  
129 Regulation (EU) No. 2016/1036 and, in particular, Arts. 5(10) and (11), 6(5) -(8),8(3), (4) and (9), 
and 18 -21 thereof; Reg ulation (EU) 2016/1037 and, in particular, Arts.  10(12) and (13), 11(5) -(8) and (10), 
13(3), (4) and (9), and 28 -31 thereof; Regulation (EU) 2015/478 of the European Parliament and of the 
Council (6) and, in particular, Arts. 5 and 8 thereof; Regulation (E U) 2015/755 of the European Parliament and 
of the Council (7) and, in particular, Arts. 3 and 5 thereof; Regulation (EU) 2015/1843 of the European 
Parliament and of the Council (8) and, in particular, Arts. 9 and 10 thereof; Regulation (EU) 2016/1035 of th e 
European Parliament and of the Council (9) and, in particular, Arts. 5(12) and (13), 6(5) -(8), and 12, 13 and 
14 thereof; Regulation (EC) No.  868/2004 of the European Parliament and of the Council (10) and, in 
particular, Arts. 7 and 8 thereof; Regulatio n (EU) No. 978/2012 of the European Parliament and of the Council 
(11) and, in particular, Art. 24 thereof; Commission Delegated Regulation (EU) No.  155/2013 (12) and, in 
particular, Art. 6 thereof; Commission Delegated Regulation (EU) No.  1083/2013 (13) a nd, in particular, Art. 5 
thereof; and Regulation (EU) 2015/476 of the European Parliament and of the Council (14) and, in particular, 
Arts. 1(2) and 2(2) thereof.  WT/TPR/S/395 • European Union  
 
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  3.82.   Most recently, in July 2019, the Commission implemented new rules to extend the reach of 
trade remedy laws to the continental shelf and exclusive economic zones of member States.130 This 
allows for the operationalization of the rules that were included in the 2018 modernization.131  
3.83.   The 2016 legislation pertaining to the injurious pricing of vessels, i.e. specific to ship -building 
purchase transactions, was put in place by regulation, but has not been applied, as it is linked to the 
entry into force of the OECD Shipbuilding Agreement, which has not occurred to date.132 Discussion s 
are ongoing at  the OECD .  
3.84.   The EU notified the WTO of the two main amendments to its trade remedy laws.133 
3.85.   During the review period there was a general decline in anti -dumping and anti -subsidy activity 
in the EU, as measured by initiations. The number of new investigations declined from 15 in 2016 
to 10 in 2018 and, over the same period, judicial cases declined  more markedly from 34 to 15 cases. 
Review investigations remained relatively constant (Chart 3.2).  
Chart 3.2 Overview of anti -dumping and anti -subsidy activity, 2016 -18 
 
Source:  Annual Reports from the Commission to the European Parliament and the Council on the EU's 
Anti-Dumping, Anti -Subsidy and Safeguard activities (2016 -18) and accompanying Commission Staff  
Working Documents. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157218.pdf , 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157776.PDF , and 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157811.pdf .  
                                                
130 European Commission, EU extends trade defence rules to continental shelf and exclusive eco nomic 
zones of Member States . Viewed at: http://trade.ec.europa.eu/doclib/press/index.cfm?id=2043 .  
131 Commission Implementing Regulation (EU) No. 2019/1131 of 2 July 2019 establishing  a customs tool 
in order to implement Article 14a of Regulation (EU) 2016/1036 of the European Parliament and of the Council 
and Article 24a of Regulation (EU) 2016/1037 of the European Parliament and of the Council. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=OJ:L:2019:179:FULL&from=EN .  
132 Regulation (EU) No. 2016/1035 of the European Parliament and of the Council of 8 June 2016 on 
protection against injurious pricing of vessels. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562254581936&uri=CELEX:32016R1035 .  
133 WTO do cuments G/ADP/N/1/EU/3/Suppl.2, 18 April 2017; G/SCM/N/1/EU/2/Suppl.2, 
23 January  2018; G/ADP/N/1/EU/3/Suppl.3, 2 July 2018; and G/SCM/N/1/EU/2/Suppl.3, 2 July 2018.  
15
11 1023 30
2434
20
15
020406080
2016 2017 2018New investigations initiated Review investigations initiated New judicial casesChart 3.[eu]  Overview of Anti -dumping and anti -subsidy activity, 2016 -18
Number
Annual Reports from the Commission to the European Parliament and the Council on the EU's Anti -Dumping, Anti -Subsidy 
and Safeguard activities (2016 -2018) and accompanying Commission Staff Working Documents. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157218.pdf, 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157776.PDF, and 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157811.pdf.Source:WT/TPR/S/395 • European Union  
 
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  3.86.   The overall number of mea sures in force remained relatively constant during the review period 
(Chart 3.3). This is due to the offsetting effect of lower initiations but relatively higher extensions 
from expiry reviews (see below). Also, the regional distribution of the measures re mained 
unchanged, with Asia, in particular China, accounting for the vast majority of both anti -dumping and 
anti-subsidy cases. There are very few measures concerning countries in Africa, the Americas, and 
the Middle East, while non -EU European countries a ccount for the second -largest group after Asia 
(Chart 3.3).  
Chart 3.3 Anti-dumping and anti -subsidy measures in forcea, by region, 2016 -18 
 
a Including extensions.  
b Non-EU European countries include: Belarus , the Russian Federation, Turkey, and Ukraine.  
Source:  Annual Reports from the Commission to the European Parliament and the Council on the EU's 
Anti-Dumping, Anti -Subsidy and Safeguard activities (2016 -18), and accompanying Commission 
Staff Working Documents. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157218.pdf , 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157776.PDF , and 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_1578 11.pdf .  
3.87.   There were a few shifts in the sectors impacted by anti -dumping and anti -subsidy 
investigations during the review period. There was a significant decline in investigations of the iron 
and steel sector, from 13 to zero between 2016 and 2017, with a  slight rebound to four in 2018. 
These shifts can likely be attributed to the surveillance and safeguard measures on steel that were 
in place, or were put in place, during the period. Another trend was a steady increase in initiations 
in the chemical and a llied product sector (Chart 3.4).  
3.88.   Pursuant to EU trade remedy rules, anti -dumping and anti -subsidy measures generally expire 
after five years unless an expiry review demonstrates the need for the continuation of the measure. 
The number of expiry review inv estigations in any given year depends, to a large extent, on the 
number of measures that were imposed five years before. In 2016, about 71% of the measures 
were confirmed and extended, whereas in 2018, this had increased to 100% (Chart 3.5).  
1 1 156 5102104991314
141
1
2 2
212 13 101 11
020406080100120140Chart 3.[eu]  Anti -dumping and anti -subsidy measures in force, by region, 2016 -18
Number of measures, including extensions (Cumulated) 
Middle East Africa Americas Europe AsiaAnti-dumping Anti-subsidy Anti-dumping Anti-subsidy Anti-dumping Anti-subsidy
2016 2017 2018
a Including extensions
b Non-EU European countries includes : Belarus,  Russian Federation, Turkey, and Ukraine.
Source:Annual Reports from the Commission to the European Parliament and the Council on the EU's Anti -Dumping, Anti -Subsidy and 
Safeguard activities (2016 -2018) and accompanying Commission Staff Working Documents. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157218.pdf,
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157776.PDF, and 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157811.pdf.a
bWT/TPR/S/395 • European Union  
 
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  Chart 3.4 Anti-dumping and anti -subsidy investigations initiated, by product sector, 
2016 -18 
 
Source:  Annual Reports from the Commission to the European Parliament and the Council on the EU's 
Anti-Dumping, Anti -Subsidy an d Safeguard activities (2016 -18), and accompanying Commission 
Staff Working Documents. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157218.pdf , 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157776.PDF , and 
http://trade.ec.europa.eu/d oclib/docs/2019/march/tradoc_157811.pdf .  
Chart 3.5 Outcome of expiry reviews concluded, 2016 -18 
 
Source:  Annual Reports from the Commission to the European Parliament and the Council on the EU's 
Anti-Dumping, Anti -Subsidy and Safeguard activities (2016 -18), and accompanying Commission 
Staff Working Documents. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/trad oc_157218.pdf , 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157776.PDF , and 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157811.pdf .  
3.1.6.2   Safeguards  
3.89.   Safeguards are part of the EU's framework on trade remedies, and the EU maintains rules for 
global safeguards pursuant to the WTO Agreement on Safeguards, as well as bilateral safeguard 
provisions in most of its bilateral FTAs. Historically, the EU has not  been a significant user to 
safeguards in the WTO framework, and has only initiated six safeguard cases since the inception of 
15 5113
4 21
3 1
0246810121416
2016 2017 2018Chemical and allied products Other mechanical engineering
Iron and steel Other metals
Wood OtherChart 3.  Anti -dumping and anti -subsidy investigations initiated by product sector, 2016 -18
Number of investigations initiated
Annual Reports from the Commission to the European Parliament and the Council on the EU's Anti -Dumping, Anti -Subsidy 
and Safeguard activities (2016 -2018) and accompanying Commission Staff Working Documents. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157218.pdf, 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157776.PDF, and 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157811.pdf.Source:
52
Confirmation of duty Termination and repeal of the measures161Chart 3.  Outcome of expiry reviews concluded, 2016 -18
Number
Source:2017 2016
Annual Reports from the Commission to the European Parliament and the Council on the EU's Anti -Dumping, Anti -Subsidy 
and Safeguard activities (2016 -2018) and accompanying Commission Staff Working Documents. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157218.pdf, 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157776.PDF, and 
http://trade.ec.europa.eu/doclib/docs/2019/march/tradoc_157811.pdf.72018WT/TPR/S/395 • European Union  
 
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  the WTO, with only three resulting in measures being put in place.134 Although it resumed the use 
of safeguards in 2018 with measur es put in place on steel products, it has not initiated any other 
cases since 2010.  
3.90.   The EU's basic rules for safeguards that were consolidated in 2015 have not changed, and 
they continue to form the basic framework for investigations and the imposition of safeguards by 
the Commission. Three basic laws apply, one for WTO Members, one for non -WTO Members, and 
one specific to textile products, as follows:  
• Regulation (EU) 2015/478 of the European Parliament and of the Council of 11  March  2015 
on common rules fo r imports (codification), i.e. imports from WTO Members;  
• Regulation (EU) 2015/755 of the European Parliament and of the Council of 29 April 2015 
on common rules for imports from certain third countries (recast), i.e. imports from 
non-WTO Members; and  
• Regulation (EU) 2015/936 of the European Parliament and of the Council of 9 June 2015 
on common rules for imports of textile products from certain third countries not covered 
by bilateral agreements, protocols or other arrangements, or by other specific Union 
import rules (recast), i.e. rules for textiles.  
3.91.   In 2019, the EU issued Regulation (EU) 2019/287 , the horizontal bilateral safeguard 
regulation, allowing for the implementation of bilateral safeguard clauses and other mechanisms  for 
the temporary withdrawal  of tariff preferences in certain  FTAs.135 The Regulation currently has three 
annexes for the FTAs with Singapore, Viet Nam, and Japan, thus operationalizing and establishing 
procedures for these bilateral safeguard clauses. It contains provisions on monitor ing, initiation of 
an investigation, prior surveillance measures, imposition of provisional and definitive safeguards, 
confidentiality, etc. In future, it is expected to be expanded to other FTAs.  This Regulation brings 
about a change in practice  and a rat ionalization  as, previously , the EU established separate 
arrangements for each FTA.136 
3.92.   In March 2018,  the EU initiated procedures for a safeguard investigation on 26 product 
categories of steel, pursuant to its safeguard rules in Regulations (EU) 2015/478 an d 
(EU) 2015/755137; the scope of the investigation was later expanded to 28 product categories. The 
Commission cited an increasing trend of imports of these product s, the situation of the EU steel 
industry , and the risk of trade diversion from US measures besides overcapacity and increased use 
of trade -restrictive practices  as the reasons for the initiation of the safeguard measure.138 Provisional 
safeguard measures were put in place in July 2018, and definitive measures in February 2019.139 
The implementing regulation was amended in November 2018 to remove several countries 
(Botswana, Cameroon, Eswatini, Fiji, Ghana, Côte d'Ivoire , Lesot ho, Mozambique, Namibia, and 
South Africa) from the scope of the measures.140 The final safeguard measures put in place involve 
                                                
134 It is noted that this figure does not include EU member States before they joined the EU . Some 
member States were more extensive users of safeguard measures prior to joining the EU. WTO. Viewed at: 
https://www.wto.org/english/tratop_e/safeg_e/SG -Initiat ionsByRepMember.pdf  and 
https://www.wto.org/english/tratop_e/safeg_e/SG -MeasuresByRepMember.pdf .  
135 Regulation (EU) No. 2019/287 of the European Parliament and of the C ouncil of 13 February 2019 
implementing bilateral safeguard clauses and other mechanisms allowing for the temporary withdrawal of 
preferences in certain trade agreements concluded between the European Union and third countries. Viewed 
at: https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1562174174671&uri=CELEX:32019R0287 .  
136 See previous Review, WTO document WT/TPR/S/357/Rev.1, 13 October 2017, para.  3.71. 
137 Commission Notice No. 2018/C 111/10, Notice of initiation of a safeguard investigation concerning 
imports of steel products. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=uriserv:OJ.C_.2018.111.01.0029.01.ENG&toc=OJ:C:2018:111:TOC .  
138 Commission Implementing Regulation (EU) No. 2018/1013 of 17 July 2018 imposing provisional 
safeguard measures with regard to i mports of certain steel products. Viewed at: https://eur -
lex.europa.eu/eli/reg_impl/2018/1013/oj . 
139 Commission Implementing Regulation (EU) No. 2019/159 of 31 January 2019 imposing definitive 
safeguard measures against imports of certain steel products. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562174174671&uri=CELEX:32019R0159 ; and Commission Implementing Regulation 
(EU) No. 2018/1013 of 17 July 2018 imposing provisional safeguard measures with regard to imports of certain 
steel p roducts. Viewed at: https://eur -lex.europa.eu/eli/reg_impl/2018/1013/oj . 
140 Commission Implementing Regulation (EU) No. 2018/1712 of 13 November 2018 amending 
Implementing Regulation (EU) 2 018/1013 imposing provisional safeguard measures with regard to imports of WT/TPR/S/395 • European Union  
 
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  26 categories of steel products whereby TRQs have been established based on the level of imports 
over the last three -year period ( 2015-17) plus 5%. In some cases, the TRQs were specifically 
allocated to a country, i.e. based on historical imports; otherwise, a general TRQ is allocated on a 
first-come -first-served basis. An additional duty rate of 25% is applicable for out -of-quota im ports. 
The safeguard measure is expected to be in place for  slightly less than  three years ; it is set to expire 
on 30 June 2021.  This measure was notified to the WTO.141 
3.93.   As noted in the previous Review, the EU imposed steel surveillance measures which contin ued 
to be in place during the review period, pursuant to Commission Implementing Regulation (EU) 
2016/670.142 The Regulation was amended in 2017 by Commission Implementing Regulation (EU) 
2017/1092 , in order to amend the product coverage, clarify the procedu res for the surveillance 
document, exclude small shipments whose weight does not exceed 5,000 kg classified in HS heading 
7318, and to encourage the use of electronic versions of the surveillance document.143 For the 
products covered by the safeguard measure s, the surveillance measures were suspended.  
3.94.   Similar to the surveillance measure that was put in place for steel products in 2016, the EU 
invoked a surveillance measure on certain aluminium products144 originating in certain 
third countries, from April 2018 until May 2020.145 The Commission Implementing Regulation cites 
"recent trends in imports of aluminium products, the current excess capacity, the current vulnerable 
situation of the Union industry and the potential trade diversion  triggered by the United Sta tes 
measures " as the reasons for imposing such a measure. Thus, pursuant to the EU's safeguard rules 
as set out in Regulations (EU) 2015/478 and (EU) 2015/755, certain aluminium products whose net 
weight exceeds 2 ,500 kg  require surveillance documents issu ed by the competent authorities before 
the product can be put in free circulation.  
3.95.   In addition to the notification of the safeguard measure noted above on steel products, the 
EU made a notification under Article 12.5 of the Agreement on Safeguards to the Council for Trade 
in Goods (CTG) of a proposed suspension of concessions and other obligations referred to in 
paragraph 2 of Article 8 (Section  3.1.7).146 In 2019, the EU imposed a safeguard measure under the 
GSP for Indica rice from Cambodia and Myanmar (Se ction 2).  The agricultural special safeguard is 
discussed in Section 4.1.1.2.3.  
3.1.7   Other measures affecting imports  
3.96.   The EU continues to maintain a number of restrictive measures or "sanctions ", pursuant to 
the objectives of  the EU Common Foreign and Security Policy (CFSP) and per  UN Security Council 
Resolutions. The EU 's policy  is that sanctions are one of the tools used to promote its objectives of 
peace, democracy and respect for the rule of law, human rights and international  law. EU  sanctions 
are put in place after a decision by the CFSP Council, in unanimity; UN measures are transposed 
into EU legislation, ensuring uniform application throughout the EU territory . Application  and 
enforcement of EU sanctions fall under the res ponsibility of  the member States . Import or export 
bans are identified in the TARIC , and are enforced at the border by the customs authorities .  
                                                
certain steel products. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/ TXT/?qid=1562174174671&uri=CELEX:32018R1712 .  
141 WTO documents G/SG/N/8/EU/1, 4 January 2018; G/SG/N/10/EU/1, 4 January 2019; 
G/SG/N/11/EU/1/Suppl.1, 4 January 2019; G/SG/N/8/EU/1/Suppl.1, 7 February 2019; 
G/SG/N/10/EU/1/Suppl.1 7 February 2019; G/SG/N/11/E U/1/Suppl.2, 7 February 2019; 
G/SG/N/10/EU/1/Suppl.2, 21 May 2019; G/SG/N/7/EU/1, 18 July 2018; and G/SG/N/11/EU/1, 18  July 2018.  
142 Commission Implementing Regulation (EU) No. 2016/670 of 28 April 2016 introducing prior Union 
surveillance of imports of certain iron and steel products originating in certain third countries. Viewed at: 
https://eur -lex.europa.eu/legal -content/GA/TXT/?uri=CELEX:32016R0670 .  
143 Commission Implementing Regulation (EU) No. 2017/1092 of 20 June 2017 amending Implementing 
Regulation (EU) 2016/670 introducing prior Union surveill ance of imports of certain iron and steel products 
originating in certain third countries . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri =OJ:L:2017:158:FULL&from=EN .  
144 HS codes 7601, 7604, 7605, 7606, 7607, 7608, 7609, and 7616.99.  
145 The regulation exempts EEA countries. Commission Implementing Regulation (EU) 2018/640 of 
25 April 2018 introducing prior Union surveillance of imports of cer tain aluminium products originating in 
certain third countries. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2018/april/tradoc_156832. products.surveillance.en.L106 -2018.pdf .  
146 WTO documents G/L/1237 and G/SG/N/12/EU/1, 18 May 2018.  WT/TPR/S/395 • European Union  
 
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  3.97.   Up-to-date information on sanctions  adopted by the EU, including sanctions regimes imposed 
by the UN Security C ouncil and implemented by the EU,  can be found on the EU's "Sanction Map" 
webpage, which shows the measures by country or by type of restriction.147 The measures take 
many forms, such as the prohibited export of certain goods, travel restrictions, freezing o f assets, 
restrictions on the import or brokering of specific goods, restrictions on financial services. As at July 
2019,  the EU had 44 sanctions regimes in place, both geographical (targeting behaviour occurring 
in a particular country) and thematic (targ eting behaviour unrelated to a specific country, such as 
terrorism, chemical attacks or cyber attacks) .  
3.98.   In May and June 2018, the EU issued two regulations on certain commercial policy measures 
concerning certain products originating in the United States.148 The first refers to certain tariff 
increases on imports into the United States of certain steel and aluminium products, and the 
EU's rights regarding the application and enforcement of international trade rules . The effective date 
of the tariff increases  for the EU was initially 22 March 2018, but was subsequently deferred to 
1 May 2018 and then further deferred to 1 June 2018, whereby it was implemented and continues 
with unlimited duration . The regulation states that "[c] onsultations between the United States and 
the Union as envisaged in Articles 8 and 12.3 of the WTO Agreement on Safeguards did not reach 
any satisfactory solution ".149 In response to the US imposition of measures on steel and aluminium 
products, the second regulation explains that the EU gave written notice to the WTO CTG150 in order 
to suspend certain concessions under GATT 1994 with respect to the United States. The list of 
products whereby the EU initially imposed additional duties is set out in Annex I of the first 
regulation, which was replaced by Annex I in the second r egulation. Thus, the EU has in place 
additional duties ranging from 10% to 25% on 182 tariff lines on products from the United States, 
in a variety of sectors, i.e. agriculture, steel, aluminium, pleasure boats, etc. The regulations 
envisage that further a dditional duties may be put in place on another list of products (Annex II) as 
of 23 March 2021 or upon determination of WTO inconsistency of the US measure s. 
3.99.   Another piece of EU legislation on the matter is Regulation (EC) 2271/96 (the "Blocking 
Statute") , as a measure to counter third -country legislation preventing trade. The Regulation has 
been in force since 1996 and was amended in 2008. Among others, it prohibits the recognition in 
the EU of any foreign decision based on the foreign acts set out in its  Annex, and allows EU persons 
to recover losses suffered as a result of those acts and actions.  
3.2  Measures Directly Affecting Exports  
3.2.1   Customs procedures and requirements  
3.100.   When goods leave the EU customs' territory, they must follow procedures for export as 
outlined in the Union Customs Code (UCC). The basic rules that define the applicable procedures 
and formalities are laid down in Title VIII on Goods taken out of the customs territory of the Union.151 
Prior to exportation, the exporter is required, in most cir cumstances, to file a pre -departure 
declaration with the customs authorities. This declaration can take the form of a customs declaration, 
a re-export declaration, or an exit summary declaration. When goods are to leave the customs 
territory, they are subj ect to customs supervision, and may be subject to customs controls. Under 
certain conditions, the customs authorities may determine the route to be taken and/or set certain 
time parameters. If an export declaration or re -export declaration was not filed as  part of the 
pre-departure process, an exit summary declaration must be filed at the customs office of exit. The 
                                                
147 EU Sanctions Map. Viewed at: https://sanctionsmap.eu/#/main . 
148 Commission Implementing Regulation (EU) No. 2018/724 of 16 May 2018 on certain commercial 
policy measures concerning certain products originating in the United States of America. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1562567645097&uri=CELEX:32018R0724 ; and 
Commission Implementing Regulation (EU) No. 2018/886 of 20 June 2018 on certain commercial policy 
measures concerning certain p roducts originating in the United States of America and amending Implementing 
Regulation (EU) 2018/724. Viewed at: https://eur -lex.europa.eu/legal -
conten t/EN/TXT/?qid=1562567645097&uri=CELEX:32018R0886 .  
149 Commission Implementing Regulation (EU) No. 2018/724 of 16 May 2018 on certain commercial 
policy measures concerning certain products originating in the United States of America. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1562567645097&uri=CELEX:32018R0724 . 
150 WTO documents G/L/1237 and G/SG/N/12/EU/1, 18 May 2018.  
151 Regulation (EU) No . 952/2013 of the European Parliament and of the Council of 9  October 2013 
laying down the Union Customs Code. Viewed at: https://eur -lex.europa.eu/eli/reg/2013/952/oj .  WT/TPR/S/395 • European Union  
 
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  UCC also contains provisions on the re -exportation of non -Union goods. This requires exporters to 
submit a re -export declaration to the appropr iate customs authorities upon exportation.  
3.101.   With the move towards a paperless environment and the gradual implementation of the 
customs electronic systems pursuant to the UCC, the EU has gradually implemented new electronic 
systems for exports. It  implement s the Automated Export System  (AES)  that has distributed 
information technology ( IT) architecture and is developed by all the member States based on 
common technical specifications issued by DG TAXUD.  Technical System Specifications are under 
preparation a nd are planned to be finali zed by the end of 2019. Regarding the UCC Work Programme 
and the Multi-annual Strategic Plan , a deployment time -window will be available for EU member 
States to be able to implement the AES functionalities between March 2021 and December 2023 in 
a production environment.  The REX system was implemented as of 2017, to aid in trade and origin 
requirements under the GSP (Section 3.1.1). However, to date, the Export Control System (ECS)  is 
still used as the main electronic system for t he filing and control of customs export procedures  until 
the deployment of the AES, which will  be aligned with UCC requirements from December 2023 in all 
the member States . 
3.102.   As noted in Section 3.1.1, there were some changes to the definition of exporter an d 
registered exporter in the UCC legislation during the period. Changes were made to allow greater 
flexibility to business es, regarding  the person who may act as exporter , so that one individual does 
not have to meet all the criterion. Clarifications were also made for registered exporters, to make it 
easier for them to make origin declarations for preferential trade agreements.152 
3.2.2   Taxes, charges, and levies  
3.103.   The EU does not currently impose any taxes, charges or levies on exports, although the UCC 
contains pr ovisions and procedures for the collection of export duties, similar to those for import 
duties.  
3.2.3   Export prohibitions, restrictions, and licensing  
3.2.3.1   Prohibitions, restrictions, and licensing  
3.104.   The EU maintains export prohibitions or restrictions on about 11 ca tegories of  products 
(Table  3.9). Many of these are pursuant to international agreements or arrangements, e.g. CITES, 
and the Montreal Protocol, while others are EU measures. There were several developments during 
the review period on products subject to e xport controls, but most are also covered by import 
controls; these changes are examined in Section 3.1.5.  
3.105.   A new regulation on mercury and mercury products entered into force during the period, 
replacing the previous regulation from 2008. The new regulation ( Regulation (EU) 2017/852 ) 
expands the scope of the export prohibition to more mercury products, and also includes new 
restrictions on imports and manufacture (Section 3.1.5).153 
3.106.   The regulations on c ertain goods which could be used for capital punishment, torture or 
other cruel, inhuman or degrading treatment or punishment  were replaced and codified into 
Regulation 2019/125.154  
                                                
152 Commission Delegated R egulation (EU) No. 2018/1063 of 16 May 2018 amending and correcting 
Delegated Regulation (EU) 2015/2446 supplementing Regulation (EU) No. 952/2013 of the European 
Parliament and of the Council as regards detailed rules concerning certain provisions of the Union Customs 
Code. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562827757662&uri=CELEX:32018R1063 .  
153 Regulation (EU) No. 2017/852 of  the European Parliament and of the Council of 17 May 2017 on 
mercury, and repealing Regulation (EC) No. 1102/2008. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017R0852&rid=1 .  
154 Regulation (EU) No. 2019/125 of the European Parliament and of the Council of 16 January 2019 
concerning trade in certain goods which could be used for capital punishment, torture or other cruel, inhuman 
or degrading treatment or punishment. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=uriserv:OJ.L_.2019.030.01.0001.01.ENG . WT/TPR/S/395 • European Union  
 
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  3.107.   Regulation (EC) No. 1013/2006  lays down rules on the export of waste from the EU. They 
are based on the provisio ns of the Basel Convention for the Control of Trans boundary  Movements of 
Hazardous Waste and their Disposal , but are stricter in a number of instances. At the 14th Conference 
of the Parties of the Basel Convention in May 2019, new rules were adopted with r egard to 
international trade in plastic waste, which will enter into force in 2021. For the EU, this means that, 
from 2021, the export of plastic waste to non -OECD countries will be banned, except for plastic 
wastes which are easy to recycle.  
3.108.   Pursuant to a Commission Guidance document155, the EU has given guidance to member 
States to  not issue re -export certificates for raw ivory, except in exceptional cases , since 1  July 2017. 
This temporary suspension is in response to a surge in elephant poaching, a signi ficant increase in 
the legal trade in ivory from the EU in recent years, and various EU initiatives taken against wildlife 
trafficking  pursuant to CITES. The Guidance document also puts in place more stringent measures 
on intra -EU trade in ivory.  
3.109.   During th e review period, the EU also had in place an export licence regime for sugar 
(Section  4.1.1.2.2), which ended in 2017.156 It is noted that, in addition to sanctions on imports 
(Section 3.1.7), the EU also has sanctions on exports that are outlined in its Sanction Map 
webpage .157 In addition, EU exporters may also face certain sanctions in other countries.  
Table 3.9 Prohibitions , restrictions or licensing on exports, 201 9 
Product  Measure  Rationale  Legislation  
Subst ances that deplete 
the ozone layer  Prohibition/restriction  Montreal Protocol  Regulation (EC) 
No. 1005/2009  
Certain hazardous 
chemicals  Prohibition/restriction  Rotterdam Convention 
on the Prior Informed 
Consent Procedure for 
Certain Hazardous  
Chemicals and Pesticides 
in International Trade  
Stockholm Convention 
on Persistent Organic 
Pollutants  Regulation (EU) 
No. 649/2012  
Certain animal and plant 
species  Prohibition/restriction  CITES  Council Regulation (EC) 
No. 338/97; and 
Commission Regulation  
(EC) No. 865/2006  
Mercury and mercury 
products  Prohibited  Minamata Convention on 
Mercury  Regulation (EU)  
No. 2017/852  
Certain goods which 
could be used for capital 
punishment, torture or 
other cruel, inhuman or 
degrading treatment or 
punishment  Prohibition/licensing  Protection of human life 
or health, protection of 
public morals  Regulation (EU)  
No. 2019/125   
                                                
155 Commission Notice No. 2017/C 154/06. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1561989389633&uri=CELEX:52017XC0517(01) .  
156 Commiss ion Implementing Regulation (EU) No. 2017/545 of 22 March 2017 fixing an acceptance 
percentage for the issuing of export licences, rejecting export -licence applications and suspending the  lodging  
of export -licence applications for out -of-quota sugar. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562235075533&uri=CELEX:32017R0545 .  
157 EU Sanctions Map. Viewed at: https://sanctionsmap.eu/#/main . WT/TPR/S/395 • European Union  
 
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  Product  Measure  Rationale  Legislation  
Waste  Prohibition/restriction  Basel Convention for the 
Control of 
Trans boundary  
Movements of Hazardous 
Waste and their Disposal  
OECD Decision on the 
control of transboundary 
movements of wastes 
destined for recovery 
operations  Regulation (EC) 
No. 1013/2006 and its 
subsequent 
amendments ; and 
Regulation (EC) 
No. 1418/2007  
Rough diamon ds Licensing  Kimberley Process 
certification scheme for 
rough diamonds  Council Regulation (EC) 
No. 2368/2002  
Certain cultural goods  Restriction  Protection of treasures 
of artistic, historic or 
archaeological value  Council Regulation (EC) 
No. 116/2009  
Bluefin tuna  Prohibition/restriction  International Convention 
for the  Conservation of 
Atlantic Tunas  Regulation (EU) 
No. 640/2010  
Fish of vessels from 
Cambodia and Guinea  Prohibition  Protection of the 
environment  Regulation (EC) 
No. 1005/2008; and 
Council Implementing 
Decision of 24  March 
2014 
Source:  WTO document G/MA/QR/N/EU/4; TARIC; and European Commission, Tariff rate quotas . Viewed at: 
https://ec.europa.eu/agriculture/tariff -rate-quotas -trqs_en .  
3.2.3.2   Export controls  
3.110.   The EU continues to regulate the export of certain products, pursuant to its export control 
legislation on dual -use goods.158 This regulation, from 2009, and its amendments implement controls 
on the products as identified in various international agreements, i.e. the Wassenaar Arrangement, 
the Missile Technology Control Regime (MTCR), the Nuclear Suppliers' Gr oup (NSG), the Australia 
Group , UN Security Council Resolution 1540, the Nuclear Non -Proliferation Treaty, the Biological 
Weapons Convention, and the Chemical Weapons Convention (CWC) . The regulation sets out the 
customs procedures, control measures, and o ther provisions, and products covered are listed in its 
annexes. According to Commission estimates, exports of controlled dual -use products amounted to 
about 2.3% of total EU exports159 in 2017.  
3.111.   The EU's export control regulations set out a common list of e xport control rules applied on 
the EU common list of dual -use items; member States may set out more stringent controls due to 
public security or human rights issues.160 The EU common list of dual -use goods are categorized in 
ten sectors, and their numbers ha ve varied over the period, from 1,892 items in 2016 to 1,846  in 
2018.161 EU export controls are administered through four basic types of authorizations: EU General 
Export Authorisations (EUGEAs), National General Export Authorisations (NGEAs), global licence s, 
and individual licences. The regulation also sets out specific rules for brokering transactions and 
goods transiting through the EU.  
                                                
158 Council Regulation (EC) No. 428/2009 of 5  May 2009 setting up a Community regime for the control 
of exports, transfer, brokering and transit of dual -use items. Viewed at: https://eur -lex.europa.eu/legal -
content/GA/TXT/?uri=CELEX:32009R0428 . Dual -use goods are defined as items, including software and 
technology, which can be used for both civil and military purp oses, and include all goods which can be used for 
both non -explosive uses and assisting in any way in the manufacture of nuclear weapons or other nuclear 
explosive devices.  
159 Extra -EU exports.  
160 A list of national measures is published in the Official Jou rnal. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2016/august/tradoc_154880.pdf .  
161 The ten categories are: nuclear materials, facilities, and equipment; special mater ials and related 
equipment; materials processing; electronics; computers; telecommunications and "information security"; 
sensors and lasers; navigation and avionics; marine; and aerospace and propulsion.  WT/TPR/S/395 • European Union  
 
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  3.112.   The developments during the review period include two amendments to the regulation, in 
2017 and 2018, basically to updat e the annexes reflecting changes in the international 
arrangements, but also requiring consequential changes to the Union and National General Export 
Authorisation  provision s.162 There was also further progress towards the development of the 
Dual-use e -Syste m (DUeS), an electronic system from the Commission to support the exchange of 
information between member State export control authorities and the Commission, in particular on 
enhanced functionality and better online management. Following a licensing feasib ility study in 2018, 
a pilot project was launched in 2019 to develop an electronic licensing system that can be deployed 
in member States where appropriate. The system's deployment is expected to start in early 2020 .  
3.113.   In 2013, the Commission launched procedures for the review of the export control regime, 
that resulted in a legislative proposal in 2016 to upgrade the existing rules in order to face new 
challenges. The approach taken by the Commission in its proposal was  to modernize and upgrade 
the existing framework, in particular focusing on cyber -surveillance technologies and human rights  
aspects.163 Specifically, it would require authorization for exports of specific cyber -surveillance 
technologies , even if exported el ectronically; modernize existing control provisions, including for 
intangible technology transfers; tackle illicit trade through certain controls, such as 
anti-circumvention; harmonize licensing processes; and improve transparency and outreach. The 
Parliam ent adopted its position on the proposal in January 2018, while the Council agreed on its 
position in June 2019 ; thus, trilogue discussions were underway  with a view to completing the 
legislative process a nd agreeing on a new regulation.  
3.114.   The EU adopted a regulation in 2019 on granting an EUGEA to the United Kingdom of 
Great  Britain and Northern Ireland, as they are an important destination for dual -use items and are 
party to the relevant international treaties. The regulation is in force but it will only b e applied in 
case of withdrawal from the EU without an agreement, and from the day after the Treaties cease to 
apply to the United Kingdom pursuant to Article 50(3) of the TFEU.164 
3.115.   In December 2017, the Commission adopted a Report on the evaluation of the ap plication 
of Regulation (EU) No. 258/2012 on the import and export of firearms. This Report concluded that 
it is necessary to identify measures and actions which strengthen the system of export authorizations 
around firearms, to control the conditions for legal trade and thus better fight illegal firearm 
trafficking. In April 2018, the Commission adopted a Recommendation which calls for the 
strengthening of the EU rules to improve the traceability and the security of export and import 
control procedures of firearms, and the cooperation between authorities in the fight against firearms 
trafficking.165 Preparatory works were ongoing to assess future policy options for a possible 
modernization of this Regulation. In June 2018, the Commission proposed a new EU str ategy against 
illicit firearms, small arms and light weapons (SALW) and their ammunition , with a number of 
suggested actions.166 
3.116.   The volume and value of EU controlled dual -use exports remained relatively steady at about 
45,000 applications accounting for abo ut 45 billion euros during the period, but there were some 
                                                
162 Commission Delegated Regulation (EU) No. 2017/2268 of 26 September 2017 amending Council 
Regulation (EC) No. 428/2009 setting up a Community regime for the control of exports, transfer, brokering and 
transit of dual -use items. Viewed at: https://eur -lex.europa.eu/eli/reg_del/2017/2268/oj ; and Commission 
Delegated Regulation (EU) No. 2018/1922 of 10 October 2018 amending Council Regulation (EC) No. 428/2009 
setting up a Community regime for t he control of exports, transfer, brokering and transit of dual -use items. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1562530564583&ur i=CELEX:32018R1922 . 
163 Proposal for a regulation of the European Parliament and of the Council setting up a Union regime for 
the control of exports, transfer, brokering, technical assistance and transit of dual -use items. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?qid=1476175365847&uri=CELEX:52016PC0616 .  
164 Regulation (EU) 2019/496 of the European Parliament and of the Council of 25 March 2 019 amending 
Council Regulation (EC) No. 428/2009 by granting a Union general export authorisation for the export of 
certain dual -use items from the Union to the United Kingdom. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562541197875&uri=CELEX:32019R0496 .  
165 European Commission, Commission Recommendation of 17 April 2018 on immediate steps to 
improve security of export, import and tran sit measures for firearms, their parts and essential components and 
ammunition . Viewed at: https://ec.europa.eu/home -affairs/sites/homeaffairs/files/what -we-
do/policies/european -agenda -security/20180417_commission -recommendation -immediate -steps -improve -
security -firearms -ammunition_en.pdf .  
166 EUR-Lex, Elements towards an EU Strategy against illicit Firearms, Small Arms & Light Weapons and 
their Ammunition "Securing Arms, Protecting Citizens" . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562235075533&uri=CELEX:52018JC0017 . WT/TPR/S/395 • European Union  
 
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  fluctuations (Table 3.10). The number of denials remains relatively low, at about 1.5% of 
applications. The majority of EU exports of dual -use goods were destined for the United States, 
followed by  China, and Switzerland. Most authorizations were obtained through individual licenses 
(Table 3.10).  
Table 3.10 Controlled dual -use exports, 2015 -17  
 2015  2016  2017  
Controlled export volume (number)  
Applications  45,994  44,450  48,243  
Authorizations  27,479  27,043  28,633  
Denials  640 690 631 
Controlled export value (EUR billion)  
Applications  44 45.7 50.2 
Authorizations  33.7 33.1 36.7 
Top three destinations  United States ; China; 
Switzerland  United States ; China; 
Switzerland  United States ; China; 
Switzerland  
Top three licen ce types 
(%) Individual licen ce 
(75%); EUGEAs (13%); 
NGEAs  (4%) Individual licen ce 
(74%); EUGEAs (14%); 
NGEAs  (4%)  Individual licen ce 
(74%); EUGEAs (14%); 
NGEA s (3%)  
EUGEAs  EU General Export Authorisations.  
NGEAs  National General Export Authorisations.  
Source:  Reports from the Commi ssion to the European Parliament and the Council on the implementation of 
Regulation (EC) No . 428/2009 setting up a Community regime for the control of exports, transfer, 
brokering and transit of dual -use items , 2017 -18; and information provided by the authorities. 
Viewed at:  https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1562520757452&uri=CELEX:52018DC0852  and https://eur -
lex.europa.eu/legal -content/EN/TXT/?qid=1562522859621&uri=CELEX:52017DC0679 .  
3.2.4   Export support and promotion  
3.117.   Export or trade promotion activitie s are generally within the realms of the member States. 
The Commission, however, provides information for exporters through its Market Access 
Database .167 It provides basic trade information by product and country. For example, information 
on tariffs, other taxes, trade flows, procedures and documentation, trade barriers, food safety rules, 
and rules of origin is available. The Commission also works closely with EU member States and 
stakeholders in their Market Access Partnership , to identify and overcome tra de barriers in other 
markets, the results of which are summari zed in the annual Report on Trade and Investment 
Barriers .168 The EU's export support activities are outlined in Section 3.2.5.  
3.118.   Trade, and often investment, promotion activities are typically con ducted by government 
agencies in member States, at national or sub -national level (Table 3.11). The roles of these 
agencies can be quite diverse but most are involved in organizing trade fair participation, identifying 
new market possibilities, highlightin g certain sectors of the economy, providing information on 
export rules, providing information on aid or incentives, and arranging networks and contacts. The 
EU-wide organization, European Trade Promotion Organisations (ETPO), coordinates the promotional 
activities of the national bodies.169 
                                                
167 European Commission, Exporting from the EU – what you need to k now. Viewed at: 
https://madb.europa.eu/madb/ .  
168 European Commission, Report from the Commission to the Parliament and the Council on Trade and 
Investment Barriers . Viewed at: http://trade.ec.europa.eu/doclib/docs/2019/june/tradoc_157929.pdf . 
169 ETPO, Introducing ETPO . Viewed at: https://www.europe -tpo.com/ .  WT/TPR/S/395 • European Union  
 
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  Table 3.11 Export promotion authorities, 2019  
Member State  Organi zation  Link 
Austria  WKO https://www.wko.at/   
Belgium  Flanders Trade; Bruxelles Invest & 
Export; Wallonia Export and Investment  https://www.awex.be/fr -
BE/L'exportpratique/conseil -
export/Introduction/Pages/Int roduction.aspx ; 
http://invest -export.brussels/fr_FR/nos -
services ; 
http://www.flandersinvestmentandtrade.com/
export/internationaal   
Bulgaria  Bulgarian Small and Medium 
Enterprises Promotion Agency 
(BSMEPA)  http://www.sme.government.bg/  
Croatia  Izvozni portal  https://izvoz.gov.hr/   
Cyprus  Trade Service  http://www.mcit.gov.cy/mcit/trade/ts.nsf/ind
ex_gr/index_gr?OpenDocument   
Czech Republic  Czech Trade  https://www.czechtrade.cz/sluzby   
Denmark  The Trade Council  https://thetradecouncil.dk/   
Estonia  Enterprise Estonia  https://www.eas.ee/   
Finland  Business Finland  https://www.businessfinland.fi/en/do -
business -with-finland/home/   
France  Business France  http://export.businessfrance.fr/default.html   
Germany  Germany Trade & Invest  http://www.gtai.de/GTAI/Navigation/DE/welc
ome#trade   
Greece  Enterprise Greece  https://www.enterprisegreece.gov.gr   
Hungary  Hungaria n National Trading House; 
Hungarian Investment Promotion 
Agency  http://www.tradehouse.hu/ ; 
http://www.hipa.hu/   
Ireland  Enterprise Ireland  https://www.enterprise -
ireland.com/en/Export -Assistance/   
Italy Italian Trade & Investment Agency  https://www.ice.it/it  
Latvia  LIIA http://eksports.liaa.gov.lv/   
Lithuania  Versli Lietuva  http://www.verslilietuva.lt/lt/eksportas   
Luxembourg  Luxembourg Trade & Invest  https://www.tradeand invest.lu   
Malta  Malta Enterprise  http://www.maltaenterprise.com/support/trad
e-promotion   
Netherlands  Netherlands Enterprise Agency  http://www.rvo.nl/onderwerpen/internationaal
-ondernemen   
Poland  Polish Investment & Trade Agency  http://www.paih.gov.pl/   
Portugal  aicep Portuga l Global  http://www.portugalglobal.pt/PT/Internacional
izar/Paginas/MenuInternacionalizar.aspx   
Romania  Romania Trade & Investment  http://www.ghidul.ro/traderom/produse -
servicii   
Slovak Rep ublic SARIO Slovak Investment and Trade 
Development Agency  http://www.sa rio.sk/sk/exportujte -do-
zahranicia   
Slovenia  SPIRIT Slovenija  http://www.izvoznookno.si/   
Spain  ICEX http://www.icex.es/icex/es/navegacion -
principal/exportadores -habituales/index.html   
Sweden  Business Sweden - The Trade & Invest 
Council  http://www.business -
sweden.se/Export/tjanster/   
United Kingdom  Exporting is GREAT  https://www. great.gov.uk/?utm_source=govu
k&utm_medium=homepagelink&utm_campaig
n=EIG   
Source:  European Commission, Questions about Trade? . Viewed at: http://ec.europa.eu/trade/trade -policy-
and-you/contacts/#_exports . 
3.2.5   Export finance, insurance, and guarantees  
3.119.   Most EU member States have some form of officially -supported export financing, credits, 
insurance or guarantees. These are provided by the member States through designated 
export -credit agencies, financial institutions, export -import (EXIM) banks, or similar (Table A3.3). 
As such, 26 EU member States offer export credits or guarantees through approximately 30 entities, 
although there are fluctuations year -to-year.170 While the operatio n and delivery of these products 
                                                
170 The number of entities varies from year to year. For example, Bulgaria, Croatia and Romania had 
export -credit support activities in 2013, 2015 and 2016; and Romania in 2017. No information was available 
on Cyprus and Malta. This includes medium -, long - and short -term support (Table A3.3).  WT/TPR/S/395 • European Union  
 
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  is at the national level, the EU has a number of provisions at the supranational level, to harmonize 
certain aspects or create a level playing field; it also plays a coordinating role on policy.  
3.120.   The Council of the European  Union has an Exports Credit Group that was established in 1960 
to coordinate financing, guarantees, insurance and reinsurance of export transactions  among 
EU member States.171 The Group formulates EU export -credit policy, harmonizes measures on 
export credi ts, and works with the OECD on related legislative matters . In addition, the Policy 
Coordination Group for Credit Insurance, Credit Guarantees and Financial Credits is another body , 
mainly for coordination purposes.172 For example, it discusses and coordinat es the EU positions on 
official export -credit support policy matters in the meetings of the Participants to the OECD 
Arrangement on Officially Supported Export Credits , but does not decide on specific export -credit 
support operations, as that is the purview of the member States for their respective agencies.  
3.121.   The EU has several provisions on export credit, insurance or guarantee instruments but does 
not have any all -encompassing legislation, except on short -term official export -credit support, 
i.e. with a repayment time of up to two years. The various instruments that impose rules in this area 
are outlined in Table 3.12. Regulation (EU) No . 1233/2011  provides certain guidelines in the field of 
officially -suppor ted export credits  for EU member States. It basically has two functions: it legally 
incorporates the Arrangement on Officially Supported Export Credits (the Arrangement) of the OECD  
into EU law, and it provides for annual reporting of export -credit activit ies to the Commission in 
order to increase transparency.173 The Arrangement, established in 1978, has been described as a 
gentleman's agreement among a number of OECD member States, that aims to provide a level 
playing field on export credits, and works towa rds the elimination of subsidies and trade distortions 
for officially -supported credits. The transparency aspect was incorporated into the Regulation in 
2011 but it did not become operational until later, with data in its annual reports for 2015 and 2016 
becoming available in 2018. Furthermore, the Regulation was amended once during the review 
period, to replace Annex II, which now contains the updated text of the Arrangement.174 
3.122.   The Communication from the Commission to the member States on the application of  Articles 
107 and 108 of the TFEU to short -term export -credit (STEC) insurance provides guidelines for state 
insurers which are providing cover for STECs . The Communication provides for a list of so called 
"marketable risk countries ", and lays down conditi ons that need to be fulfilled for insurance of STEC 
risks with respect to those countries , as well for insurance of so called " temporarily non marketable 
risks".175 In 2018, the Commission prolonged the Communication without substantial changes until 
the end  of 2020 , and concluded that, as regards Greece, STEC risks remain temporarily 
non-marketable until the end of 2019. In January 2019 , the Commission launched the evaluation of 
the Communication in accordance  with its Better Regulation Guidelines. The evalu ation will be 
operated under the overall "fitness check " of a number of state aid rules , with the purpose of 
identifying whether it can be further prolonged or possibly updated. The evaluation is ongoing , with 
expected results in early  2020.  
                                                
171 European Council, Exports Credit Group . Viewed at: https://www.consilium.europa.eu/en/council -
eu/preparatory -bodies/ exports -credit -group/ . 
172 Established pursuant to OJ 66, 27 October 1960.  
173 Regulation (EU) No. 1233/2011 of the European Parliament and of the Council of 16  November 2011 
on the application of certain guidelines in the field of officially supported export credits and repealing Council 
Decisions 2001/76/EC and 2001/77/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32011R1233 ; and OECD, Arrangement on Official Supported Export Credits . 
Viewed at: https://w ww.oecd.org/trade/topics/export -credits/arrangement -and-sector -understandings/ . 
174 Commission Delegated Regulation (EU) 2018/179 of 25 September 2017 amending Regulation (EU) 
No. 1233/2011 of the European Parliament and of the Council on the application of certain guidelines in the 
field of officially supported export credits. Viewed at: https://eur -lex.europa.eu/legal -
content/en/ALL/?uri=CELEX:32018R0179 . Furthermore, the E U has been in negotiations since 2012 in the 
OECD International Working Group of Export Credits for a successor agreement to the OECD Arrangement.  
175 EUR-Lex, Communication from the Commission to the Member States on the application of Articles 
107 and 108 of the Treaty on the Functioning of the European Union to short -term export -credit insurance . 
Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=uriserv:OJ.C_.2012.392.01.0001.01.ENG&toc=OJ:C:2012:392:TOC#ntr1 -
C_2012392EN.01000101 -E0001 . WT/TPR/S/395 • European Union  
 
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  3.123.   In a related development, EU financial institutions subject to the European capital 
requirement regulation s are no longer required to include export credits in their leverage ratios.176 
This came about due to problems related to Basel III implementation, whe reby export finance banks 
were essentially penalized for having government -backed export credits as part of their portfolio. 
Thus, in 2019, the regulation was amended to remove the guaranteed part of exposures arising from 
export credits from the total exp osure measure if certain conditions were met.177 Thus, if the 
exposures in the form of guarantee s for officially -supported export credits  are provided by an export -
credit agency in the local currency, they are totally exempt and, for those offerings in other  
currencies, they may be partially or fully exempt depending on the export -credit agency's credit 
rating. This is expected to give a boost to the export -credit business and to the banks that offer 
export credits, and also improve liquidity.  
Table 3.12 Overview of legislation pertaining to export credits, guarantees or insurance  
Legislation  Title  Overview  Link 
Council Decision of 
10 December 1982 
(No. 82/854/EEC)  Rules applicable, in the 
fields of export 
guarantees and finance 
for export, to certain 
subcontracts with parties 
in other Member States 
of the European 
Communities or in 
non-member countries  Includes specific rules on 
subcontracts when there 
are parties other than 
member States  involved 
in an undertaking.  https://eur -
lex.europa.eu/legal -
content/en/ALL/?uri=CE
LEX:31982D0854   
Council Directive 
No. 98/29/EC of 
7 May 1998 Harmonisation of the 
main provisions 
concerning export -credit 
insurance for 
transactions with 
medium and long -term 
cover  Harmoni zes cover, 
premiums and cover 
policy for export -credit 
insurance, guarantees or 
refinancing products that 
have the support of a 
member State .  https://eur -
lex.europa.eu/legal -
content/en/ALL/?uri=CE
LEX:31998L0029   
Council Decision of 
13 November 2006 
(No. 2006/789/EC)  Consultation and 
information procedures 
in matters of credit 
insurance, credit 
guarantees and financial 
credits  Establishes a set of 
Community norms on 
credit in its Annex that 
cannot be departed from 
without consultation. 
These include credit 
duration, per cent of 
local expenditure, and 
leasing contracts.  https://eur -
lex.europa.eu/legal -
content/en/ALL/?uri=CE
LEX:32006D0789   
Regulation (EU) 
No. 1233/2011 ; and 
Commission Delegated 
Regulation (EU) 
No. 2018/179  The application of certain 
guidelines in the field of 
officially supported 
export credits  Applies the OECD's 
Arrangement on 
Officially Supported 
Export Credits to 
member States , and 
establishes transparency 
and reporting measures . 
The Regulation fr om 
2018 updates and 
replaces the Annex 
containing the 
Arrangement to reflect 
changes in that 
agreement.  https://eur -
lex.europa.eu/legal -
content/en/ALL/?uri=CE
LEX:32011R123 3  
 
https://eur -
lex.europa.eu/legal -
content/EN/TXT/?qid=15
62013388827&uri=CELE
X:32018R0179   
                                                
176 Regulation (EU) No. 575/2013 of the European Parliament and of the Council of 26  June 2013 on 
prudential requirements for credit institutions and investment firms and amending Regulation (EU) 
No. 648/2012. Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/ ?uri=celex%3A32013R0575 . 
177 Regulation (EU) 2019/876 of the European Parliament and of the Council of 20 May 2019 amending 
Regulation (EU) No. 575/2013 as regards the leverage ratio, the net stable funding ratio, requirements for own 
funds and eligible liab ilities, counterparty credit risk, market risk, exposures to central counterparties, 
exposures to collective investment undertakings, large exposures, reporting and disclosure requirements, and 
Regulation (EU) No. 648/2012. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32019R0876 .  WT/TPR/S/395 • European Union  
 
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  Legislation  Title  Overview  Link 
Communication from the 
Commission on short -
term export -credit 
insurance  Rules on application of 
Articles 107 and 108 of 
the Treaty on the 
Functioning of the 
European Union to short -
term export -credit 
insurance  Sets out conditions for 
member States insuring 
STEC risks, thereby 
addressing distortions of 
competition a mong 
export -credit insurers as 
well as exporters in 
different member States . https://eur -
lex.europa.eu/legal -
content/EN/TXT/PDF/?uri
=CELEX:52012XC1219(0
1)&from=EN   
OECD Arrangementa Arrangement on 
Officially Supported 
Export Credits  It seeks to foster a level 
playing field for official 
support, to encourage 
competition among 
exporters. It sets terms 
and condit ions; classifies 
countries; has provisions 
on interest rates, 
premium rates and other 
fees; and has rules for 
tied aid. There are also 
six Annexes containing 
sectoral 
understandings.b https://www.oecd.org/tr
ade/topics/export -
credits/arrangement -
and-sector -
understandings/   
a Incorporated through Regulation (EU) No. 1233/2011.  
b Sectoral understandings include: Ships; Nuclear Power Plants; Civil Aircraft; R enewable Energy, 
Climate Change Mitigation and Adaptation, and Water Projects; Rail Infrastructure; and Coal -Fired 
Electricity Generation Projects.  
Source:  Compiled from the various instruments listed.  
3.124.   There is limited comparable data on the size or activi ties of the export -credit sector in the 
EU. Regulation (EU) No. 1233/2011  is the first instrument that requires EU reporting, although it 
does not provide comprehensive figures for all member States. The OECD also has some statistics 
on export -credit cash flows from OECD members of the Working Party on Export Credits and Credit 
Guarantees  (Table 3.14). As the data show, Italy, Germany, Sweden, and France stand out as the 
largest providers of export credit. Many of the more recently -acceded member States hav e generally 
no export -credit programmes, or relatively small ones. If figures available from the OECD are an 
indication of the export -credit market, given that they collect information on medium - and long-term 
Arrangement official export credits , about USD  37.8 billion in credits was provided by EU member 
States in 2016 (Table 3.13).  
Table 3.13 Export -credit statistics, as reported to the OECD, 2016 -17 
 Official 
export 
credit 
offereda Net operating cash 
flowb (all types, all 
maturities)  Net operating cash flowb 
(insurance/ guarantee 
products)  Net operating cash flowb 
(direct lending products)  
2016  2016  2017  2016  2017  2016  2017  
Austria  483 145.7  84.0 156.2  93.7 0 0 
Belgium  520 73.7 -143.5  87.7 -131.8  .. .. 
Bulgaria  - - - - - - - 
Croatia  - - - - - - - 
Cyprus  - - - - - - - 
Czech 
Republic  152 -78.7 -6.8 -122.7  -46.0 60.9 57.1 
Denmark  1,653  65.2 -39.1 61.2 -47.1 22.7 27.6 
Estonia  - 0 0.2 - - 0 .. 
Finland  1,090  -216.5  35.4 -208.6  43.5 0 0 
France  2,961  1,351.5  637.3  1,351.5  655.7  0 0 
Germany  10,246  939.5  115.1  1,008.8  184.4  .. .. 
Greece  - - - - - - - 
Hungary  219 63.3 6.4 11.7 -2.1 42.0 24.9 
Ireland  - - - - - - - 
Italy 10,321  667.2  566.0  725.4  629.5  0 .. 
Latvia  - -0.3 -0.4 -0.1 -0.1 0 0 WT/TPR/S/395 • European Union  
 
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   Official 
export 
credit 
offereda Net operating cash 
flowb (all types, all 
maturities)  Net operating cash flowb 
(insurance/ guarantee 
products)  Net operating cash flowb 
(direct lending products)  
2016  2016  2017  2016  2017  2016  2017  
Lithuania  - - - - - - - 
Luxembourg  - -13.0 -5.2 -12.2 -4.4 .. .. 
Malta  - - - - - - - 
Netherlands  1,546  252.6  151.0  263.9  163.1  .. .. 
Poland  203 -35.6 -22.6 -33.8 -20.5 0 0 
Portugal  - 14.3 3.0 17.8 3.9 .. .. 
Romania  - - - - - - - 
Slovak 
Republic 107 16.6 4.1 0.2 0.5 13.7 9.0 
Slovenia  - 0.7 -11.5 2.2 -9.8 .. .. 
Spain  1,366  144.6  22.2 162.1  36.0 .. .. 
Sweden  6,083  47.9 -0.9 68.4 18.3 .. .. 
United 
Kingdom  888 260.3  166.4  282.5  153.1  7.1 43.8 
- Null or none.  
.. Not available.  
a USD millions. As defined by the OECD Arrangement.  
b SDR millions.  
Source:  OECD, Export Credit Statistics – Trends and Cashflow . Viewed at: 
https://www.oecd.org/trade/topics/export -credits/statistics/ ; and 
https://www.oecd.org/trade/topics/export -credits/documents/2017 -oecd-export -credits -cashflow -
results -en.pdf ; and information provided by the authorities.  
3.3  Measures Affecting Production and Trade  
3.3.1   Incentives  
3.125.   The EU provides incentives in the form of subsidies and state aid.  It notified its s ubsidies 
programmes to the WTO in 2019. These are granted both out of the EU budget and by member 
States through  state aid. The most recent information and statistical data refers to subsidies granted 
in 2017-18; subsidies granted by individual member States are co ntained in addenda to that 
notification.178 
3.3.1.1   EU-level subsidies  
3.126.   At the EU level, as has been the case in the last years, t he two largest areas of expenditure 
over 2017-18 were agriculture  and structural operations , mainly through t he European  Structural 
and Investment Funds (ESI F). Another notable area of expenditure is research.   
3.127.   The ESI F amount to EUR 644 billion during 2014 -20, 71.6% of which is EU financing 
(EUR 461 billion) and 28.4% is EU -28 co -financing ( EUR 183 billion) . They are  composed of 
six funds: the European Regional Development Fund (ERDF)  (43.3% of total ESIF budget);  the 
European A gricultural Fund for Rural Development (EAFRD)  (23.5%);  the European Social Fund 
(ESF)  (18.7%);  the Cohesion Fund  (CF) (11.6%);  the European  Maritime and Fisheries Fund (EMFF)  
(2.0%); and the Youth Employment Initiative (YEI) (1%) .179 
3.128.   The ERDF aims to strengthen economic and social cohesio n by correcting imbalances 
between EU regions. It focuses its investments on four priority areas: innovation and research; the 
digital agenda; support for SMEs; and a low-carbon economy. ERDF resources depend on the 
category of the region: in more developed regions, at least 80% of funds must focus on at least two 
of these priorities; in transition regions , 60%; and in less developed regions , 50%.  Also, s ome ERDF 
                                                
178 WTO document G/SCM/N/343/EU, 13 Septembre 2019.  
179 European Commission, European Structural and Investment Funds: EU  Overview . Viewed at:  
https://cohesiondata.ec.europa.eu/overview . WT/TPR/S/395 • European Union  
 
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  resour ces must be channeled towards low -carbon economy projects: more developed regions , 20%; 
transition regions , 15%; and less -developed regions , 12%.180 
3.129.   The EAFRD  is worth EUR 100 billion over 2014-20, with a further EUR 61 billion of public 
funding in EU countries . Member States and regions draw up their rural development progra mmes,  
based on the needs of their territories and addressing at least four of the following six EU priorities : 
fostering kn owledge transfer and innovation in agriculture, forestry and rural areas; enhancing the 
viability and competitiveness of all types of agriculture, and promoting innovative farm technologies 
and sustainable forest management; promoting food chain organi zation, animal welfare and risk 
management in agriculture; restoring, preserving and enhancing ecosystems related to agriculture 
and forestry; promoting resource efficiency and supporting the shift toward s a low -carbon and 
climate -resilient economy in the a griculture, food and forestry sectors; and promoting social 
inclusion, poverty reduction and economic development in rural areas.181 
3.130.   The ESF investments cover all EU regions. More than EUR 80 billion is earmarked for human 
capital investment in member States  in 2014-20. In 2014-20, the ESF will focus on four of the 
cohesion policy's thematic objectives: promoting employment and supporting labo ur mobility; 
promoting social inclusion and combat ting poverty; investing in education, skills and lifelong 
learning; and enhancing institutional capacity and an efficient public administration . In addition, 
20% of ESF investments will be committed to activities improving social inclusion and combat ting 
poverty.182 
3.131.   The CF covers member States whose gross national income per  inhabitant is less than 90% 
of the EU average183, and, inter alia , funds projects in the field of transport and environmental 
infrastructure.  The CF's overall policy goal is to support job creation, business competitiveness, 
economic growth , and sustainable  development in all regions. It allocates a total of EUR 63.4 billion 
to activities under trans -European transport networks (TEN -E) and the  environment.184 
3.132.   The EMFF helps fishermen in the transition to wards  sustainable fishing; supports coastal 
communities in diversifying their economies; finances projects that create new jobs and improve 
quality of life along European coasts; supports sustainable aquaculture developments; and makes it 
easier for applicants to access financing. It is used to co -finance projects, along with national 
funding. Each member State  is allocated a share of the total EMFF budget, based on the size of its 
fishing industry. Once the Commission approves this fund, it is up to the nationa l authorities to select 
the operations eligible for funding. The national authorities and the Commission are jointly 
responsible for the implementation of the fund.185 
3.133.   The YEI supports  young people  living in regions where youth unemployment was higher than 
25% in 2012. It was topped up in 2017 for regions with youth unemployment higher than 25% in 
2016. It exclusively supports young people who are not in education , employment or training , 
including the long -term unemployed or those not registered as job -seeke rs. The YEI's total budget  
is EUR 8.8 billion for 2014 -20.186 Of the total budget, EUR 4.4 billion comes from a dedicated Youth 
Employment budget line, complemented by EUR 4.4 billion more from ESF national allocations.187 
3.134.   In 2017, the European Commission  published an overview of subsidy disclosure practices in 
EU member States. The report review ed 336 subsidy program mes over the period 2010 -14, and set 
                                                
180 WTO document G/SCM/N/343/EU, 13 September 2019.  
181 European Commission, Rural Development 2014 -2010. Viewed at:  
https://ec.europa.eu/agriculture/rural -development -2014-2020_en . 
182 European Commission, European Social Fund . Viewed at:  
https://ec.europa.eu/regional_policy/en/funding/social -fund/ . 
183 For 2014 -20, these are: Bulgaria, Croatia, Cyprus, the Czech Republic, Estonia, Greece, Hungary, 
Latvia, Lithuania, Malta, Poland, Portugal, Romania, the Slovak Republic, a nd Slovenia.  
184 European Commission, Cohesion Fund . Viewed at:  
https://ec.europa.eu/regional_policy/en/funding/cohesion -fund/ . 
185 European Commission, European Maritime and Fisher ies Fund . Viewed at:  
https://ec.europa.eu/fisheries/cfp/emff/ . 
186 The YEI's initial budget was EUR 6.4 billion; however, in September 2016, given the still high levels 
of youth unemployment, the European Commission proposed to increase this budget, and EUR 2.4 billion was 
added for eligible member States for the period 2017 -20. 
187 European Commission, Youth Employment Initiative (YEI) . Viewed at:  
https://ec.europa.eu/social/main.jsp?catId=1176 . WT/TPR/S/395 • European Union  
 
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  up a methodology to be used with any future dataset. Accord ing to findings, all member States are 
giving info rmation about the availability of subsidies and the ways to apply for them. The study also 
provide d some recommendations on , inter alia , data versioning, improving the disclosure of tax 
incentives, and improving the functionality of existing tools.188 
3.3.1.2   State aid  
3.135.   State aid by member States is regulated under Articles 107 to 109 of the TFEU. According 
to these provisions, s tate aid is prohibited, unless it  is approved by the Commission (either following 
an individual notification of plans to grant aid, or on the basis of ex ante -defined compatibility 
conditions laid down in a block exemption regulation),  serves an objective of common interest , and 
meets other strict conditions :  
• objective of common interest: the aid must promote a specific objective of comm on 
interest, e.g. research, development and innovation  (R&D&I), or environmental 
protection;  
• need for state intervention: state aid is targeted towards bringing about a material 
improvement that the market alone cannot deliver, for example by remedying a 
well-defined market failure;  
• appropriateness of the aid: the proposed aid measure is an appropriate policy instrument 
to address the objective of common interest;  
• incentive effect: the aid changes the behaviour of the undertaking(s) concerned in such a 
way that it engages in additional activity which it would not carry out without the aid, or 
which it would carry out in a restricted or different manner;  
• proportionality of the aid: the amount of aid is limited to the minimum needed to 
incentivize the addit ional investment or activity in the area concerned;  
• avoidance of undue negative effects on competition and trade between member States: 
the negative effects of aid are limited so that the overall balance of the measure is positive; 
and 
• transparency of aid.  
3.136.   Since  2012, the Commission has implemented a major reform of EU state aid rules, the 
State Aid Modernization (SAM) . It allows member  States to implement state aid that fosters 
investment, economic growth and job creation more quickly, while leaving the Co mmission to focus 
its State aid control on cases most liable to distort competition.  As part of the SAM, the Commission  
has revised a considerable number of State aid rules since 2013. The Commission  is currently 
evaluating most of the state aid rules in o rder to take stock of the results of the SAM and whether 
the rules are fit for purpose. The objective is to allow the Commission  to take evidence -based policy 
decisions as regards the design of state aid rules in the EU in the future.  
3.137.   As previous Secretari at report s point out, member States are, in principle, required to notify 
state aid measures to the Commission , which must approve the measures before they can be 
implemented.  State aid measures are exempted from the notification requirement if they meet the 
requirements of regulations defining ex ante  compatibility conditions, for example the Commission's 
General Block Exemption Regulation (GBER189), which was renewed in July 20 14, and updated in 
2017. The GBER applies to all sectors of the economy , with some exceptions. Sectoral restrictions 
are set out in Article 1, paragraphs  3-5 of the Regulation, and include specific activities in fisher ies 
                                                
188 European Commission, An Overview of Subsidy Disclosure Practices in EU Member States . Viewed at: 
http://ec.europa.eu/competition/publications/reports/kd0617273enn.pdf . 
189 European Commission, General Block Exemption Regulations (GBER). Viewed at: 
https://ec.europa .eu/competition/state_aid/legislation/block.html . WT/TPR/S/395 • European Union  
 
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  and aquaculture190, in the primary p roduction of agricultural products, and the coal sector . The steel 
sector, shipbuilding, and the synthetic fibres sector  cannot receive investment aid . 
3.138.   The GBER allows for aid in favour of: regional investment; SMEs and access to finance for 
SMEs; environm ental protection; consultancy in favour of SMEs;  Research Development and 
Innovation  (R&D&I ); training; employment of disadvantaged and disabled workers; culture and 
heritage conservation; local infrastructures; broadband infrastructures; sport and multifu nctional 
recreational infrastructures; and transport for residents of promoted regions. Each of the GBER 
articles which cover the activities listed above lists the eligible costs which may be assisted and the 
aid intensities (limits) which apply to these a ctivities.  
3.139.   A sector -specific framework of state aid rules was set up for state aid control relating to 
agriculture, forestry and certain non -agricultural activities in rural areas. That framework comprises 
Guidelines for the Commission 's assessment of noti fied aid, a n Agricultural  Block Exemption 
Regulation (ABER) , and a regulation on de minimis  aid to farmers. The provisions laid down in the 
ABER and the Guidelines largely mirror the rules on EARDF support.  
3.140.   If the member State forgets or neglects to notify the aid measure and puts it into effect 
without prior Commission  approval, or if a measure exempted from the notification obligation is not 
in line with the respective rules ( notably  the GBER), the Commission  can s tart an ex officio  
investigation of the aid. If the aid does not meet the requirements of the EU state aid rules, the 
Commission, after a formal investigation procedure, can order the member State to recover the aid. 
This means that the undertaking that received the aid must reimburse the aid with interest to the 
member State in question. National cour ts of the EU member States also play a role when it comes 
to such unlawful aid , as they also can order the company to re imburse  the aid.  
3.141.   In November 2017, the Commission  published an ex post assessment of the impact of state 
aid on competition , looking at four specific cases of state aid granted five to ten years ago. The 
report indicates  different areas of aid that might affect competition, such as the relative amount and 
breadth of the aid, market definitions, and the effect on adjacent markets.191 
3.142.   In 2018,  the European Court of Auditors initiated a high -priority performance audit to assess 
the efficiency and effectiveness of EU state aid procedures and  of fund aid for banks. The audit report 
on state aid to banks is planned for the first quarter of 2020.  
Non-crisis state aid  
3.143.   The Commission publishes, annually, a state aid scoreboard based on expenditure reports 
by member States.192 According to the latest report, in 2017, EUR 116.2  billion (i.e. 0.76% of EU 
GDP) were provided for non -crisis state aid (excluding rail transport ), against EUR 106.6 billion or 
0.72% of EU GDP in 2016. About 53% of total spending was attributed to state aid for environmental 
and energy savings . In 2017, about 94% of total state aid spe nding was allocated to horizontal 
objectives of common interest or "good aid" (e.g. environmental protection, R&D&I  and regional 
development).  On the contrary, state aid spending for rescuing and restructuring companies in 
difficulty decreased significantl y over the last five years, by about 15% annually.  In addition, in 
2017, EUR 43.6 billion was provided for rail transport ( half for public service obligations and 
pensions, and half for infrastructure and other aid). Member States used mainly grants ( around 
EUR 71 billion) as instruments for state aid, followed by tax exemptions (Table 3. 14).193 
                                                
190 For fisheries, the Fisheries Block Exemption Regulation (FIBER) (Commission Regulation (EU) 
No. 1388/2014) was adopted on 16 December 2014 and entered into force on 1 January 2015.  
191 European Commission,  Ex post assessment of the impact of state aid on competition . Viewed at:  
http://ec.europa.eu/competition/publications/reports/kd0617275enn.pdf . 
192 Article 6(1) of Commission Regulation (EC) No. 794/2004 . Expenditure refers to all active aid 
measures to industries, services, agriculture and fisheries, for which the Commission adopted a formal decision 
or received an information sheet from the member States in relatio n to measures qualifying for exemption 
under the GBER. Figures in the scoreboard do not include funding granted in line with the de minimis  rules, 
since this spending is not deemed to constitute state aid. They also exclude most of the aid to railways and 
services of general economic interest.  
193 European Commission, State Aid Scoreboard 2018: Results, trends and observations regarding EU28 
State Aid expenditure reports for 2017 . Viewed at: 
http://ec.europa.eu/competition/state_aid/scoreboard/state_aid_scoreboard_2018.pdf . WT/TPR/S/395 • European Union  
 
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  Table 3.14 Non-crisis related state aid , 2013 -17 
(EUR million)   
2013 2014 2015 2016 2017 
Total state aid (excluding 
railways ) 68,350.6  98,654.6  101,178.6  106,609.1  116,213.6  
Non-agricultural aid  60,365.7  91,295.2  94,621.0  101,298.5  110,685.0  
of which (by objective)       
 Closure aid  1,534.4  1,582.1  1,568.4  1,451.5  1,554.5  
 Compensation for damages caused 
 by natural disasters  236.1  433.9  389.7  601.1  589.6  
 Culture  2,686.3  3,553.4  4,737.3  5,478.6  5,686.2  
 Employment  2,898.3  2,723.5  2,552.8  2,295.7  2,519.7  
 Environmental protection , including  
 energy saving  15,822.1  42,394.0  46,805.3  57,104.8  61,278.1  
 Heritage conservation  575.2  532.3  572.5  28.4 24.0 
 Promotion of export and 
 internationalization  251.0  172.7  78.1 54.0 788.0  
 Regional development  13,034.3  14,782.1  11,337.6  8,499.1  9,888.2  
 Rescue and restructure  585.9  651.3  623.3  133.7  244.9  
 R&D  including  innovation  9,189.5  9,235.7  8,793.9  9,453.8  8,814.9  
 Sectoral development  5,314.4  4,978.4  5,248.6  4,921.3  5,111.8  
 SMEs, including  risk capital  3,572.4  3,795.0  4,631.8  4,492.7  5,782.3  
 Social support to consumers  3,335.8  5,348.1  5,682.4  4,033.3  3,944.1  
 Training  824.5  641.2  762.5  479.9  525.1  
 Other  505.6  471.5  836.7  2,270.6  3,933.6  
of which (by aid instrument)       
 Equity participation  545.9  645.3  749.3  531.8  473.9  
 Grant  32,264.0  57,484.6  57,731.8  62,482.7  70,686.7  
 Guarantee  3,353.9  2,677.6  1,876.7  284.0  290.9  
 Soft loan  1,268.4  1,790.6  1,258.6  778.1  1,427.7  
 Tax deferral  41.5 34.6 26.5 0.6 0.5 
 Tax exemption  22,339.1  28,197.7  30,892.1  32,432.5  32,455.3  
 Other  558.6  464.8  2,085.9  4,789.0  5,350.1  
of which       
 Co-financeda 5,992.0  9,350.5  8,634.0  8,342.2  12,545.6  
 Not co -financed  54,373.8  81,944.6  85,987.0  92,956.3  98,139.4  
Agricultural aid  7,984.8  7,359.5  6,557.6  5,310.6  5,528.6  
of which       
 Agriculture and rural development  7,914.9  7,318.8  6,524.1  5,273.9  5,499.9  
 Aid granted to fisheries and 
 aquac ulture  69.9 40.7 33.5 36.7 28.7 
Transport aid (excluding 
railways)  1,615.6  1,908.1  2,114.3  2,164.6  1,701.2  
of which       
 Road 109.8  83.3 550.0  725.4  370.0  
 Maritime transport  1,237.4  1,158.4  1,226.1  1,231.3  1,075.3  
 Inland water transport  27.0 56.6 50.6 50.4 60.9 
 Air transport  196.5  537.7  205.9  89.3 135.3  
 Other transport  44.8 72.2 81.6 68.2 59.8 
Railway supportb 42,386.5  43,232.6  46,254.1  41,191.9  43,577.8  
 Public service obligations  and 
 pensions  19,008.3  21,321.1  21,890.6  21,906.9  22,264.1  
 Infrastructure and other aid  23,425.0  21,911.6  24,363.5  19,285.0  21,313.7  
a Member States are required , since 2014,  to indicate for co -financed schemes: ( i) the percentage of 
aid that is co -financed; and ( ii) the total amount of aid that is co -financed including both national 
and EU structural funds expenditure. Before 2014, only national expenditure was reported for a id 
measures that were co -financed by Community funding.  
b The Commission notes that railway support includes a significant amount that is not classified as 
state aid.  
Source:  European Commission , State Aid Scoreboard 2018 : Results, trends and observations regarding EU28 
State Aid expenditure reports for 2017 . Viewed at: 
http://ec.europa.eu/competition/state_aid/scoreboard/state_aid_scoreboard_2018.pdf . 
3.144.   The obs erved uptake of expenditure under the GBER is attuned with EU policy initiatives 
such as the Europe 2020 Strategy; the Programme for the Competitiveness of Enterprises and SMEs 
(COSME); ensuring enough flexibility and high amounts of R&D&I aid in a context  of strong global WT/TPR/S/395 • European Union  
 
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  competition; and supporting easier deployment of broadband in line with the EU Digital Agenda that 
sets ambitious goals for broadband infrastructure development to support growth in Europe.194 
3.145.   According to the Commission , while the time nee ded to assess notified measures has 
remained stable, notified measures that might seriously harm competition or fragment the single 
market are subject to more scrutiny and tend to cover bigger budgets and spending than in the past, 
in line with the Commiss ion's approach to be "big on big and small on small ". In 2017, about 
230 cases  were notified to the Commission. The average annual budget of notified measures 
implemented was around  EUR 230 million, an increase of about 18% compared to 2015.195 
3.146.   In 201 7, Germ any (EUR 43 billion) and France (EUR 17 billion) provided over 50% of the 
total of non -crisis related state aid in the EU (Chart 3. 6). In Germany's case, 80% of total state aid 
(less railways) was devoted to environmental protection, including energy saving. In France, a 
significant proportion was for public service obligations, pensions and infrastructure for railways.  
The United Kingdom (EUR 9 billion), Poland ( EUR 7 billion) , and Italy ( EUR 6 billion)  are the next 
biggest providers of state aid.196 
Chart 3.6 State aid, 2017  
(EUR million)  
 
Source:  European Commission , State Aid Scoreboard 2018 : Results, trends and observations regarding EU28 
State Aid expenditure reports for 2017 . 
Crisis -related state aid 
3.147.   As covered in previous Secretariat reports, in relation to financial institutions, the 
Commission updated and prolonged a series of communications adopted during the crisis  in 2008 -09. 
The amount of aid approved in relation to financial institutions decreased over the period 2008 -17 
(Table  3.15).  In 2017, the level of state aid to the financial sector, both approved and used, was at 
its lowest level since the beginning of the financial crisis , except for capital aid instruments where 
around EUR 12.1 billion were employed to address legacy cases requiring recapitali zation aid.  The 
                                                
194 European Commission, State Aid Scoreboard 2018: Results, trends and observations regarding EU28 
State Aid expenditure reports for 2017 . Viewed at: 
http://ec.europa.eu/competition/state_aid/scoreboard/state_aid_scoreboard_2018.pdf . 
195 European Commission, State Aid Scoreboard 2018: Results, trends  and observations regarding EU28 
State Aid expenditure reports for 2017 . 
196 European Commission, State Aid Scoreboard 2018: Results, trends and observations regarding EU28 
State Aid expenditure reports for 2017 . 
05,00010,00015,00020,00025,00030,00035,00040,00045,00050,000
State aid (less rail transport)
Rail transport (public service obligations + pensions + infrastructure + other aid)Chart 3. State aids (including railway support transport for pensions and public service obligations), 2017
(€ million)
Commission online information. Viewed at:  http://ec.europa.eu/competition/state_aid/scoreboard/index_en.html [April 2019]. Source:WT/TPR/S/395 • European Union  
 
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  European banking sector relies less and less on government guarantees, as shown by the reduced 
use of liquidity aid support.197 
Table 3.15 Use of crisis -related state aid, 2008 -17 
(EUR billion)  
 
Belgium  
Denmark  
Germany  
Ireland  
Greece  
Spain  
France  
Italy  
Netherlands  
Austria  
Portugal  
United 
Kingdom  
Total EU -28 
Recapitalizations  
2008 14.4 0.5 20.0 - - - 13.2 - 14.0 0.9 - 49.4 115.2  
2009 3.5 8.0 32.9 11.0 3.8 1.3 9.3 4.1 - 5.9 - 9.7 90.7 
2010 - 1.9 6.7 35.3 - 9.5 - - 4.8 0.6 - 34.6 93.5 
2011 - 0.3 3.6 16.5 2.6 8.5 - - - - - 3.2 35.0 
2012 2.9 - 0.9 - 30.9 40.4 2.6 2.0 - 2.0 6.8 - 90.8 
2013 - - - - 3.5 2.1 - 1.9 4.2 1.8 1.1 3.3 20.5 
2014 - - - - - - - - - 0.8 4.9 - 7.6 
2015 - - - - 5.8 - - 3.6 - - 1.8 - 11.3 
2016 - - - - - - - - - - - - - 
2017 - - - - - - - 11.3 - - - - 11.3 
2008-17 20.8 10.8 64.2 62.8 46.7 61.9 25.0 22.8 23.0 11.8 14.5 100.1  475.9  
Impaired asset measures  
2008 - - 9.8 - - - - - - - - - 9.8 
2009 7.7 - 24.8 - - - 1.2 - 5.0 0.4 - 40.4 79.5 
2010 - - 45.0 2.6 - 2.9 - - - - 3.1 - 54.0 
2011 - - - - - - - - - - - - - 
2012 9.4 - 0.4 - - 25.5 - - - 0.1 - - 35.4 
2013 4.7 0.3 - - - 4.5 - - - - - - 9.5 
2014 
2015 
2016 
2017 
2008-17 - 
- 
- 
- 
21.8 - 
- 
- 
- 
0.3 - 
- 
- 
- 
80.0 - 
- 
- 
- 
2.6 - 
- 
- 
- 
- - 
- 
- 
- 
32.9 - 
- 
- 
- 
1.2 - 
- 
0.3 
- 
0.3 - 
- 
- 
- 
5.0 - 
- 
0.1 
- 
0.5 - 
- 
- 
- 
3.2 - 
- 
- 
- 
40.4 0.3 
0.3 
0.4 
- 
189.2  
Guarantees on liabilities  
2008 9.0 145.0  18.7 180.3  - - 8.7 - 0.9 2.4 1.2 33.5 400.4  
2009 46.8 6.4 135.0  284.3  1.5 36.1 92.7 - 36.0 15.5 5.2 158.2  835.8  
2010 32.8 22.3 132.0  196.3  26.7 55.8 91.5 - 40.9 19.3 5.0 150.7  799.8  
2011 26.4 23.0 34.7 110.5  56.3 61.7 71.8 10.9 33.2 17.1 8.5 115.2  589.0  
2012 45.6 1.2 10.0 83.5 62.3 72.0 53.4 85.7 19.4 11.8 16.6 21.9 492.1  
2013 36.9 0.7 3.0 37.2 47.8 53.6 46.9 81.7 12.4 2.4 14.4 9.1 352.3  
2014 37.6 - 2.0 10.6 60.0 11.1 36.1 22.0 - 4.1 3.5 14.1 204.5  
2015 33.7 - - 2.9 54.8 7.3 42.0 6.8 - 4.8 3.5 10.3 170.6  
2016 35.7 - - 2.4 16.9 4.7 41.4 6.6 - 5.5 3.1 6.2 126.1  
2017 36.0 - - 2.2 2.3 - 40.1 24.3 - 2.2 - 1.2 110.8  
2008-17 340.5  198.6 335.4  910.2  328.6  302.3  524.6  238.0  142.8  85.1 61.0 520.7  1,188.1  
Liquidity measures, other than guarantees on liabilities  
2008 - 0.6 3.6 - 0.5 2.3 - - 13.2 - 1.1 - 22.2 
2009 - 2.0 - - 4.3 19.3 - - 30.4 - 3.7 6.9 70.1 
2010 - 0.7 4.7 - 6.9 19.0 - - 7.9 - 3.8 18.5 62.6 
2011 - - - 0.1 6.6 13.5 - - 3.8 - 2.5 33.3 60.6 
2012 - - - 0.7 2.8 3.5 - - 3.8 - 0.2 32.7 44.3 
2013 - 0.0 - 0.9 2.3 0.2 - - 3.8 - - 26.8 34.6 
2014 - 0.2 - - 2.2 - - - 4.7 - - 24.0 31.6 
2015 - 0.1 - - 2.2 - - - 1.8 - - 17.2 21.8 
2016 - 0.1 - - - - - - 0.8 - - 11.0 12.4 
2017 - - - - - - - - 0.8 3.4 - 6.3 10.9 
2008-17 - 3.7 8.3 1.7 27.8 57.8 - - 71.0 3.4 11.2 176.7  108.4  
Note:  - refers to zero. Other member States either did not use crisis -related aid (Bulgaria, Croatia, 
Czech  Republic, Estonia, Malta, and Romania) or relatively small amounts (Finland, Hungary, 
Lithuania, Luxembourg, Poland, the Slovak  Republic , and Slovenia).  
Source:  European Commission , State Aid Scoreboard 2018 : Results, trends and observations regarding EU28  
State Aid expenditure reports for 2017 . Viewed at: 
http://ec.europa.eu/competition/state_aid/scoreboard/state_aid_scoreboard_2018.pdf . 
3.3.1.3   Taxation  
3.148.   Taxation is classified by the European system of accounts into three main categories: indirect 
taxes, defined as taxes linked to production and imports (notably VAT, excise duties and customs 
                                                
197 European Commission, State Aid Scoreboard 2018: Results, trends and observations regarding EU28 
State Aid expenditure reports for 2017 . WT/TPR/S/395 • European Union  
 
- 103 - 
 
  duties); direct taxes, consisting of current taxes on income and  on capital; and net social 
contributions by employers and households. Because of differing national tax structures, these 
three  categories vary considerably in importance across EU member States in terms of the revenue 
they generate.   
3.149.   Between 2014 and 201 7, taxes on production and imports, as a ratio to GDP, remained 
stable at 13. 5%, while current taxes on income and wealth amounted to 13.1% of GDP in 2017  
(12.8% in 2014) .198 Net social contributions to GDP was 13.3% in 2017  (13.3% in 2014) . 
3.150.   Tax revenue (inc luding social contributions) in the EU -28 accounted for 40.1% of GDP in 
2017 (39.6% in 2015),  i.e. EUR 6,180 b illion ( Table 3. 16). In 2017, tax revenue represented around 
90% of the EU's total general government revenue. As a percentage of GDP, in 2017, ta x revenue 
was highest in France (48.4%), Belgium (47.3%), and Denmark (46.5%), and lowest in Ireland 
(23.5%), Romania (25.8%), and Bulgaria (29.5%).199 
Table 3.16 Taxes and social contributions in the EU -28, 201 4-17 
(EUR billion)  
  2014  2015  2016  2017  
Total receipts from taxes and social contributions (including imputed 
social contributions) after deduction of amounts assessed but unlikely 
to be collected  5,603  5,879  5,970  6,180  
Total tax receipts  3,749  3,957  4,004  4,145  
 Taxes on production and imports  1,905  2,007  2,023  2,084  
 Taxes on products  1,560  1,648  1,672  1,724  
 Value added type taxes (VAT)  977 1,033  1,045  1,085  
 Taxes and duties on imports excluding VAT  60 63 68 70 
 Import duties  21 24 24 24 
 Taxes on imports excluding VAT and import duties  39 39 44 46 
 Taxes on products, except VAT and import taxes  523 552 560 570 
 Other taxes on production  346 359 351 359 
 Current taxes on income, wealth, etc.  1,808  1,910  1,936  2,018  
 Taxes on income  1,675  1,770  1,798  1,880  
 of which:      
 Taxes on individual or household income including holding gains  1,322  1,389  1,391  1,446  
 Taxes on the income or profits of corporations including holding 
gains 340 365 390 418 
 Other current taxes  133 141 139 139 
 Capital taxes  35 40 44 43 
Net social contributions  1,867  1,937  1,979  2,047  
 of which:      
 Employers' actual social contributions  984 1,022  1,037  1,076  
 Households' actual social contributions  759 790 814 843 
Capital transfers from general government to relevant sectors 
representing taxes and social contributions assessed but unlikely to be 
collected  14 15 12 11 
Note:  Includes taxes collected by the institutions of the EU in the context of the customs union.  
Source:  Eurostat database . 
3.151.   The main priorities of EU tax policy remain overhauling the way in which companies are 
taxed in the single market, eliminating tax barriers to cross -border economic activity , and 
combatting harmful tax competition , tax evasion , and tax fraud.  To this end, in October 2016, t he 
European  Commission proposed two directives, currently under discussion with member States : on 
a common corporate tax base (CCTB), and on a common consolidated corporate tax base 
(CCCTB) .200 A key change would be making t he CCCTB mandatory for companies with a turnover of 
more than EUR 750 million .  
                                                
198 Eurostat, Tax revenue statistics . Viewed at: https://ec.europa.eu/eurostat/statistics -
explained/index.php/Tax_revenue_statistics . 
199 Eurostat, Tax revenue statistics . 
200 European Commission, Proposal for a Council Directive on a Common Consolidated Corporate Tax 
Base (CCCTB) . Viewed at: https://ec.europa.eu/taxation_customs/sites/taxation/files/com_2016_683_en.pdf . WT/TPR/S/395 • European Union  
 
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  3.152.   The Commission wants member States to first agree on the common tax base before tackling 
the EU -wide consolidation of tax returns.  Companies operating  across borders in the EU would no 
longer have to deal with different sets of national rules when calculating their taxable profits. 
Consolidation means that there would be a "one-stop-shop" – the principal tax authority – where 
one of the companies of a g roup, that is, the principal taxpayer, would file a tax return. To distribute 
the tax base among member States concerned, a formulary apportionment system would be  
introduced. The legislative proposal falls under the special decision -making  procedure  anad is now 
in the hands of the Council .201 
Value Added Tax  (VAT)  
3.153.   The importance of VAT to member State government revenues differs significantly across 
member State s, ranging from 4.5% of GDP in Ireland  to 13.2% in Croatia (Table 3. 17). In principle, 
supplies of  goods and services are subject to a standard rate of at least 15% but member States 
may apply reduced rates of at least 5% on goods and services listed in Annex  III to the 2006 VAT 
Directive  (Council Directive No. 2006/112/EC) . They are also required to exempt from VAT activities 
listed in Articles 132 -137 of the VAT Directive (principally activities in the public interest (e.g. postal 
services, hospital and medical care, and children's education) as well as some financial 
transactions).202 
Table 3.17 VAT in the EU -28 
(% of GDP for 201 7, tax rates 201 9)  
VAT 
(% of GDP)  Standard rate 
(%) Reduced rate 
(%) Zero-rated  
Austria  7.7 20.0 10/13   
Belgium  6.8 21.0 6/12 Yes 
Bulgaria  9.0 20.0 9.0  
Croatia  13.2 25.0 5/13  
Cyprus  9.5 19.0 5/9  
Czech Republic  7.7 21.0 10/15   
Denmark  9.5 25.0  
Yes 
Estonia  9.1 20.0 9.0  
Finland  9.1 24.0 10/14  Yes 
France  7.1 20.0 5.5/10   
Germany  6.9 19.0 7.0  
Greece  8.1 24.0 6/13  
Hungary  9.5 27.0 5/18  
Ireland  4.5 23.0 9/13.5  Yes 
Italy 6.3 22.0 4/5/10  
Latvia  8.0 21.0 12.0  
Lithuania  7.8 21.0 5/9  
Luxembourg  6.3 17.0 3/8/14  
Malta  7.3 18.0 5/7 Yes 
Netherlands  6.8 21.0 6.0  
Poland  7.8 23.0 5/8  
Portugal  8.6 23.0 6/13  
Romania  6.2 19.0 5/9  
Slovak  Republic  7.0 20.0 10.0  
Slovenia  8.1 22.0 9.5  
                                                
201 European Parliament, Common consolidated corporate tax base (CCCTB) . Viewed at: 
http://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_BRI(2017)599395 . 
202 Subject to certain conditions and procedures, member States may also apply a reduced rate on the 
supply of natural gas, electricity and district heating. By way of a  derogation from the normal rules, certain 
member States have been authorized to maintain reduced rates, including those lower than the minimum or 
zero rates, in certain areas. These derogations were granted during the negotiations preceding the adoption o f 
the VAT Rates Directive of 1992 or the Acts of Accession to the EU. The main objective of these derogations is 
to ensure the gradual transition towards the application of uniform rules. Council Directive No. 2006/112/EC of 
28 November 2006 on the common system of value added tax, p. 1. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/HTML/?uri=CELEX:32006L0112&from=EN .  WT/TPR/S/395 • European Union  
 
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VAT 
(% of GDP)  Standard rate 
(%) Reduced rate 
(%) Zero-rated  
Spain  6.5 21.0 4/10  
Sweden  9.3 25.0 6/12 Yes 
United Kingdom  6.8 20.0 5.0 Yes 
Source:  Eurostat , Main national accounts tax aggregates . Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui/ show.do?dataset=gov_10a_taxag&lang=en . European 
Commission (2019), VAT Rates Applied in the Member States of the European Union, Situation at 
1 January  2019, taxud.c.1(2019) , Brussels.  
3.154.   The common VAT system was set up in 1967, implemented in 1977 and reformed in 1993 
in order to adapt it to the entry into force of the internal market. The existin g rules governing trade 
between member States were always intended to be transitory. In 2018, the Commission proposed 
to amend the VAT Directive to introduce detailed technical measures of the definitive VAT system 
for intra -EU business to business (B2B) t rade in goods as a first step towards  creating a single 
EU VAT area, which the Commission announced in  its 2016 VAT action plan .203 The definitive VAT 
system should be fully based on the principle of taxation in the country of destination. Under the 
current transitional rules, this principle has already been introduced for most supplies of services 
since 2010.  
3.155.   In 2018, the Commission made two proposals , aiming to meet demands from member States 
to have more flexibility to set VAT rates and to extend VAT exemp tions that exist for domestic 
companies to small companies trading cross -border. There is also a proposal for a Council Regulation 
on combat ting VAT fraud.  The proposal on VAT rates will prevent certain existing reduced rates 
expiring with the introduction  of the definitive VAT system. It will also allow all other member States 
to apply similar VAT rates if they so wish.204 
3.156.   With the aim of creating a single EU VAT area, the Commission proposed to modify the 2006 
VAT Directive. In its 2016 VAT action plan205, the Commission announced its plan to move from the 
current system , where VAT is paid in the member State where the goods or services originate , to a 
system based on the principle of taxation in th e country  of destination . For the current system to 
work, VAT rates in different member States need to be as similar as possible so that unfair 
competition between countries  is kept to a minimum.  The current process by which a member State 
can seek to alter the rules on VAT rates requires unanimous agreement by a ll member States. There 
are also historical exemptions that apply in some countries, but not others.  
3.157.   Under the new Commission proposal, while a minimum standard VAT rate of at least 15% 
will continue to apply, member States may apply a range of rates to pr oducts: two separate reduced 
rates of between 5% and the standard rate chosen by the member State; one exemption from VAT 
(or "zero rate "); and one reduced rate set at between 0% and the reduced rate. At the same time, 
the Commission proposes to abolish th e list of goods and services to which reduced rates can 
currently be applied. Instead, there is now  a list of products to which reduced rates cannot  be 
applied, ensuring that products such as alcohol, weapons, tobacco and gambling will always be taxed 
at the standard rate or above. According to the Commission, that will give member States more 
freedom in setting VAT rates, as per their request.206 
3.158.   Under current VAT rules, member States can exempt sales by small companies from VAT , 
provided their turnover is below a national threshold (different in each member State). While the 
current national exemption thresholds in member States would remain, the proposal by the 
                                                
203 European Commission, Communi cation on an action plan on VAT: Towards a single EU VAT area – 
Time to decide . Viewed at: https://ec.europa.eu/taxation_customs/sites/taxation/files/com_2016_14 8_en.pdf . 
204 European Commission, Proposal for a Council Directive amending Directive 2006/112/EC as regards 
rates of value added tax . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/18012018_proposal_vat_rates_en.pdf . 
205 European Commission, Communication on an action plan on VAT: Towards a single EU VAT area – 
Time to decide . Viewed at: https://ec.europa.eu/taxation_customs/sites/taxation/files/com_2016_148_en.pdf . 
206 Safeguards will be introduced to avoid potential risks like revenue erosion, distortion of competition, 
unnecessary comp lexity, and legal uncertainty. Member States will be required to ensure that reduced rates 
benefit the final consumer and, in order to protect revenues, that the average VAT rate applied to those 
transactions for which VAT cannot be deducted always exceeds  12%. European Commission , Questions and 
Answers on the VAT Package . Viewed at: 
https://ec.europa.eu/commission/presscorner/detail/en/MEMO_18_186 . WT/TPR/S/395 • European Union  
 
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  Commission would introduce : a EUR 2 million revenue threshold across  the EU, under which small 
businesses would benefit from simplification measures, whether or not they have already been 
exempted from VAT; the possibility for member States to free all small businesses that qualify for a 
VAT exemption from obligations rela ting to identification, invoicing, accounting or returns; and a 
turnover threshold of EUR 100,000 which would allow companies operating in more than one 
member State to benefit from the VAT exemption. According to the Commission, these changes will 
reduce SME VAT compliance costs by up to 18% per year, leading to an increase in their cross -border 
trading activity by about 13%.207 
Income tax  
3.159.   Income  tax varies across EU member States, with different categories of income subject to 
income tax, different rates of  tax, and different treatment of expenses that may be deducted from 
gross income. In addition, local taxes on income may also apply, and can represent a considerable 
part of the charge on income. In 2017, income tax (for individuals and households, includi ng holding 
gains), as percentage of GDP, ranged from 3.1% in Cyprus to 25.4% in Denmark (Table 3.18 ). 
Table 3.18 Personal income taxes and households' social contributions  
(% of GDP for 2017, tax rates 2019)  
Member State  Income 
taxa 
(% of 
GDP) Households' 
actual social 
contributions 
(% of GDP ) Tax system  Top rate of 
income tax 
(%) Income for 
maximum 
income tax  
(single 
person)  
Austria  9.3 7.8 Progressive 6 brackets  50b EUR 90,000  
Belgium  12.1 5.5 Progressive 5  brackets  50 EUR 38,080  
Bulgaria  3.3 3.3 Flat rate  10  
Croatia  3.3 5.9 Progressive 2 brackets  36 EUR 4,019  
Cyprus  3.1 2.8 Progressive 5 brackets  35 EUR 60,000  
Czech Republic  4.0 5.3 Flat rate  15  
Denmark  25.4 0.7 Hybrid system  55.8c EUR 68,811  
Estonia  5.7 0.6 Flat rate  20  
Finland  12.6 4.3 Progressive 4 brackets  31.25  EUR 7 6,100 
France  8.7 5.6 Progressive 5 brackets  45 EUR 15 6,245 
Germany  9.4 9.0 Progressive formula  45 EUR 260,533  
Greece  6.2 6.8 Progressive 4 brackets  45 EUR 40,000  
Hungary  5.1 5.9 Flat rate  15  
Ireland  7.3 1.4 Progressive 2 brackets  40 EUR 3 5,300 
Italy 11.8 4.3 Progressive 5 brackets  43 EUR 75,000  
Latvia  6.6 2.4 Progressive 3  brackets  31.7 EUR 62,800  
Lithuania  3.9 3.9 Progressive 2 brackets  27 EUR 136,344  
Luxembourg  9.1 6.5 Progressive 23 brackets  42 EUR 200,003  
Malta  7.0 2.9 Progressive 4 brackets  35 EUR 60,000  
Netherlands  8.3 8.7 Progressive 4 brackets  51.75 EUR 6 8,507 
Poland  5.0 7.8 Progressive 2 brackets  32 EUR 20,543  
Portugal  6.5 3.9 Progressive 5 brackets  48 EUR 80,640  
Romania  3.5 3.2 Flat rate  10  
Slovak  Republic  3.4 6.1 Progressive 2 brackets  25 EUR 3 6,256 
Slovenia  5.1 8.9 Progressive 5 brackets  50 EUR 70,907  
Spain  7.5 3.3 Progressive 5  brackets  43.5d EUR 60,000  
Sweden  15.8 0.1 Progressive 2 brackets  25e EUR 70,134  
United Kingdom  9.2 3.1 Progressive 3 brackets  45 GBP 150,000  
a Taxes on individual or household income including holding gains.  
b Additional temporary rate of 55% is applicable for incomes above EUR 1 million until 2020.  
c Includes local tax (average 24.91%) . 
d Using as reference the region of Madrid.  
e Including local taxes.  
Source:  Eurostat , Main national accounts tax aggregates . Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=gov_10a_taxag&lang=en ; and 
European  Commission, Income Taxes Abroad . Viewed at: 
https://europa.eu/youreurope/citizens/work/taxes/income -taxes -abroad/index_en.htm . 
                                                
207 European Commission , Questions and Answers on the VAT Package . WT/TPR/S/395 • European Union  
 
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  Corporat ion tax 
3.160.   Corporat ion tax rates still differ significantly within the EU, with the nominal rate ranging 
from 10% in Bulgaria to 35% in Malta (Table 3. 19). In 2017 , corporation tax, as a percentage of 
GDP, ranged from 1.5% in Estonia and Lithuania to 5.9% in Malta. However, as in many other 
jurisdictions, differences in calcul ating allowable expenses, depreciation allowances, and other 
factors can mean that the effective tax on profits may be different to the nominal rate of tax. In 
addition to corporation tax, employers usually make significant social contributions which, for most 
member States, are greater than their corporation tax payments.  
Table 3.19 Corporation tax and employer's actual social contributions  
(% of GDP for 2017, tax rates 2019)  
Member State  Corporation 
taxa 
(% GDP) Employer 
social 
contributions 
(% GDP) Nominal 
rate 
(%) Profit tax 
(%) Labour 
taxes 
(%) Other 
(%) 
Austria  2.5 6.8 25.0 17.0 34.2 0.6 
Belgium  4.1 8.2 29.6 10.3 46.2 0.6 
Bulgaria  2.2 5.1 10.0 5.0 20.2 1.9 
Croatia  2.3 5.9 18.0 0.0 19.4 1.2 
Cyprus  5.7 5.9 12.5 8.1 13.4 1.2 
Czech Republic  3.5 9.7 19.0 9.1 38.4 2.5 
Denmark  3.0 0 22.0 17.7 3.8 2.7 
Estonia  1.5 10.6 20.0 7.9 38.8 2.0 
Finland  2.7 7.9 20.0 11.7 25.4 1.3 
France  2.9 11.3 32.0 0.7 51.1 10.4 
Germany  2.7 6.6 29.9 23.2 21.4 4.3 
Greece  1.9 4.7 28.0 23.0 28.0 0.7 
Hungary  2.7 6.9 0.8 9.9 34.3 2.3 
Ireland  2.8 2.4 12.5 12.4 12.2 1.4 
Italy 2.1 8.5 7.8 23.3 23.2 1.5 
Latvia  1.6 6.0 20.0 6.3 26.6 3.0 
Lithuania  1.5 8.3 15.0 5.9 35.2 1.6 
Luxembourg  5.2 4.6 24.9 4.2 15.5 0.8 
Malta  5.9 2.5 35.0 32.3 11.1 0.5 
Netherlands  3.3 5.1 25.0 20.5 19.8 0.4 
Poland  1.9 5.1 19.0 14.5 25.0 1.0 
Portugal  3.2 5.3 31.5 12.5 26.8 0.5 
Romania  2.0 5.3 16.0 11.6 25.8 1.0 
Slovak  Republic  3.5 8.5 21.0 10.5 39.7 1.4 
Slovenia  1.8 5.6 19.0 12.7 18.2 0.1 
Spain  2.3 8.4 25.0 10.6 35.6 0.7 
Sweden  2.9 3.1 21.4 13.1 35.4 0.6 
United Kingdom  2.8 4.7 19.0 18.1 10.9 1.7 
a Taxes on the income or profits of corporations including holding gains.  
Note:  The last three columns relate to the PwC/World Bank indicators for the Total Tax Rate. This 
measures the amount of taxes and mandatory contributions borne by businesses in the second year 
of operation, expressed as a share of commercial profit.  Nominal rates do not include various 
surcharges (e.g. regional surcharges).   
Source:  Eurostat , Main national accounts tax aggregates . Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui/show.do?datase t=gov_10a_taxag&lang=en ; 
European  Commission (2019), Taxation trends in the European Union - Data for the EU  Member 
States, Iceland and Norway , 2019 Edition . Viewed at: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/taxation_trends_report_2019.pdf ; 
European Commission, Taxes in Europe Database : 
http://ec.europa.eu/taxa tion_customs/tedb/taxSearch.html ; and World Bank/PwC (201 8), Paying 
Taxes 2018 , pp. 90-93. Viewed at: https://www.pwc.com/payingtaxes . WT/TPR/S/395 • European Union  
 
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  3.3.2   Standards and technical requirements  
3.161.   During the review period , there were some important changes to the basic legislative 
framework regarding technical requirements, standards, conformity assessment and accreditation. 
They include new rules on the mutual recognition of goods lawfully marketed in member States and 
a new  EU framework on market surveillance.  
3.162.   The princip al legislation setting the basis for these measures is described  in Table 3. 20. The 
EU framework of technical requirements, standards and conformity assessment is described  in the 
Blue Guide on the implemen tation of EU product rules. This document provides guidance on the 
application of product -related directives and regulations, which serve as harmonization legislation 
for non -food and non -agricultural products destined for the EU market.  The latest update to the 
Guide w as published in July 2016 .208 
Table 3.20 Principal TBT legislation , 2019 
Legislation  Note  
Regulation (EC) No. 765/2008  of the European 
Parliament and of the Council of 9 July 2008 setting 
out the requirements for accreditation and repealing 
Regulation (EEC) No.  339/93  Lays down rules on the organization and operation of 
accreditation for conformity assessment bodies. The 
Regulation also lays down the general principles for 
CE marking.  
Decision  No. 768/2008/EC  of the European 
Parliament and of the Council of 9 July 2008 on a 
common framework for the marketing of products, 
and repealing Council Decision No. 93/465/EEC  Sets out a common framework for the marketing of 
products. The Decision is a po litical commitment rather 
than applicable legislation, but it does require the 
European Parliament, Council, and Commission to 
adhere to its principals when preparing legislation.  
Regulation (EC) No. 764/2008  of the European 
Parliament and of the Council of 9 July 2008 laying 
down procedures relating to the application of 
certain national technical rules to products lawfully 
marketed in another member State, and repealing 
Decision 3052/95/EC  Lays down the rules and procedures to be followed by 
the competent authorities of a member State for 
decisions which may hinder the free movement of a 
product lawfully marketed in another member State. 
The Regulation also provides for the establishment of 
product contact points in the member States.  
Regulation (EU) No. 1025/2012  of the European 
Parliament and of the Council of 25 October 2012 on 
European standardization, amending Council 
Directives 89/686/EEC and 93/15/EEC and Directives 
94/9/EC, 94/25/EC, 95/16/EC, 97/23/EC, 98/34/EC, 
2004/22/EC, 2007/23/EC, 20 09/23/EC and 
2009/105/EC of the European Parliament and of the 
Council and repealing Council Decision 87/95/EEC 
and Decision 1673/2006/EC of the European 
Parliament and of the Council  Establishes rules for cooperation between European 
standardization organ izations, national standardization 
bodies, member States, and the Commission. It also 
sets out rules for the establishment of European 
standards and European standardization deliverables 
for products and services, the identification of 
information and comm unications technology ( ICT) 
technical specifications eligible for referencing, the 
financing of European standardization, and stakeholder 
participation in European standardization.  
Directive 2001/95/EC  of the European Parliament 
and of the Council of 3 December 2001 on general 
product safety  Applies principally to products which are not covered 
by harmonization legislation and sets up the rapid alert 
system (RAPEX) between the member States and the 
Commission and associated measures for products 
deemed t o be dangerous.  
Regulation (EU) 2019/515  of the European 
Parliament and of the Council of 19 March 2019 on 
the mutual recognition of goods lawfully marketed in 
another member State and repealing Regulation (EC) 
No. 764/2008  Lays down the rules and procedures to be followed by 
the competent authorities of a member State for 
decisions that may hinder the free movement of a 
product lawfully marketed in another member State.  
Regulation (EU) 2019/1020  of the European 
Parliament and of the Council of 20 June 2019 on 
market surveillance and compliance of products and 
amending Directive 2004/42/EC and Regulations 
(EC) 765/2008 and (EU) 305/2011  Lays down a framework for market surveillance and 
controls on products from th ird countries.  
Source:  European Commission.  
3.163.   In addition to the legislation  described in Table 3. 20, several other provisions constitute the 
backbone of the EU basic legislation in the context of the development and application of standards 
                                                
208 European Commission, The "Blue Guide" on the implementation of EU product rules 2016 . Viewed at: 
https://ec.europa.eu/growth/content/%E2%80%98blue -guide%E2%80%99 -implementation -eu-product -rules-
0_en. WT/TPR/S/395 • European Union  
 
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  and technical requirements. These provisions include the TFEU articles prohibiting quantitative 
restrictions and measures with equivalent effect  (Articles 34 -36), and case law from the C JEU on 
the general principle of the free movement of goods  and mutual recognition .  
3.164.   Generally, goods not subject to harmonization legislation and lawfully put on the market in 
one EU member State are subject to the principle of mutual recognition, which allows them to be 
marketed in a nother member State even if they do not conform to the second member 's technical 
regulations.  The only exceptions to this principle are restrictions introduced for reasons specified in 
Article 36 of the TFEU, or for other overriding reasons of public interest that are proportionate to the 
aim pursued.  
3.3.2.1   New Legislative Framework  
3.165.   Most of the EU product -related directives and regulations are drafted following the 
"New Approach " – called the New Legislative Framework  (NLF) and described in the previous 
EU TPR.209 The NLF calls for common basic requirements for a particular product /sector and 
addresses a particular risk to be made mandatory by legislation ; technical specifications aimed at 
achieving these requirements are contained in voluntary harmonized stand ards. As per Regulation 
(EU) No. 1025/2012, a harmonized standard "means a European standard adopted on the basis of 
a request made by the Commission for the application of EU harmonized legislation". In the absence 
of EU harmonized technical regulations, member States may develop and apply national technical 
regulations subject to specific procedures .210 
3.166.   The initial NLF package consisted of three main regulatory rules: (i) Regulation (EC) 
No. 765/2008 setting out the requirements for accreditation and the ma rket surveillance of products; 
(ii) Decision No. 768/2008 on a common framework for the marketing of products, which includes 
references provisions to be incorporated whenever product legislation is revised. In effect, it is a 
template for future product h armonization legislation; and (iii) Regulation (EC) No. 764/2008 laying 
down procedures relating to the application of certain national technical rules to products lawfully 
marketed in another EU country.  
3.167.   During the review period, certain of these regulato ry rules were reviewed and/or replaced 
as a follow -up to the "Goods Package " adopted by the Commission in December 2017 , to make it 
easier for companies, especially small and medium -sized enterprises (SMEs), to sell their products 
across the EU, and to str engthen controls by national and customs authorities and to prevent unsafe 
products from being sold to European consumers.211 
3.168.   With the aim of  making the principle on the mutual recognition of goods faster , simpler  and 
ensure its correct application in indivi dual cases, Regulation (EU) 2019/515212 was adopted on 
19 March 2019 and will apply as of 19 April 2020  replacing Regulation (EC) No . 764/2008. Pursuant 
to the new Regulation, member States that use existing technical regulations to restrict market 
access for products lawfully marketed in another member State must justify their position with 
technical and scientific evidence and must grant the economic operators affected an oppor tunity to 
provide comments. Under the new Regulation, companies will know if their products can be sold in 
another EU country in a few months, rather than years. They will also be able to use a voluntary 
declaration to demonstrate that their products meet all the relevant requirements in their country. 
This will make it easier for authorities to assess whether mutual recognition principle should apply. 
Furthermore, a  problem resolution mechanism is expected to allow for a faster resolution of disputes 
betwe en companies and national authorities.  
3.169.   As part of the "Goods Package " and in order to address the matter of  non-compliant products 
that do not meet EU requirements being  placed on the EU market, thereby endangering consumers, 
the Commission  also proposed a  new regulation on compliance and enforcement to create a fairer 
                                                
209 Formally launched in 1985 through t he Council Resolution on a new approach to technical 
harmonization and standards (85/C 136/01) of 7 May 1985.  
210 WTO document WT/TPR/S/317/Rev.1, 21 October 2015, Section 3.1.8.  
211 European Commission, The Goods Package: Reinforcing trust in the single marke t. COM(2017) 0787 
final, 19 December 2017.  
212 Regulation (EU) 2019/515 on the mutual recognition of goods lawfully marketed in another Member 
State and repealing Regulation (EC) No. 764/2008 . Viewed at. https://eur -lex.europa.eu/legal -
content/EN/TXT/HTML/?uri=CELEX:32019R0515&from=EN . WT/TPR/S/395 • European Union  
 
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  internal market for goods through more cooperation among national market surveillance authorities. 
This new regulation was adopted on 20 June 2019 as Regulation (EU) 2019/1020213 and partially 
repeals Regulation (EC) No. 765/2008. It provides for information -sharing mechanisms between 
national market surveillance authorities regarding  illegal products and ongoing investigations. It will 
also help national authorities improve checks on products e ntering the EU. Since 30% of goods in 
the EU are imported, the Regulation also provides for the reinforcement of inspections at ports and 
external borders.  
3.170.   Under the NLF , one of the  main task s of the Commission  is to bring harmonization legislation 
in line  with the reference provisions of Decision No. 768/2008/EC. The following directives and 
regulations were aligned with these reference provisions since the last Review: Medical devices – 
Regulation (EU) 2017/745; In vitro diagnostic medical devices – Regul ation (EU) 2017/746; 
Unmanned airc raft systems – Delegated Regulation (EU) 2019/945; Accessibility requirements for 
products and services – Directive (EU) 2019/882; and Fertilising products – Regulation (EU) 
2019/1009.  
3.171.   An NLF directive requires member Stat es to implement the legislation at national level within 
a set time-frame. This is expected to give more flexibility to the member States, as they can reflect 
the principles of the legislation within their own legal and administrative frameworks.  
3.172.   The alter native approach to product legislation in the EU (known as the "Old Approach "), 
where the authorities drew up detailed regulations containing all the required technical and 
administrative requirements for each type of product is still employed for certain products, such as 
motor vehicles. Other specific approaches to EU harmonization were developed in certain sectors 
(e.g. pharmaceuticals, chemicals, cosmetics, and construction products ), and tailored to their 
particular needs.  
3.173.   Other key regulatory elements  governed by the NLF are conformity assessment, product 
marking and accreditation.  Conformity assessment is carried out before the product is placed on the 
EU market. A manufacturer can only place a product on the EU market when it meets all the 
applicable  requirements. The Commission 's main objective is to help ensure that unsafe or otherwise 
non-compliant products do not find their way on to the EU market. The purpose of conformity 
assessment is to ensure consistency of compliance from design to productio n, and to allow 
acceptance of the final product. Conformity assessment procedures in the EU product legislation 
range from a self -certification examination and production quality control system, to a full quality 
assurance system, depending on the impact o f the product on the protection of public interest 
(health, safety, environment, etc.). Several pieces of EU legislation require the involvement of a 
notified body in the conformity assessment process.  
3.174.   Conformity assessment bodies that have been notified b y the national authorities in the 
member State of their establishment to provide conformity assessment prescribed by EU harmonized 
legislation are listed in the New Approach Notification and Designated Organizations (NANDO) 
information system.  
3.175.   To sell pro ducts in the EU -28 and in Norway, Liechtenstein and Iceland, foreign suppliers are 
required to apply CE marking if their product is covered by specific product legislation that provides 
for this. The CE marking is the manufacturer's declaration that a prod uct meets the requirements of 
the applicable EC directives. It is the responsibility of manufacturers both within and outside the EU 
to ensure that their products, where applicable, comply with the relevant directives before affixing 
the CE marking and pla cing the  product  the market in Europe.  
3.176.   Only products that fall within the scope of at least one of the NLF directives require the 
CE marking. The marking is addresse d primarily to the national control authorities of the member 
States, and its use simplifies the task of essential market surveillance of regulated products. The 
marking is not intended to include detailed technical information on the product214, but there mu st 
                                                
213 Regulation (EU) 2019/1020 on market surveillance and compliance of products . Viewed at: 
https://www.europeansources.info/record/regulation -eu-2019-1020-on-market -surveillance -and-compliance -
of-products/ . 
214 This detailed information should not appear ne xt to the CE marking, but rather on the declaration of 
conformity (which the manufacturer or authorized representative must be able to provide at any time, together 
with the products technical file), or the documents accompanying the product.  WT/TPR/S/395 • European Union  
 
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  be enough information to enable the inspector to trace the product back to the manufacturer or the 
local contact established in the EU.  
3.177.   Accreditation is the last level of public control in the EU conformity assessment system and 
is designed to ensure t hat conformity assessment bodies have the technical competence to carry 
out their duties. The European cooperation for Accreditation (EA) represent s the national 
accreditation bodies. Membership of the EA is open to the national accreditation bodies in cou ntries 
in the European geographical area that can demonstrate that they operate an accreditation system 
compatible with appropriate International Organization for Standardization  (ISO)/International 
Electrotechnical Commission ( IEC) standards and EU legal requirements.  
3.3.2.2   Institutional framework  
3.178.   The European standardization system is based on a unique system of privileged public -
private partnership between the Commission and the European Standardization Organizations 
(ESOs), reflecting the provisions of Regula tion (EU) 1025/2012. The three ESOs recognized in this 
regulation  are the European Committee for Standardization (CEN), the European Committee for 
Electrotechnical Standardization (CENELEC), and the European Telecommunications Standards 
Institute (ETSI).  
3.179.   The members of CENELEC and CEN include the national standards bodies (NSBs) of 
33 European countries, including all the member States of the EU, EFTA countries, and those 
countries candidates for EU membership that fulfil the membership criteria. It is a co ndition of 
membership of both CEN and CENELEC that at least 80% of European standards are adopted 
identically by each member.  
3.180.   ETSI's membership includes global industry players and NSBs. ETSI allows direct 
participation in its technical committees by busin esses, including non -EU companies that have 
interests in Europe, and its standards are freely available on its website.  
3.181.   The ESOs are the only organizations authorized to create European standards. As at 
September 2019, a total of 22,773 European standards had been created by CEN and CENELEC for 
products and services, of which 3,297 (about 15%) are defined as harmonized standards. In 
addition, as at July 2019, there were 20,131 standardization deliverables by ETSI (including 
standards, guides, and technical specifications).  
3.182.   Standards are created or modified by experts in technical committees or working groups. 
European standards are implemented as national standards by each of the 34 national members of 
CEN/CENELEC/ETSI and "conflicting national standards sh all be withdrawn", which results in a single 
standard for accessing the EU single market. CEN and CENELEC rules require that, when work is 
started on a European standard, a "standstill" procedure applies, and members cannot start or 
continue national work on the same subject. National standards' development must be reported at 
least annually by each NSB under Regulation (EU) 1025/2012 to provide transparency on national 
work programmes. In the case of harmonized standards, standstill and withdrawal are comp ulsory.  
3.183.   CEN and CENELEC standards are aligned with ISO and IEC  standards. Participation in 
international standards development is arranged by the NSB of each country via their membership 
of the ISO, the IEC, the CEN or the CENELEC.  
3.184.   In addition to the thr ee ESOs, the Commission  plays a role in standardization by funding 
participation in the standardization process by SMEs and non -governmental organizations  (NGOs) , 
such as environmental and consumer groups and trade unions. The Commission issues 
standardiza tion requests for harmonized standards in support of EU policy and legislation, and 
financially supports the work of the ESOs, but is not involved in the process of standard -setting, 
which is carried out by the ESOs. EU -funded research and innovation proje cts also make their results 
available to the standardization work of the standards -setting organizations.  
3.185.   In October 2018, the Commission identifie d a number of strategic priorities for European 
standardi zation in support of Union legislation and policies in the fields of ICT, climate, circular 
economy, defence, space and security , among others.  The 2019 Annual Union Work Programme for 
European standardization (AUWP) defines the key orientations for the future developments of this WT/TPR/S/395 • European Union  
 
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  partnership, including the  principle of inclusiveness.215 The 2020 Annual Union Work Programme for 
European standardization should be published before the end of 2019 in the EU's Official Journal.  
3.186.   Since the adoption of the Communication on European standards for the 21st century on 
1 June 2016, the Commission has worked closely with its partners from industry, public authorities, 
NGOs and academia to implement the initiatives proposed by the communication, including a 
governance cycle to strengthen the dialogue with the EU co -legislat ors, and the development of the 
Joint Initiative on Standardisation (JIS), signed on 13 June 2016.  It was officially terminated after 
three years of activities on 7 June 2019.216  
3.187.   The JIS, as foreseen under the Single Market Strategy, sets out an innovative way of 
achieving priorities through open public -private cooperation. It sets out a shared vision for European 
standardization in order to take steps to better prioritize and modernize the current system, as well 
as to strive for the timely delivery of stan dardization deliverables. It focuses, in particular, on the 
following key elements: promoting faster standards development, closing the gap between research 
priorities and European standardization, clearer prioritisation, and stronger international presenc e. 
3.188.   The participants of the JIS are the Commission; EU member States; EFTA countries; ESOs, 
CEN, CENELEC, and ETSI; NSBs; European industry also represented by several associations 
including SMEs; and societal stakeholders, i.e. representing environmental interests, trade unions 
and consumers. JIS activities include a wide range of actions, such as programmes for education in 
standardization, improvement standardization awareness in national public authorities, a pilot 
project on aiding the im plementation of the Construction Products Regulation (CPR) through 
standards, and another pilot project on the increased use of standards in public procurement.217  
3.189.   On 30 April 2019, the Commission published its recommendations for the EU 's next Strategic 
Agenda 2019 -24. CEN and CENELEC aim to enhance the competitiveness of European industries and 
contribute to the removal of barriers to trade in the global market. In 2018, their members identified 
specific priority countries and regions where standardization  cooperation could reinforce trade 
relations with Europe. This exercise was strengthened with the launch of a dialogue with the 
Commission to ensure that standardization priorities are coordinated and reflected in EU  trade 
agreements.  
3.190.   On 9 April 2019, CEN and CENELEC also launched the "Standards Build Trust " Declaration. 
It shows the extent to which European standardization shares the priorities identified by the 
Commission, and highlights the important contribution of European standardization in supporting  
the objectives of policy makers. In particular, the Declaration identifies five strategic priorities on 
which standards can provide effective support to European policymaking in the coming years. CEN 
and CENELEC will focus on: a harmonized single market; a competitive European industry ready to 
lead in international trade; trust in new technologies; enhanced innovation for Europe; and the 
sustainable development goals of the UN 2030 Agenda.218 
3.191.   The Industry Advisory Forum (IAF) was established in October 2018  to further strengthen 
engagement of industry in European standardization. The aim of the Forum, participated in by 
industry representatives, is to provide a platform for dialogue with industry to advise on key 
standardization strategic issues and ensure t hat standards provide an adequate response to market 
needs. In 2019 , the following standardization -relevant priorities were selected : fostering digital 
transformation; focusing on international aspects; improving the standardization process; 
establishing a  pilot project on the CPR; strengthening CEN and CENELEC -'s position on European 
priority policy topics (e.g. cybersecurity); aligning industries ' actions towards the E C with the ESO 's 
actions , to pass coherent messages; and addressing competition with standards developing 
                                                
215 European Co mmission, The annual Union work programme for European standardisation for 2019 . 
Viewed at: http://ec.europa.eu/transparency/regdoc/rep/1/2018/EN/COM -2018-686-F1-EN-MAIN -PART-1.PDF . 
216 The official brochure detailing the main deliverables can be found at European Commission, The Joint 
Initiative on Standardisation 2019 . Viewed at: https://ec.eu ropa.eu/docsroom/documents/35781 . 
217 European Commission, Summary of Actions from the Joint Initiative on Standardisation . Viewed at: 
https://ec.europa.eu/docsroom/documents/36321 ; and The Joint Initiative Standardisation 2019 . Viewed at: 
https://ec.europa.eu/docsroom/documents/35781 . 
218 CEN/CENELEC, On the Road to Sibiu: stand ards help implement the EU's Strategic Agenda 
2019-2024. Viewed at: https://www.cencenelec.eu/News/brief_News/Pages/TN -2019-030.aspx . WT/TPR/S/395 • European Union  
 
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  organisations (SDOs) consortia . The IAF will also  provide strategic input to governance to further 
guide the CEN -CENELEC Work Programme, feeding also into the AUWP . 
3.192.   After a careful process based on a set of criteria defined to ensure bala nced and due 
representation, the 16 Members of the IAF were selected from a pool of 36 nominees proposed by 
CEN and CENELEC members. The selection was also based on the expert 's particular experience and 
knowledge in relevant areas, such as electrical and industrial power grid s, the construction, steel, 
digital, and automotive industr ies, and civil aviation security . 
3.3.2.3   The role of standardization for digital technologies  
3.193.   The Commission recognizes the rapid evolution of technology and the role of new products 
and services, such as Internet of Things (IoT) or the Cloud, in market transformation. Therefore, 
it seeks to ensure that innovative state -of-the-art global information an d communications 
technology (ITC) specifications are used as enablers for growth and development. The 
standardization needs in support of EU policies are outlined in the annually -updated  Rolling Plan for 
ICT Standardization, published by the Commission. Th e 2019 version identifies 170 actions 
organized around four thematic  areas: key enablers, societal challenges, innovation for the single 
market, and sustainable  growth.219 
3.194.   Creating the right conditions for digital networks and services to flourish is one of the three 
pillars of the EU Digital Single Market Strategy. Standardiz ation is supporting it in 2019 by focusing 
on the IoT, big data, blockchain, cooperative intelligent transport systems and autonomous driving, 
eHealth, smart cities, accessibility, e -Government and artificial intelligence (AI). Good progress has 
been made in the harmoni zation of the 5G spectrum, and the first global 5G standards are now 
available, as foreseen in the 5G Action Plan. However, further work in global 5G standardi zation is 
needed in the next few years, notably  to promote investments in 5G networks supporting industrial  
applications. The planned European partnership on Smart Networks and Services under Horizon 
Europe is expected to be instrumental in driving this standardi zation agenda.  
3.195.   On 1 February 2018, the Commission  launched the EU Blockchain Observatory and Forum, 
whose  Working Group on Blockchain Policy and Framework Conditions aims to address, among 
others, issues on technological and ecosystem developments such as intero perability, where 
standardization could provide solutions.220 It also aims to identify any blockchain standardization 
needs at the EU level.  The Observatory and Forum has finalized five major thematic policy research 
reports on (i) blockchain s and digital id entity; (ii) scalability interoperability and sustainability of 
blockchains ; (iii) blockchain s for government public services; (iv) blockchain s and General Data 
Protection Regulation ( GDPR ); and (v) blockchain innovation in Europe.221  
3.196.   Identification of standards needs is also taking place in the area of AI. Since AI has a broad 
impact on the economy and society, the Commission believes it is necessary to prepare such 
products and services markets and ensure compliance with safety standa rds. The Commission set 
up a High -Level Expert Group (AI HLEG), which aims to serve as the steering group for the European 
AI Alliance's work. In the first year after its creation in June 2018, the AI HLEG delivered on the two 
items below .  
3.197.   The Ethics Guid elines on Artificial Intelligence put forward a human -centric approach on AI 
and list s seven  key requirements that AI  systems should meet in order to be trustworthy. These 
requirements will go through a pilot process , expected to conclude with the presenta tion of a revised 
document in early 2020. The document describes the potential role of standardi zation in the context 
of trustworthy AI assessment.  
3.198.   The Policy and Investment Recommendations  consist of  33 recommendations that can guide 
trustworthy AI toward s sustainability, growth , competitiveness, a nd inclusion , – while empowering, 
                                                
219 European Commission, 2019 Rolling Plan for ICT Standardisation . Viewed at: 
https://ec.europa.eu/docsroom/documents/34788 . 
220 European Commission,  Blockchain Technologies . Viewed at: https://ec.europa.eu/digital -single -
market/en/blockchain -technologies . 
221 Workshops were also organized bringing together a broad range of stakeholders from the EC, 
governments, industry associations, start -ups, the academi a and civil society organizations.  WT/TPR/S/395 • European Union  
 
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  benefiting and protecting human beings. The potential role of standardi zation in various aspects, 
such as innovation, data sharing, interoperability, and certification is also pa rt of this document . 
3.3.2.4   Standardization and climate change  
3.199.   Since 2013 , the Commission has been  implementing an EU Strategy on Adapt ation to 
Climate Change, setting out a framework and mechanisms for the EU's preparedness for current and 
future climate impacts  (Section 4.2). The Commission invited the ESOs to contribute to EU efforts 
to make Europe more climate -resilient. In 2018, the Commission  published an evaluation of the 
initial five years of the implementation of the Strategy , encompassing, among others, the progress 
on standardization.222 
3.200.   On a mandate from the Commission, the ESOs completed the first phase at the beginning 
of 2017 ; this resulted in a shortlist of 12 standards to be revised and 1 standard to be written under 
the second phase, which started a t the beginning of 2018 and is expected to take about four years. 
CEN-CENELEC will then consider whether the process should be extended to other standards. The 
technical committees are currently asking for more detailed information on climate change projec tion 
data. 
3.201.   The work included , among others,  the development of tailored guidance for the technical 
committees. The guidance is to  provide information on the availability and use of climate data, 
including recommendations for dealing with uncertainty, as well as  approaches for vulnerability 
assessment and adaptation based on best practices and experience gained during the project.223  
3.202.   In 2016, CEN and CENELEC developed and published a "Guide for addressing climate change 
adaptation in standar ds". The Guide is intended to help standard writers address the consequences 
and implications of climate change. It includes a simple checklist to help establish whether climate 
change adaptation is relevant to a particular standardization activity and a d ecision tree to help 
identify which actions should be taken.224  
3.203.   As regards the mitigation of climate change, the objective is that both the standards 
developed by ESOs (CEN/CENELEC/ETSI) and the legal minimum requirements in EU law work 
towards the reductio n of CO2 emissions. For instance, the EU Regulation on tyres labelling , which  
aims to improve fuel efficiency, safety and noise by providing better information to consumers when 
they buy tyres , relies on standards for measuring rolling resistance, wet grip  and noise .225  
3.3.2.5   Rapid Alert System for non -food dangerous products (RAPEX)  
3.204.   RAPEX enables the quick exchange of information between EU/EEA member states and the 
Commission  about dangerous non -food products posing a risk to the health and safety of consumers , 
as well as measures taken to address these risks.  
3.205.   Since the set -up of an information exchange tool about dangerous non -food products in 
2003, the System has continuous ly developed in terms of improved quality and efficiency. With a 
database containing more than 25 ,000 alerts and over twice as many follow -up reactions, this is a 
successful achievement resulting from more than 15 years of joint -cooperation between member 
States and the Commission. Since 2010, RAPEX  also covers professional products and products that 
pose risks other than those relating to health and safety, such as risks to the environment. In 2018, 
the authorities of the 31 participating countries exchang ed 2,257 alerts on dangerous products.   
3.206.   The national authorities have an obligation to follow up on the products circulated in RAPEX . 
After checking their own national markets, the y must take the necessary measures if they find the 
                                                
222 European Commission, EU Adaptation Strategy . Viewed at: 
https://ec.europa.eu/clima/policies/adaptation/what_en#tab -0-0. 
223 CEN/CENELEC, Climate Change . Viewed at:  
https://www.cencenelec.eu/standards/sectors/climatechange/pages/default.aspx . 
224 CEN/CENELEC, Climate Change . Viewed at:  
https://www.cencenelec.eu/standards/sectors/climatechange/pages/default.aspx . 
225 Other pieces of EU legislation imposing legal requirements for the energy efficiency of buildings 
(Energy Performance of Buildings Directive) and of products (Ecodesign Directive and Energy Labelling 
Regulation) (Section 4.2), similarly rely on measurement standards established by the ESOs.  WT/TPR/S/395 • European Union  
 
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  same products in their t erritory and send this information through the System. In 2018, 
4,050 follow -up reports in respect of original alerts were circulated. Underneath each alert published 
on the Safety Gate , it is possible to see which countries have followed up on that alert,  found the 
same dangerous product on their markets , and take n the necessary measures to stop, withdraw, or 
recall the product.  
3.207.   To improve the detection of dangerous products marketed in the EU before they are sold to 
consumers or as soon as possible therea fter, the Commission facilitated the signature of the Product 
Safety Pledge by four major online marketplaces ( i.e. Alibaba, Amazon, Ebay, and Rakuten France) 
on 25 June 2018. By signing the pledge, the se companies agreed to a list of commitments going 
beyond their legal obligations , with the aim of protecting consumers .226 
3.3.2.6   Technical Barriers to Trade (TBT)  Committee in the WTO  
3.208.   The EU and each member State notified enquiry points under the TBT Agreement. The  
Directorate -General for Internal Market, Industry, Entrepreneurship and SMEs (DG GROW) – 
former ly the Directorate -General for Enterprise and Industry (DG -ENTR) of the European 
Commission - is the EU  notification authority.227 
3.209.   In 201 7 and 201 8, the EU made 200 notifications to the TBT Committee in the WTO  under 
Article 10.6 to the TBT Agreement (176 in 2015 -16). In the first nine months of 2019, the EU made 
43 such notifications. In addition, individual EU member States submitted 82  notifications in 2017-18 
(56 in 2015 -16). The EU also submitted one notification under Article 10.7 regarding the Agreement 
between the E U and Chile on trade in organic products .228 
3.210.   During the review period, the TBT Committee received 13 new specific trade concerns 
regarding measures  taken by the EU or its member States: eco-design requirements for electronic 
displays ; chlorothalonil (pesticide active substance) ; transitional periods for minimum residue limits 
(MRLs) and international consultations ; organic production and labelling - maté (erva -mate) ; 
labelling requirements of the origin of grains used in the preparation of dried pasta ; non-renewal of 
approval of the active substance picoxystrobin ; titanium dioxide: Regulation (EC) No . 1272/2008 
(CLP R egulation), Annex VI, Part 2 ; amendments to Directive 2009/28/EC, Renewable Energy 
Directive ; application of Regulation No. 1169/2011 and Regulation (EC) No. 1924/2006 as regards 
the labelling of food products, in not prohibiting or examining the use of "p alm oil free" labels ; 
Regulation of the European Parliament and of the Council laying down rules and procedures for 
compliance with and enforcement of Union harmonization legislation on products and amending 
relevant regulations ; establishment and operatio n of a traceability system for tobacco products ; 
Radio Equipment Directive ; and l aws, regulations, procedures and guidelines on marketing 
authori zation for medicinal products .229 
3.211.   During the review period, Members also referred to nine concerns that had been raised 
earlier: protected designations of origin and geographical indications, traditional terms, labelling and 
presentation of certain wine sector s; quality schemes for agricul tural products and foodstuffs ; 
hazard -based approach to plant protection products and setting of import tolerances ; common 
criteria for information technology security evaluation (Common Criteria) certification in the EU ; 
Public Health (Alcohol) Bill 2015 ; Regulation on the Registration, Evaluation and Authorization of 
Chemicals (REACH) ; Restriction on Polycyclic Aromatic Hydrocarbons (PAHs) in tyres as specified in 
Annex XVII of REACH ; Directive 2014/40/EU on the approximation of the laws, regulations and 
administrative provisions of member States concerning the manufacture, presentation and sale of 
tobacco and related products and repealing Directive 2001/37/EC ; and country of origin labelling.230 
                                                
226 European Commission, Safety Gate: just a click to keep away from dangerous products . Viewed at:  
https://ec.europa.eu/consumers/consumer s_safety/safety_products/rapex/alerts/repository/content/pa
ges/rapex/reports/docs/RAPEX_2018_Report_en.pdf . 
227 WTO document G/TBT/ENQ/38/Rev.1, 8 July 2011.  
228 WTO document G/TBT/10.7/N/145, 8 August 2017.  
229 WTO database.  
230 WTO database.  WT/TPR/S/395 • European Union  
 
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  3.212.   The EU also used the TBT Committee to raise its own concerns regarding measures proposed 
or implemented by other WTO Members, notably in areas of foodstuffs and alcoholic beverages, 
cosmetics, medical devices, plastic products, ICTs and electronics, and tyres.231 
3.3.3   Sanitary and phytosanitary requirements  
3.213.   Since the last Review, the most significant change in the EU's SPS regime refers to the  new 
Regulation (EU) 2017/625 of the European Parliament and of the Council of 15 March  2017 regarding  
official controls on products of animal origin intended for human consumption. It includes  rules for 
the performance of official controls and other control activities by the competent authorities of the 
member States , sets out the requirements to be fulfi lled for the entry into the EU of consignments 
of animals and goods from third countries, and empowers the Commission to adopt delegated acts 
concerning those requirements.232 This Regulation will apply from 14 December 2019. However, the 
requirements will only apply from 21 April 2021.233  
3.214.   The new Regulation will replace Regulation (EC) No. 882/2004234 and repeal Regulation (EC) 
No. 854/2004.235 The key SPS legislation in the EU is summarized in Table 3.21.  
Table 3.21 Principal SPS legislation , 2019 
Legislation  Note  
Regulation (EC) No. 178/2002 of 
the European Parliament and of the 
Council of 28 January 2002 laying 
down the general principles and 
requirements of food law, 
establishing the European Food 
Safety Authority (EFSA) and laying 
down procedures in matters of f ood 
safety  The General Food Law.  
Regulates the safety of food and feed produced or consumed in the 
internal market; established a framework for controlling and monitoring 
the risks and their prevention and management ; and created the EFSA 
for the control a nd evaluation of food and feed. The a mendment of the 
Law by Regulation (EU) No. 2019/1381 of the European Parliament and 
the Council on the transparency and sustainability of the EU risk 
assessment in the food chain , amending Regulations (EC) 178/2002, 
1829/2003, 1831/2003, 2065/2003, 1935/2004, 1331/2008, 
1107/2009, Regulation (EU) 2015/2283 and Directive 2001/18/EC. 
Regulation (EU) 2019/1381 aim s to improve the transparency of the EU 
risk assessment process carried out by the EFSA, strengthen the long -
term sustainability of the EFSA, and improve risk communication.  
Regulation (EC) No. 852/2004 of 
the European Parliament and of the 
Council of 29 April 2004 on the 
hygiene of foodstuffs  General rules for food business operators on the hygiene of foodstuffs, 
putting primary responsibility on the operators ; implementation of 
procedures based on Hazard Analysis and Critical Control Point ( HACCP ) 
principles and good hygiene practice ; and ensuring that imported foods 
are at least the same  as, or equiva lent to, the hygiene standard s of food 
produced in the EU . 
Regulation (EC) No. 853/2004 of 
the European Parliament and of the 
Council of 29 April 2004 laying 
down specific hygiene rules for food 
of animal origin  Supplementing Regulation (EC) No. 852/2004.  
Setting out specific rules on hygiene for food of animal origin , for food 
business operators , and applying to unprocessed and processed 
products of animal origin . 
                                                
231 WTO database.  
232 A legislative act may delegate to the Commission the power to adopt non -legislative acts of general 
application to supplement or amend certain non -essential elements of a legislative act (Article 290 of the 
TFEU). Legal acts adopted by the Commission in t his way are referred to as "delegated acts" (Section 2.1).  
233 Requirements laid down in Articles 11, (13)(1) and 13(2) of delegated R egulation (EU) No. 
2017/625 . 
234 Regulation (EC) No. 882/2004 of the European Parliament and of the Council of 29 April 2004 o n 
official controls performed to ensure the verification of compliance with feed and food law, animal health and 
animal welfare rules. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=CONSLEG:2004R0882:20060525:EN:PDF . 
235 Regulation (EC) No. 854/2004 of the European Parliament and of the Council of 29 April 2004 laying 
down specific rules for the organization of official controls on produ cts of animal origin intended for human 
consumption. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2004:226:0083:0127:EN:PDF . WT/TPR/S/395 • European Union  
 
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  Legislation  Note  
Regulation (EC) No. 854/2004 of 
the European Parliament and of the 
Council of 29 April 2004  laying 
down specific rules for the 
organization of official controls on 
products of animal origin intended 
for human consumptiona Setting out specific rules on the organization of official controls on 
products of animal origin intended for human consumpti on.  
The Regulation applies in addition to Regulation (EC) No. 882/2004 . 
Regulation (EC) No. 882/2004 of 
the European Parliament and of the 
Council of 29 April 2004 on official 
controls performed to ensure the 
verification of compliance with feed 
and food  law, animal health and 
animal welfare rulesa On official controls for verification of compliance with feed and food law, 
animal health, and animal welfare rules. The Regulation sets out general 
rules for the performance of official controls to verify comp liance with 
rules aiming, in particular, at: (a) preventing, eliminating or reducing to 
acceptable levels risks to humans and animals, either directly or 
through the environment; and (b) guaranteeing fair practices in  the 
feed and food trade , and protecting consumer interests, including feed 
and food labelling and other forms of consumer information . 
Regulation (EU)  2017/625 of the 
European Parliament and of the 
Council of 15 March 2017 on official 
controls and other offi cial activities 
performed to ensure the application 
of food and feed law, and rules on 
animal health and welfare, plant 
health  and plant protection 
products (Official Controls 
Regulation)  On official controls for the verification of compliance with  the feed and 
food law, and rules on animal health and animal welfare rules, plant 
health  and plant protection products .  
It amends Regulations (EC) No . 999/2001, (EC) No . 396/2005, 
(EC) No. 1069/2009, (EC) No . 1107/2009, (EU) No . 1151/2012, 
(EU) No. 652/2014, (EU ) No. 2016/429 and (EU) No. 2016/2031 of the 
European Parliament and of the Council, Council Regulations (EC) 
No. 1/2005 and (EC) No . 1099/2009 and Council Directives  
No. 98/58/EC, No. 1999/74/EC, No. 2007/43/EC, No. 2008/119/EC and 
No. 2008/120/EC, and repeals Regulations (EC) No . 854/2004 and (EC) 
No. 882/2004 of the European Parliament and of the Council, Council 
Directives No. 89/608/EEC, No. 89/662/EEC, No. 90/425/EEC, 
No. 91/496/EEC, No. 96/23/EC, No. 96/93/EC and No. 97/78/EC and 
Council Decision No. 92/438/EEC (Official Controls Regulation) . 
Directive  2002/99/EC of 
16 December 2002 laying down the 
animal health rules governing the 
production, processing, distribution 
and introduction of products of 
animal origin for human 
consumptionb, c Setting out rules for the production, processing, distribution, and 
introduction of products of animal origin for human consumption. The 
Directive lays down the general animal health rules governing all stages 
of the production, processing and distribution  within the EU and the 
introduction from third countries of products of animal origin and 
products obtained therefrom intended for human consumption . 
Regulation (EU)  2016/429 of the 
European Parliament and of the 
Council of 9 March 2016 on 
transmissible a nimal diseases , 
amending and repealing certain 
acts in the area of animal health 
(Animal Health Law)  Repeal of Council Directive s 64/432/EEC, 77/391/EEC, 78/52/EEC, 
80/1095/EEC, 82/894/EEC, 88/407/EEC, 89/556/EEC, 90/429/EEC, 
91/68/EEC, 92/35/EEC, 92/65/EE C, 92/66/EEC, 92/118/EEC, 
92/119/EEC , 2000/75/EC , 2001/89/EC, 2002/60/EC , No. 2002/99/EC , 
and 2003/85/EC ; Council Decision s 91/666/EEC, 95/410/EC , and 
2000/258/EC ; Council Regulation (EC) 21/2004 , Council Directives 
2004/68/EC, 2005/94/EC , 2006/88/EC, 2008 /71/EC, 2009/156/EC, and 
2009/158/EC , and Regulation (EU) 576/2013 of the European 
Parliament and of the Council . Inter alia,  the Law consolidates animal 
health legislation and aims to simplify and clarify the rules relating to 
the prevention and eradicati on of diseases . 
Regulation (EU)  2016/2031 of the 
European Parliament of the Council 
of 26 October 2016 on protective 
measures against pests of plants, 
amending Regulations (EU) 
228/2013, (EU) 652/2014 and (EU) 
1143/2014 of the European 
Parliament and of t he Council and 
repealing Council Directives 
69/464/EEC, 74/647/EEC, 
93/85/EEC, 98/57/EC, 2000/29/EC, 
2006/91/EC and 2007/33/EC  Repeal of Directive  2000/29/EC . 
Protective measures against the introduction of organisms which are 
harmful to plants or plant pr oducts . 
Regulation (EU) 2019/4 of the 
European Parliament and of the 
Council of 11 December 2018 on 
the manufacture, placing on the 
market and use of medicated feed  Amending Regulation (EC) No . 183/2005 of the European Parliament 
and of the Council and repealing Council Directive No. 90/167/EEC . 
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  Legislation  Note  
Regulation (EU) 2019/6 of the 
European Parliament and of the 
Council of 11 December 2018 on 
veterinary medicinal products, 
repealing Directive 2001/82 /EC This Regulation sets up an up -to-date legal framework for the 
authorization, distribution and use of veterinary drugs in the EU, and 
strengthens the fight against antimicrobial resistance (AMR). It will 
apply from 28 January 2022.  
a To be replaced by Regulation  (EU) 2017/625 , which will apply from 14 December 2019.  
b In addition to Directive  2002/99/EC, there are many other legislative acts in the EU relating to 
animal health (see the directives repealed by Regulation (EU)  2016/429).  
c To be replaced b y Regulation  (EU) 2016/429 which will apply from 21 April 2021 . 
Source:  European Commission  and Eur -Lex. Access to European Union law . Viewed at:  http://eur -
lex.europa.eu/homepage.html . 
3.215.   Transitional measures are laid down for the entry into the EU of certain food until 
31 December  2020, in accordance with Commission Delegated Regulation No. 2017/185. The 
requirements set out in this Regulation consi st of a three -tiered system of guarantees:  
• requirements for the listing of third countries /regions authori zed for imports of food into the 
EU. Third countries , or regions in these third countries , are included in those lists through 
an implementing regula tion in accordance with Article 127 of Regulation (EU)  2017/625;  
• the requirement that consignments of certain animals and goods from third countries must 
be dispatched from, and obtained or prepared in , establishments which comply with relevant 
requirement s referred to in Article 1(2)(a) of Regulation (EU)  2017/625, or with 
requirements recogni zed to be at least equivalent thereto and listed in accordance with this 
Regulation; and  
• the requirement that consignments be accompanied by appropriate official cert ification 
confirming their compliance with relevant requirements applicable in the EU.  
3.216.   Additional specific import requirements for bivalve molluscs, fishery products and composite 
products were also included. The import requirements laid down in this Regulation consider  (as do 
the existing rules laid down in Regulation (EC) No . 854/2004) the specific characteristics of certain 
products. They also consider  the need for greater flexibility when certain products pose a lower level 
of risk to public and animal health.  
3.217.   The Animal Health Law of 2016 is to become applicable on 21 April 2021 , and the Plant 
Health Law of 2016 on 14 December 2019, except for the provisions relating to a phytosanitary 
certificate for exports (from 1 January 2021) . In the meantime, several measures are to be adopted 
by the Commission to implement  the new rules.   
3.218.   The Commission  is responsible for developing draft proposals for implementing acts. The 
Standing Committee on Plants, Animals, Food and Feed (PAFF Committee) is the principal regulatory 
body responsible for delivering opinions on draft implementing measures. The Committee is made 
up of 14  different sections, each of which is responsible for different aspects related to SPS 
measures.236 In addition, five other committees are also responsible for specific SPS -related issues:  
• Regulatory Committee under Directive  2001/18/EC on the deliberate release into the 
environment of genetically modified organisms  (GMOs);  
• Regulatory Committee under Directive  2009/41/EC on the contained use of GMOs ; 
• Standing Com mittee on Plant Variety Rights;  
                                                
236 General Food Law, Biological Safety of the Food Chain, Toxicological Safety of the Food Chain, 
Controls and Import Conditions, Animal Nutrition, Animal Health and Animal Welfare, Genetically Modified Food 
and Feed and Environmental Risk, Phytopharmaceutical s, Plant Health, Propagating Material of Ornamental 
Plants, Propagating Material and Plants of Fruit Genera and Species, Seeds and Propagating Material for 
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  • Standing Committee on Zootechnics; and  
• Biocidal Products Committee.  
3.219.   The EFSA, established under the General Food Law of 2002, is an independent agency 
responsible for risk assessment for food and feed safety, nutrition, anim al health and welfare, plant 
protection, and plant health, as well as, through environmental risk assessments, the possible impact 
of the food chain on biodiversity.237 The Health and Food Audits and Analysis Directorate (formerly 
known as the Food and Veter inary Office (FVO)) of the Commission is responsible for audits, 
inspections, and related activities , to assess compliance with EU food safety and quality, animal 
health and welfare, and plant health legislation within the EU, and compliance with EU import  
requirements in third countries exporting to the EU.  
3.220.   The Commission's Trade Control and Exp ert System (TRACES) is an online system which 
manages official controls and route planning for imports of animals, semen and embryos, food, feed 
and plants which mu st be accompanied by health certificates and/or trade documents. All 
harmonized certificates for exporting to the EU are available on TRACES which is used to notify the 
relevant authorities in the importing member State of the arrival of a consignment.238 
3.221.   To a large extent, SPS measures in the EU have been harmonized, and most measures are 
taken at the EU level. Nonetheless, member States may, and sometimes do, take specific measures 
in the absence of harmonized EU requirements.  
3.222.   EU member States are members o f the Codex Alimentarius Commission, and the World 
Organization for Animal Health (OIE), and are contracting parties to the International Plant 
Protection Convention (IPPC). The EU itself is a member of Codex and a contracting party to the 
IPPC.  
3.3.3.1   Plants and  plant products  
3.223.   No major changes were introduced regarding plants and plant products since the last Review. 
Regulation (EU) 2016/20 31 on protective measures against plant pests extends the definition of 
pests to include non -parasitic plants that could have  a severe economic, social, or environmental 
impact within the EU . It will apply as from 1 4 December 2019 .239 
3.224.   Regulation (EU) 2016/20 31 classifie s all pests in to three categories: regulated non -
quarantine pests, protected -zone quarantine pests , and union quarantine pests, among which those 
with the most severe impacts would be tagged as "priority pests".  It also introduce s a new concept 
of "high risk plants, plant  products and other objects", whose import would be prohibited until a 
thorough risk assessment is carried out. Temporary import restrictions could be introduced if there 
is insufficient experience in terms of trade , or if the risks are still unknown. For the importation of 
living plant material, the E U would request that phytosanitary certificates attest compliance with 
EU legislation.240  
3.225.   As from 14 December 2019, all plants (including living parts of plants) will need to be 
accompanied by a phytosanitary c ertificate to enter into the EU, unless they are listed in Commission 
Implementing Regulation (EU) 2018/2019  as exempted from this general requirement. Current ly, 
the list of exempted plants are the following: pineapples, coconuts, durians, bananas and dates.  
3.226.   Provisions within Regulation (EU) 2016/20 31 are in place for the listing of "high risk plants, 
plant products and other objects" (Article 42) , based on a s cientific preliminary assessment by the 
EFSA. Commission Implementing Regulation (EU) 2018/2019  establishes the list of high -risk plants  
the introduction of which into the EU territory will be provisionally prohibited from 
14 December  2019 until a full risk assessment has been carried out.  
                                                
237 EFSA. Viewed at: http://www.efsa.europa.eu/ . 
238 European Commission, TRACES: TRAde Control and Expert System . Viewed at: 
http://ec.europa.eu/food/animals/traces_en . 
239 WTO document G/SPS/N/EU/44/Add.2, 26 January 2017.  
240 WTO document G/SPS/GEN/1541, 10 March 2017.  WT/TPR/S/395 • European Union  
 
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  3.227.   Under the currently applicable legislation on trade in plants and plant products 
(Directive  2000/29/E C)241, a phytosanitary certificate from the competent authorities in the 
exporting country is required for plants for planting, some fruits, vegetables, seeds and cut flowers. 
Once in the EU, a plant passport may replace the phytosanitary certificate. Import s into the EU of 
most plants and plant products from most countries do not require prior approval or notification, 
although they are subject to rules on food safety and customs procedures and inspection. The 
competent authorities in the member States must be notified of imports of some food and feed 
products of non -animal origin from specified third countries which must enter the EU through 
designated points of entry where they are subject to additional controls.242 The list of products and 
exporting countrie s is reviewed quarterly.  
3.228.   The procedure for approving GMOs has not changed. An application for approval for use of 
a GMO for food, feed, cultivation, or release on the market for other purposes (e.g. cut flowers) 
must be made to the competent authority in a  member State. The EFSA, in collaboration with the 
member States' scientific bodies, conducts a risk assessment and delivers an opinion. On the basis 
of the opinion, the Commission prepares draft legislation to grant or refuse authorization. Directive 
(EU) 2015/412 gives member States more flexibility to restrict or prohibit the cultivation of a GMO 
in their territory , either during the authorization procedure, by demanding to exclude their territory 
from the geographical scope of the application, or, after  authorization has been granted, by adopting 
measures that prohibit or restrict cultivation of specific GMOs.243 The Commission also proposed a 
review of the decision -making process on GMOs  to allow member States to restrict or prohibit the 
use, in part or a ll of their territory, of GM food and feed authorized at EU level for compelling reasons 
other than the risk to human or animal health or to the environment.244 
3.229.   As at the end of September 2019, 1 GMO was approved for cultivation (with ongoing 
procedures for renewal of authorization) and 139 for food and feed uses. In addition, 2 applications 
(excluding the ongoing renewal) for cultivation and 51 for food and feed uses were pending. S ix GMO 
flowers are also approved for sale in the EU.  
3.3.3.2   Live animals and animal products  
3.230.   The Animal Health Law will apply from 21 April  2021. It provides for new animal health 
requirements for entry into the EU of animals and their products, but it does not make significant 
changes to the existing system.  Under the currently applicabl e legislation, to export live animals and 
germinal  products, products of animal origin for human consumption, animal by -products and 
derived products to the EU, the competent authority of the exporting country must be recognized as 
being able to "ensure cr edible inspection and controls throughout the production chain, which cover 
all relevant aspects of hygiene, animal health and public health" and provide adequate guarantees.245 
In addition, the country of origin must: be authorized , i.e. listed for entry into the EU  for the specific 
species of animals or animal products; and, where appropriate, have an approved residue plan for 
the relevant animal species, a Salmonella control programme for poultry and poultry products, and 
meet other requirements de pending on the animal and/or product.  
3.231.   At the request of the supplying country, the EU normally audits the country to ensure that 
all the criteria provided for in the EU legislation are met. Based on the results of the audit, the 
country may then be added t o the list of countries authorized for entry into  the EU. Depending on 
the animal health situation within a country, products from part of a country may be authorized for 
entry into  the EU, or different parts of a country may face different requirements. A dditions to the 
                                                
241 Council Directive 2000/29/EC of 8 May 2000 on protective measures against the introduction into the 
Community of organisms harmful to plants or plant products and against their spread within the Community.  
242 Commission Regulation (EC) No. 669/2009 of 24 J uly 2009 implementing Regulation (EC) 
No. 882/2004 of the European Parliament and of the Council as regards the increased level of official controls 
on imports of certain feed and food of non -animal origin and amending Decision 2006/504/EC.  
243 Directive (EU ) 2015/412 of the European Parliament and of the Council of 11 March 2015 amending 
Directive 2001/18/EC as regards the possibility for member States to restrict or prohibit the cultivation of 
GMOs in their territory.  
244 Commission Proposal for a Regulation of the European Parliament and of the Council amending 
Regulation (EC) 1829/2003 as regards the possibility for member States to restrict or prohibit the use of 
genetically modified food and feed on their territory.  
245 European Commission (2010), General gu idance on EU import and transit rules for live animals and 
animal products from third countries , SANCO/7166/2010.  WT/TPR/S/395 • European Union  
 
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  list of approved third countries, territories, zones, or compartments are made through amendments 
to the relevant legislation following approval of a Commission  proposal by the PAFF Committee.  
3.232.   In addition, an establishment in a third countr y wishing  to export to the EU products of 
animal origin for human consumption and animal by -products  must be added to the list of eligible 
exporters. It must inform its national authorities, which may then make a request to the  Commission , 
after they have verified that production in the establishment is compliant with, or equivalent to, the 
requirements laid down in the EU legislation.  
3.233.   Entry into the EU  of live animals and animal products must be accompanied by a health 
certificate issued by the competent a uthorities of the exporting country, stating that the animals or 
products meet EU import requirements. Before their arrival on EU territory, the approved Border 
Inspection Post (BIP)246 of arrival must be notified through TRACES (at least 24 hours before arr ival 
for live animals) using the Common Veterinary Entry Document (CVED). At the BIP, the consignment 
must undergo official controls, including documentary, identity, and physical checks, which may 
include laboratory tests. Depending on the risks associate d with the animal product concerned, 
physical checks may be reduced.247  
3.234.   As from 14 December 2019, under the new Official Controls Regulation (OCR), the BIPs will 
be changed to Border Control Posts (BCPs), the CVED to the Common Health Entry Document 
(CHED),  and TRACES to the Information Management System for Official Controls (IMSOC).248 
3.235.   Where a recurrent problem is identified with a specific animal product from a third country, 
special import conditions may be applied, such as reinforced testing or pre -export testing in the 
country of origin.249 
3.3.3.3   Rapid Alert System for Food and Feed  (RASFF)  
3.236.   The RASFF allows food and fe ed authorities of the member States and the Commission to 
exchange information about measures taken in response to direct and indirect risks to human health 
from food, and human and animal health and the environment from feed.250 Member States notify 
risks d etected in products already on the market (market notifications) and when products are 
refused entry into the EU (border rejections).251 
3.237.   During the review period, there was a significant rise in notifications transmitted through 
the RASFF, notably in alert n otifications. T he number of border rejections that had been declining in 
recent years also grew  substantially  in 2017 but declined again in 2018 . A total of 3 ,687 original 
notifications  were reported in 2018 (28% decrease compared to 2017) , of which 1,118  were 
classified as alert s, 493 as information for follow -up, 675 as information for attention , and 1,401  as 
border rejection notification s (Table 3.22) . These original notifications gave rise to 9 ,117 follow -up 
notifications  in 2017 (25% more than in 2016) , an average of 2.4 follow -ups per original notification. 
For alert notifications , this average rose to 6.1 follow -ups per original notification. Compared to 
2016, the number of alert notifications, implying a serious health  risk of a product circulating on the 
market, rose by 11% , with 24% more follow -ups transmitted.  
                                                
246 European Commission Decision of 28 September 2009 drawing up a list of approved BIPs, laying 
down certain rules on the inspections carried o ut by Commission veterinary experts and laying down the 
veterinary units in TRACES (notified under document COM(2009) 7030 final, 28 September 2009).  
247 Commission Decision No. 94/360/EC of 20 May 1994 on the reduced frequency of physical checks of 
consignm ents of certain products to be implemented from third countries, under Council Directive 
No. 90/675/EEC.  
248 European Commission, Official Controls Regulation: A new framework for better and integrated 
controls for animals, food and feed in the EU . Viewed at : 
https://ec.europa.eu/food/sites/food/files/safety/docs/comm_oc_20181010_pres -01.pdf . 
249 European Commission, Special Import Conditions . Viewed at: http://ec.europa.eu/food/animals/vet -
border -control/special -import -conditions_en . 
250 Regulation (EC) No. 178/2002 (General Food Law), Article 50.  
251 European Commission.  RASSF Portal . Viewed at: https://ec.europa.eu/food/safety/rasff/portal_en . WT/TPR/S/395 • European Union  
 
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  Table 3.22 RASFF notifications, 201 2-19 
Year Alerta Border 
rejectionb Information for 
attentionc Information fo r 
follow -upd 
Original notification      
2012 522 1,712  679 507 
2013 584 1,438  679 429 
2014 725 1,357  605 402 
2015 748 1,376  475 378 
2016 817 1,159  573 372 
2017 927 1,570  683 586 
2018 1,118  1,401  675 493 
2019 (Jan -Sep) 807 1,103  624 404 
Follow -up notification      
2012 2,312  906 664 1,325  
2013 2,376  525 763 1,493  
2014 3,280  581 670 1,377  
2015 4,028  417 538 1,222  
2016 4,659  421 704 1,504  
2017 5,781  771 979 1,586  
2018 .. .. .. .. 
2019 (Jan -Sep) .. .. .. .. 
.. Not available.  
a Alert notifications are sent when food or feed presenting a serious health risk is on the market , and 
when rapid action is required.  
b Border rejections concern food and feed consignments that have been tested and rejected at the 
external borders of the EU ( or the EEA) when a health risk has been found.  
c Information notifications for attention relate to a product that is present only in the notifying 
member country, or has not been placed on the market, or is no longer on the mark et. 
d Information notifications for follow  up relate to a product that is, or may be, placed on the market in 
another member country.  
Source:  RASFF - The Rapid Alert System for Food and Feed - 2017 Annual Report,  Publications Office of the 
EU, p. 3 8; and i nformation provided by the European Commission . 
3.3.3.4   SPS Committee in the WTO  
3.238.   The EU and each member State notified enquiry points under the SPS Agreement.252 The 
Directorate -General for Health and Food Safety (DG SANTE) of the European Commission is the 
EU notification authority.253 
3.239.   In 201 7 and 201 8, the EU made a total of 153 notifications to the Committee on Sanitary 
and Phytosanitary Measures in the WTO  (107 in 2015 -16). In addition , in 2017 -18, Finland made 
one regular notification; France made two emergency  notifications; and S pain made two regular 
notification s.254 In the first nine months of 2019, the EU had made  108 notifications.  
3.240.   During the review period , WTO Members used the SPS Committee to raise  11 new specific 
trade concerns about measures taken in the EU or a member State : EU non-recognition of 
regionalization for Avian Influenza; France's dimethoate -related restrictions on imports ; EU MRLs for 
acrinat hrin, metalaxyl and thiabendazole ; EU maximum level of cadmium in foodstuffs ; 
EU restrictions on poultry meat due to Salmonella detection ; EU Commission Decision 2002/994/EC 
on animal products ; EU restrictions on poultry meat preparations (Regulation (EU) No. 2018/700); 
EU review of legislation on veterinary medicinal products ; new EU definition of the fungicide folpet ; 
EU MRLs for buprofezin, diflubenzuron, ethoxysulfuron, ioxynil, molinate, picoxystrobin and 
tepraloxydim ; and CJEU  Opinion 528/16 on organisms obtained by mutagenesis .  
3.241.   During the review period, WTO Members also referred to two concerns that had been raised 
previously: application and modification of the EU regulation on novel foods; and EU's revised 
                                                
252 WTO document G/SPS/ENQ/16, 11 March 2011.  
253 WTO document G/SPS/NNA/16, 11 March 2011.  
254 See WTO documents G/SPS/N/FIN/2, 6 April 2017; G/SPS/N/FRA/13, 31 May 2017; 
G/SPS/N/FRA/14, 4 May 2018; and G/SPS/N/ESP/5, 12 February 2018.  WT/TPR/S/395 • European Union  
 
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  proposal for cate gorization of compounds as endocrine disruptors. The EU used the Committee to 
raise its concerns in 11 cases over the same period.255 
3.242.   As part of the fifth Review of the Operation and Implementation of the SPS Agreement, the 
EU identified regionalization (pes t- and disease -free areas) as an issue that requires the Committee's 
continuing attention.256 
3.3.4   Competition policy  
3.243.   During the period under review, the existing competition policy regime of the EU and its 
member States was further consolidated. The main legisla tive basis of EU competition law and 
regulation remained unchanged (Table 3.23 ).257 In an important development, the competences of 
national competition authorities were strengthened through the adoption of a Directive to empower 
them.258 The Directive highlig hts their role in enforcing EU competition law, as well as the importance 
of independence and of sufficient resources for effective investigation of cases. In addition, it sets 
out the powers of competition authorities in conducting inspections and intervi ews, and ordering 
interim measures, etc. The European Competition Network (ECN), which was established in 2004259, 
continued to unite national competition authorities within a single network , thus ensuring similar 
application of competition norms in all member States. In that framework, national competition 
authorities participate as independent and equal entities endowed with powers in the competition 
area that are parallel to the competences of the Commission.260  
3.244.   To make communication with external stakehold ers more efficient, the Commission launched 
eTrustEx, a tool through which the entities can submit complaints, drafts of remedies in merger 
cases, responses to requests for information, etc. The user guide, published in May 2019, provides 
a detailed descri ption of the steps to be undertaken to submit the documents.261 
3.245.   The Commission also organizes training for national judges in the area of competition law, 
thus contributing to the coherent application of EU competition law by national courts. Topics include,  
but are not limited to, general training on enforcing competition law, damage actions for competition 
infringements , and interaction of IP and competition law.262 
3.246.   The Commission adopted Working Arrangements for the functioning of the Advisory 
Committee on R estrictive Practices and Dominant Positions , to facilitate cooperation with national 
competition authorities.263 The Advisory Committee is to be consulted prior to taking decisions  under 
Articles 7, 8, 9, 10, 23, 24(2) and 29(1) of Regulation 1/2003; for the sector inquiries; and on draft 
regulations. The Committee is comprised of representatives of competition authorities of member 
States. In light of the General Data Protection Re gulation (GDPR) of 2016264, in the reporting period , 
the Commission adopted a decision on handling personal data in relation to the provision of 
                                                
255 WTO SPS IMS database. Viewed at: http://spsims.wto.org/ . 
256 WTO document G /SPS/W/298, 4 June 2018.  
257 The legislation of the EU related to competition policy was analysed in detail during the previous 
Review. WTO document WT/TPR/S/357/Rev.1, 13 October 2017.  
258 Directive (EU) 2019/1 of the European Parliament and of the Council of  11 December 2018 to 
empower the competition authorities of the Member States to be more effective enforcers and to ensure the 
proper functioning of the internal market. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019L0001&from=EN . 
259 Commission Notice on cooperation within the Network of Competition Authorities. Viewed at: 
https://eur -lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:20 04:101:0043:0053:EN:PDF . 
260 The ECN itself is not an autonomous legal entity, and does not have enforcement competences.  
261 European Commission, User Guide: eTrustExchange . Viewed at: 
http://ec.europa.eu/competition/contacts/etrustex_user_guide.pdf . 
262 European Commission, Training of national judges and judicial cooperation in the field of EU 
competition law . Viewed at: http://ec.europa.eu/competition/court/training.html . 
263 European Commission, Annex to the Communication to Commission, Working Arrangements for the 
Functioning of the Advisory Committee on Restrictive Practices and Dominant Positions . Viewed at: 
https://ec.europa.eu/competition/antitrust/legislation/cooperation_nca.pdf . 
264 Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on  the 
protection of natural persons with regard to the processing of personal data and on the free movement of such 
data, and repealing Directive 95/46/EC (General Data Protection Regulation). Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32016R0679&from=EN . WT/TPR/S/395 • European Union  
 
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  information to data subjects and the restriction of certain rights.265 According to the Commission, 
the Decision  "ensures the balance between the rights of the data subjects and the efficiency of 
competition investigations".266 
3.247.   In October 2018, the Commission commenced the review of the Vertical Block Exemption 
Regulation (VBER), which will expire in May 2022.267 In order to decide whether the VBER should be 
amend ed, prolong ed or lapsed, the Commission  is conducting an evaluation of the functioning of the 
existing rules. For this purpose, it is currently  collect ing information on the efficiency, effectiveness, 
relevance, co herence and added value of the VBER and the  accompanying  Guidelines on Vertical 
Restraints . In this context, s takeholder s' comments on the Evaluation Roadmap, published in 
November 2018,  were collected until  6 December 2018; and a public consultation took place between 
4 February 2019 and 27 May 2019.268 The Commission published a factual summary of the 
contributions received in July 2019.269 An evaluation support study , carried out by independent 
contractors , was launched by the Commission at the beginning of August 2019. The study is 
expected to be completed by April 2020 . The evaluation phase will end with the publication by the 
Commission of a Staff Working Document , which is planned for the second quarter of 2020.   
3.248.   The European Parliament was also active in discussing issues related to competition, and 
published its usual annual reports on competition policy. The last such report was adopted as a 
resolution dated 31 January 2019.270 The report sets out recent  developments in EU competition 
policy and enforcement, welcoming Commission actions and calling for specific steps to tackle 
challenges. It highlights the importance of international cooperation, inter alia,  through international 
forums such as the OECD, the WTO and UNCTAD, and welcomes the efforts to reform the WTO.  
Table 3.23 Competition policy legislative framework – selected rules  
Rule Note  
TFEU  
Article 101  Prohibits agreements between two or more independent 
market operators that restrict competition  
Article 102  Prohibits firms holding a dominant position in a relevant 
market from abusing that position  
Article 105  The Commission may undertake investigations and make 
decisions, upon request by a member State or on its own 
initiative, concerning possible violations of the TFEU rules on 
competition policy. Such decisions may be appealed to the 
CJEU 
Article 106  Limited exceptions to the Treaty competition rules for 
undertakings required to operate services of general economic 
interest  
Regulations and directives  
Council Regulation (EC) No. 1/2003 of 
16 December 2002  On the implementation of the rules on competi tion laid down 
in Articles 81 and 82 of the EC Treaty (now Articles 101 and 
102 of the TFEU)  
Council Regulation (EC) No. 139/2004 of 
20 January 2004  On the control of concentrations between undertakings (the 
EC Merger Regulation)  
Directive 2014/104/EU of the European 
Parliament and the Council of 
26 November 2014  On certain rules governing actions for damages under national 
law for infringements of the competition law provisions of the 
member States and of the EU  
                                                
265 Commission Decision (EU) 2018/1927 of 5 December 2018 laying down internal rules concerning the 
processing of personal data by t he European Commission in the field of competition in relation to the provision 
of information to data subjects and the restriction of certain rights. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32018D1927&from=EN . 
266 European Commission, Competition: Data Protection . Viewed at: 
http://ec.europa.eu/competition/general/data_protection_en.html . 
267 European Commission, Antitrust: What's new?  Viewed at: 
http://ec.europa.eu/competition/antitrust/news.html . 
268 European Co mmission, Review of the Vertical Block Exemption Regulation . Viewed at: 
http://ec.europa.eu/competition/consultations/2018_vber/index_en.html . 
269 European Commission, Fact ual summary of the contributions received in the context of the open 
public consultation on the evaluation of the Vertical Block Exemption Regulation (EU) No. 330/2010. Viewed at: 
https://ec.europa.eu/competition/consultations/2018_vber/factual_summary.pdf . 
270 European Parliament, Resolution of 31 January 2019 on the Annual Report on Competition Policy . 
Viewed at: http://www.europarl.europa.eu/doceo/document/TA -8-2019-0062_EN.docx . WT/TPR/S/395 • European Union  
 
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  Rule Note  
Commission Regulation 773/ 2004/EC of 
7 April 2004  Relating to the conduct of proceedings by the Commission 
pursuant to Articles 81 and 82 of the EC Treaty  
Commission Regulation (EU) No. 330/2010 
of 20 April 2010  On the application of Article 101(3) of the TFEU to categories 
of vertical agreements and concerted practices  
Commission Regulation (EU) No. 316/2014 
of 21 March 2014  On the application of Article 101(3) of the TFEU to categories 
of technology transfer agreements  
Commission Implementing Regulation (EU) 
No. 1269/2013 of 5 December 2013  Amending Regulation (EC) No. 802/2004 implementing 
Council Regulation (EC) No. 139/2004 on the control of 
concentrations between undertakings  
Regulation (EU) 2018/302 of the European 
Parliament and of the Council of 
28 Febru ary 2018  Addressing unjustified geo -blocking and other forms of 
discrimination based on customers' nationality, place of 
residence or place of establishment within the internal market  
Directive (EU) 2019/1 of the European 
Parliament and of the Council of 
11 December 2018  Empowering the competition authorities of the member States 
to be more effective enforcers and to ensure the proper 
functioning of the internal market  
Other  
Communication from the Commission  
OJ 2011/C 11/01  Guidelines on the applicability of Article 101 of the TFEU to 
horizontal cooperation agreements  
Communication from the Commission  
OJ 2014/C 89/03  Guidelines on the application of Article 101 of the TFEU to 
technology transfer agreements  
Communication from the Commission  
OJ 2006/C 210/02  Guidelines on the method of setting fines imposed pursuant to 
Article 23(2)(a) of Regulation No. 1/2003  
Communication from the Commission  
OJ 2013/C 167/07  On quantifying harm in actions for damages based on 
breaches of Article 101 or 102 of the TFEU  
Practical Guide  
SWD(2013) 205 - C(2013) 3440  Quantifying harm in actions for damages based on breaches of 
Article 101 or 102 of the TFEU  
Communication from the Commission  
OJ 2009/C 45/02  Guidance on the Commission's enforcement priorities in 
applying Article 82 of the EC Treaty to abusive exclusionary 
conduct by dominant undertakings  
Commission Notice  
OJ 2013/C 366  On a simplified procedure for treatment of certain 
concentrations under Council Regulation  (EC) No. 139/2004  
Commission Decision (EU) 2018/1927 of 
5 December 2018  Laying down internal rules concerning the processing of 
personal data by the European Commission in the field of 
competition in relation to the provision of information to data 
subje cts and the restriction of certain rights  
Source:  DG Competition, WTO Secretariat, and EUR -Lex. 
3.3.4.1   Enforcement of competition law  (anti -competitive agreements and abuse of 
dominant position)  
3.249.   The enforcement action of the Commission and national competition authorities continues 
to be based on Article s 101 and 102 of the TFEU and Council Regulation (EC) No. 1/2003 , and on 
sector -specific rules, including  on agriculture, fisheries, insurance, po stal services, professional 
services, transport, and telecommunications271, which all remained unchanged . The main 
investigation and redress procedures were not amended  over the review period . 
Investigations and fines imposed  
3.250.   In 201 8, the level of fines imposed on cartels was  about  EUR 800 million ( Table 3.24 ), less 
than in the previous two years; 2016 saw the highest amount of fines, with EUR  3,561 million . 
No case from 2018 is included in the list of the ten highest cartel fines per case since 1969.272 
3.251.   The above table shows that the national competition authorities are actively engaged in the 
enforcement of competition rules. As evidenced by it, a majority of cases are investigated or 
submitted by the competition authorities of the member States. The Direc tive further supporting the 
role of national competition authorities in enforcing European competition law273 can thus be 
expected to contribute to the effective investigation of anti -competitive behaviour and merger cases 
in the EU.  
                                                
271 European Commission, Competition . Viewed at: http://ec.europa.eu/competition/index_en.html . 
272 European Commission, Cartel Statistics . Viewed at: 
http://ec.europa.eu/competition/cartels/statistics/statistics.pdf . 
273 Discussed in paragraph 3.1.  WT/TPR/S/395 • European Union  
 
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  Table 3.24 Anti-trust cases, investigations, decisions, and fines  
 Note  2014  2015  2016  2017  2018  
Commission 
investigations   23  43 18 29 31 
National competition 
authority (NCA) 
investigations   173 136 127 122 134 
Submitted by NCAs   101 94  77 80 67 
A. 101  Anti-competitive 
agreements  66.34%  72.34%  83.12%  55% 68.66%  
A. 102  Abuse of dominant 
position  29.70%  21.28%  12.99%  33.75%  23.88%  
A. 101/102  Combined  3.96%  6.38%  3.90%  10% 5.97%  
Not specified      1.25%  1.49%  
Cartels  
Commission        
Cases decided  No 10 5 6 7 4 
Fines imposed 
(not adjusted for 
Court judgements)  EUR million  1,689  366 3,561  1,946  801 
Source:  European Commission, European Competition Network, Statistics . Viewed at: 
http://ec.europa.eu/competition/ecn/statistics.html ; and European Commission, Cartel Statistics . 
3.252.   During the review period, several decisions were adopted by the Commission concerning 
large f irms in the digital services market, such as Google274, Amazon275, and Qualcomm.276 The 
Commission also took action to ensure competition in gas supply markets, notably adopting a 
commitment decision involving the Russian provider Gazprom.277 Gazprom's commitments  include 
the removal of barriers to the free flow of gas in Central and Eastern Europe; the integration of gas 
markets in Central and Eastern Europe; ensuring competitive gas prices, especially in Bulgaria, 
Estonia, Latvia, Lithuania and Poland; and the re moval of demands obtained by leveraging the 
market position.278  
3.253.   The CJEU delivered several judgements on antitrust law. In the case of Intel vs Commission , 
it set aside the decision of the General Court related to the rebate scheme of Intel, and referred it  
back to the General Court for further examination of the arguments of the company.279 In addition, 
the CJEU clarified questions related to excessive pricing through a preliminary ruling. Thus, in the 
Latvijas Autoru apvienība  case, the Court ruled that, in order to decide on whether prices are unfair, 
it is necessary to compare them to the  prices in neighbouring member States, or in other member 
States after adjusting them in accordance to the purchasing parity index. The selection of such 
member States is to be based on objective criteria, and the comparison should be made on a 
consistent basis.280 
                                                
274 European Commission, A ntitrust: Commission fines Google EUR  2.42 billion for abusing dominance 
as search engine by giving illegal advantage to own comparison shopping service. Viewed at: 
http://europa.eu/r apid/press -release_MEMO -17-1785_en.htm . The Commission also fined Google for illegal 
practices regarding Android mobile devices. In that case, the fine came to EUR  4.34 billion.  
275 European Commission, Antitrust: Commission accepts commitments from Amazon on e -books . 
Viewed at: http://europa.eu/rapid/press -release_IP -17-1223_en.htm . 
276 European Commission, Antitrust: Commission fines Qualcomm EUR  997 million for abuse of 
dominant m arket position . Viewed at: http://europa.eu/rapid/press -release_IP -18-421_en.htm . 
277 Case AT.39816 – Upstream gas supplies in Central and Eastern Europe.  
278 In the case of breach of these obligations, the Commission can impose a fine of up to 10% of the 
entity's worldwide turnover. European Commission, Antitrust: Commission imposes binding obligations on 
Gazprom to enable free flow of gas at competitive prices in Central and Eastern Europea n gas markets . Viewed 
at: http://europa.eu/rapid/press -release_IP -18-3921_en.htm . 
279 CJEU, The Court of Justice sets aside the judgment of the General Court which had upheld the fine of 
EUR 1.06 billion imposed on Intel by the Commission for abuse of a dominant position. Viewed at: 
https://curia.europa.eu/jcms/upload/docs/application/pdf/2017 -09/cp170090en.pdf . 
280 C-177/16, Judgement of the Court (Second Chamber), 14 September 2017, ECLI:EU:C:2017:689. 
Viewed at: 
http://curia.europa.eu/juris/document/document.jsf?text=&docid=194436&pageIndex=0&doclang=EN&mode=
req&dir=&occ=first&part=1 . WT/TPR/S/395 • European Union  
 
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  3.254.   In the area of collective damages, the Commission published a report on the implementation 
of the Commission Recommendation of 11 June 2013.281 The Commission concluded that the 
Recommendation succeeded in starting a debate on the facilitation of acc ess to justice and on the 
prevention of abusive litigation, even if the majority of the member States did not consider the 
Recommendation when adopting relevant legislation. To remedy the situation, the Commission 
intends to continue the promotion of the p rinciples set out in the Recommendation, and to carry out 
further analysis of some specific aspects.  
3.255.   In 2017, the European Court of Auditors started a performance audit procedure, looking at 
whether the Commission has been effective in its role as the mai n enforcer of competition rules in 
the specific areas of antitrust and merger control in the EU. The audit was included as a priority in 
the Court of Auditor's annual programme for 2019.282 A report is planned for publication by the end 
of 2019.  
Leniency  and whistleblowing: online submissions  
3.256.   In order to support its enforcement action, the Commission continues to enhance the existing 
leniency programme, allowing cartel members to report the cartel to the Commission in exchange 
for immunity from (or reduction  of) fines.283 In order to make this process more efficient and rapid, 
the Commission launched the "eLeniency" tool .284 This tool allows company representatives and their 
lawyers to submit online statements and submissions in the context of leniency applicatio ns, and to 
provide responses to requests for the provision of information without the need to travel to Brussels. 
eLeniency provides the same guarantees of confidentiality of information  as the usual procedures 
(documents are not saved in the sy stem, no tr ace of statements or other documents remains in the 
applicants' computer after formal submission, etc).285 Moreover, the Commission prepared 
guidelines for eLeniency users, to facilitate the submission of documents online.286 
3.257.   Similarly, insider information on the existence of cartels or any other form of 
anti-competitive behaviour can be submitted online, and the anonymity of the person will be 
protected, as appropriate.287 
3.3.4.2   Mergers and acquisitions  
3.258.   Merger control is based on Council Regulation (EC) No. 139/2004 o f 20 January  2004. The 
Commission Staff Working Document accompanying the report on Competition Policy 2017 confirms 
that, as a result of public consultations, the legislation in this area was deemed effective overall, 
although t he Commission continues to reflect  on whether potential improvements merit proposing 
any legislative or non -legislative changes to the EU Merger Regulation .288 
3.259.   Several important decisions on cases related to mergers were taken in 2017 -18. For 
example, in 2017, the Commission cleared a  merger between Dow and DuPont only after the 
companies agreed to divest a significant part of DuPont's pesticide business, including its R&D 
                                                
281 European Commission, Report from the Commission to the European Parliament, the Council and the 
European Economic and Social  Committee on the implementation of the Commission Recommendation of 
11 June 2013 on common principles for injunctive and compensatory collective redress mechanisms in the 
Member States concerning violations of rights granted under Union law . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52018DC0040&from=EN . 
282 European Court of Auditors, 2019 Work Programme . Viewed at: 
https://www.eca.europa.eu/Lists/ECADocuments/WP2019/WP2019_EN.pdf . 
283 More details on the leniency policy can be found at: 
http://ec.europa.eu/competition/cartels/leniency/leniency.html . 
284 European Commission, Antitrust: Commission launches new online tool for cartel leniency and 
settlements and non -cartel cooperation . Viewed at:  https://europa.eu/rapid/press -release_IP -19-
1594_en.htm . 
285 eLeniency is available at: eleniency.ec.europa.eu . 
286 European Commission, Notice to eLeniency users . Viewed at: 
https://ec.europa.eu/competition/cartels/leniency/eleniency_guidance_document.pdf . 
287 European Commission, Cartels: Anonymous Whistl eblower Tool . Viewed at: 
http://ec.europa.eu/competition/cartels/whistleblower/index.html . 
288 European Commission, Staff Working Document accompanying the document Report from the 
Commission to the European Parliament, the Council, the European Economic and Social Committee and the 
Committee of the Regions: Report on Competition Policy 2017 . Viewed at: 
https://ec.europa.eu/competition/publications/annual_report/2017/part2_en.pdf . WT/TPR/S/395 • European Union  
 
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  organi zation289 In 2018, the Commission conditionally cleared Bayer's acquisition of Monsanto, with 
the condition th at the companies would divest the relevant assets, including some of its R&D 
organization, which were ultimately sold to BASF.290 The Commission also enforces compliance with 
the procedural aspects of merger control. Thus, it imposed a fine of EUR  110 millio n on Facebook 
for providing misleading information on its bid to acquire Whatsapp291, and a fine of 
EUR 124.5  million on Altice for gun -jumping conduct when it acquired PT Portugal.292 Furthermore, 
in 2019, the Commission fined General Electric (GE) for provid ing incorrect information during the 
Commission's investigation of GE's planned acquisition of LM Wind, and it also fined Canon for partial 
early implementation of  its acquisition of Toshiba Medic al Systems Corporation.293 
3.260.   In early 2019, the Commission prohibited the merger of Siemens and Alstom. Based on an 
in-depth investigation, the Commission found that the merger would have reduced competition in 
some signalling markets and in very high -speed trains, depriving customers of choice of suppl iers 
and products. No appropriate remedy had been proposed, so the proposed merger was blocked. As 
explained by Commissioner Vestager: " Siemens and Alstom are both champions in the rail industry. 
Without sufficient remedies, this merger would have resulted  in higher prices for the signalling 
systems that keep passengers safe and for the next generations of very high -speed trains".294 
3.261.   The General Court, in turn, took several decisions related to merger cases. It annulled the 
Commission decision prohibiting the  acquisition of TNT Express by UPS. This decision was confirmed 
by the CJEU in 2019.295 The General Court overturned the Commission decision clearing Liberty 
Global's acquisition of Ziggo, subject to conditions, for failure to state reasons.296 It dismissed th e 
appeal against the Commission's decision to impose a fine on Marine Harvest for breach of the stand -
still obligation.297 In 2019, it also dismissed the appeal by KPN against a 2016 decision to 
conditionally clear the joint venture between Vodafone and Libe rty Global in the Netherlands .298 The 
CJEU issued a preliminary ruling answering the question posed by the Austrian Supreme Court, 
providing much -awaited clarification on the assessment of joint ventures.299 The CJEU also issued a 
preliminary ruling in relatio n to the stand -still obligation , clarifying the notion of early 
implementation of a concentration.300  
                                                
289 Commission Decision of 27 March 2017 declaring a concentration compatible with the internal market 
and the functioning of the EEA Agreement (Case M.7932 – Dow/DuPont). Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri= uriserv%3AOJ.C_.2017.353.01.0009.01.ENG . 
290 Commission Decision of 21 March 2018 declaring a concentration compatible with the internal market 
and the functioning of the EEA agreement (Case M.8084 – Bayer/Monsanto). Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A52018M8084%2802%29 . 
291 Commission Decision of 18 May 2017 imposing fines under Article 14(1) of Council Regulation (EC) 
No. 139/2004  for the supply by an undertaking of incorrect or misleading information (Case No. M.8228 – 
Facebook/WhatsApp). Viewed at: https://eur -lex.europa.eu/legal -
conten t/EN/TXT/?uri=CELEX%3A52017M8228%2803%29 . 
292 Commission Decision of 24 April 2018, Case M.7993 - Altice/PT Portugal. Viewed at: 
https://ec.europa.eu/competition/mergers /cases/decisions/m7993_849_3.pdf . 
293 Commission Decision of 8 April 2019, Case M.8436 - General Electric Company/LM Wind Power 
Holding; and Commission Decision of 27 June 2019, Case M.8179 Canon/Toshiba Medical Systems Corporation.  
294 European Commission, Mergers: Commission prohibits Siemens' proposed acquisition of Alstom . 
Viewed at: http://europa.eu/rapid/press -release_IP -19-881_en.htm . 
295 Judgement of the Court (First Chamber) of 16 Janu ary 2019, European Commission vs United Parcel 
Service, Inc, Case C -265/17 P, ECLI:EU:C:2019:23. Viewed at:  
http://curia.europa.eu/juris/celex.jsf?celex=62017 CJ0265&lang1=en&type=TXT&ancre= . 
296 Judgment of the General Court of 26 October 2017, KPN vs Commission, Case T -394/15. Viewed at:  
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:62015TA0394&from=EN . 
297 Judgment of the General Court of 26 October 2017, Marine Harvest vs Commiss ion, Case T -704/14. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:62014TJ0704&from=EN . 
298 Judgement of the General Court of 23 May 2 019, KPN vs Commission, Case T -370/17. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:62017TJ0370&from=EN . 
299 Judgement of the Court (Fifth Chamber) of 7 September 2017, Austria Asphalt GmbH & Co OG vs 
Bundeskartellanwalt, Case C -248/16, ECLI:EU:C:2017:643. Viewed at: https://eur -lex.europa .eu/legal -
content/EN/TXT/PDF/?uri=CELEX:62016CJ0248&from=EN . 
300 Judgement of the Court (Fifth Chamber) of 31 May 2018, Ernst & Young P/S vs Konkurrencerådet, 
Case C -633/16, ECLI:EU:C:2018:371. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:62016CA0633&qid=1572866626325&from=EN . WT/TPR/S/395 • European Union  
 
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  Table 3.25 Merger notifications and decision s, 2015-18 
 2015  2016  2017  2018  
Notified cases  337 362  380 414 
 Withdrawn  8 9  9 12 
Phase I decisions      
 Out of scope  1 1  0 0 
 Compatible  297 327  353 366 
 Compatible with 
remedies  13 19  18 17 
Phase II decisions      
 Compatible  1 1 0 4 
 Compatible with 
remedies  7 6 2 6 
 Prohibited  0 1 2 0 
Source:  DG Competition , Merger Statistics . Viewed at: 
http://ec.europa.eu/competition/mergers/statistics.pdf . 
3.3.4.3   Sector inquiries and reports  
3.262.   Other important developments related to specific sector inquiries carried out by the 
Commission.301 These inquiries form the basis for public reports, and help the Commission to decide 
whether formal investigation procedures should be launched.  
3.263.   During the period under review, the Commission finali zed its inquiry into the e -commerce 
sector. The exercise was launched in 2015, with a view to investigating the barriers to online trade.302 
The final report of the inquiry was adopted by the Commission in May 2017, accompanied by a Staff 
Working Document de tailing the findings of the report.303 The final results of the sector inquiry 
highlight ed, as major market trends , the increased use of online retail shops, together with 
(i) selective distribution systems304; and (ii) contractual restrictions to better contr ol product 
distribution .305 The report found that s ome of these practices may be justified, for example in order 
to improve the quality of product distribution ; others may unduly prevent consumers from benefiting 
from greater product choice and lower prices in e-commerce and , therefore , warrant Commission 
action to ensure compliance with EU competition rules.306  
3.264.   One of the main findings  in relation to digital content was the widespread use of 
geo-blocking, preventing online buyers from acquiring digital goods/ services based on their 
geographical location  (around 60% of questioned digital content providers were found to use geo -
blocking). These practices are implemented through restrictions in the licen ces granted to users . 
The report stresse d that licensing is essential for copyright holders  and noted that the assessment  
of the consequences of licensing  practices in each  case needs to consider the specificities of the 
industry under consideration. To end the discriminatory practices hampering e -commerce and to 
enhance cross -border competition in online trade, the EU adopted a regulation addressing issues 
related to geo -blocking (Section 4.4.3.2)  
3.265.   Following up on a sector inquiry into the pharmaceutical sector of 2008, the Commission 
adopted annual reports on pate nt settlements between generic and originator companies, identifying 
                                                
301 European Commission, Antitrust: Sector inquiries . Viewed at: 
http://ec.europa.eu/competition/antitrust/sector_inquiries.html . 
302 European Commission, Antitrust: Commission launches e -commerce sector inquiry . Viewed at: 
http://europa.eu/rapid/press -release_IP -15-4921_en.htm . 
303 European Commission, Commission Staff Working Document accompanying the document Report 
from the Commission to the Council and the European Parliament: Final report on the E -commerce Sector 
Inquiry . Viewed at: https://eur -lex.europa.eu/resource.html?uri=cellar:9d1137d3 -3570-11e7-a08e-
01aa75ed71a1.0001.02/DOC_1&format=PDF . 
304 Where the pro ducts can only be sold by pre -selected authorized sellers, which allows manufacturers 
to better control their distribution networks, in particular in terms of the quality of distribution but also of price.  
305 Depending on the business model and strategy, su ch restrictions may take various forms, such as 
pricing restrictions, marketplace (platform) bans, restrictions on the use of price comparison tools, and 
exclusion of pure online players from distribution networks.  
306 European Commission, Sector inquiry int o e-commerce . Viewed at: 
http://ec.europa.eu/competition/antitrust/sector_inquiries_e_commerce.html#findings . WT/TPR/S/395 • European Union  
 
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  concerns related to potential delays in generic market entry to the detriment of consumers.307 The 
last such annual report, for the period January -December 2016, noted that, i n the future , the 
Commission may decide to continue the monitoring exercise in order to further examine the 
development of the foregoing trends .308  
3.266.   In addition to these annual reports, the Commission is continuing its comprehensive 
examination of the pharmaceutical secto r, and recently published a report on competition 
enforcement in that sector.309 It report ed about 29 antitrust decisions against pharmaceutical 
companies adopted by competition authorities of member States , resulting in fines of over 
EUR 1 billion. In 2009-17, the Commission reviewed around 80 merger cases , with concerns raised 
in 19 of th ose. Some landmark cases tackl ed issues related to access to markets of generic and 
more affordable medicines , for example , in Italy ( Aspen ), the United Kingdom ( Paroxetine , and 
Pfizer/Flynn ), Denmark ( CD Pharma ), and by the Commission itself ( Lundbeck, Fentanyl  and 
Servier ).310 The Commission concluded that competition law enforcement contributes to ensuring 
access to affordable medicines, and should be based on a solid regulatory and legislative basis.  
3.267.   The Commission published several other reports relating to c ompetition policy issues in 
different sectors (Table 3.26). During the period under review the following reports were published:  
Table 3.26 Summary table of other reports relating to competition policy issues  
Report  Note  
EU loan syndication and its 
impact on competition in 
credit markets  The report finds several competition risks in the loan syndication area in 
different stages of the process, such as the competitive bidding process for 
appointing individual banks to the lead banking group; the use of debt 
advisors which are also involved in the syndicated loan; coordination by 
lenders on the sale of the loan on the secondary market . It also lays down 
some important safeguards to ensure a competitive outcome of the loan 
syndication process (promotion of unbundled price competition, avoidanc e of 
unwarranted information exchange, etc.).  
Competition policy for the 
digital era  Digital markets require competition law enforcement to protect consumers. 
According to the report, special attention should be paid to "killer 
acquisitions", where big te ch companies acquire fast -growing start -ups. The 
report also discusses the issues related to data. Data portability and 
interoperability are important tools that allow consumers to switch platforms 
easily. In addition, market places act as regulators, layi ng down rules for 
their users' interaction, and competition law should enforce them to ensure a 
level playing field for the participants.  
Study on Producer 
Organisations (PO) and their 
activities in the olive oil, 
beef and veal and arable 
crops sectors  The study was based on a survey of 203 POs and 23  associations of 
producers (APOs). One of the main findings was that farmers set up POs to 
strengthen their position in the market, to have better access to training, 
and to increase their bargaining  power. There are some barriers to setting up 
a PO, such as a lack of support from the government and from sector 
organi zations, and a lack of good examples of successful cooperation within 
the sector . 
                                                
307 Pharmaceuticals. Pharmaceuticals - Sector inquiry and follow -up. Viewed at: 
http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/index.html . 
308 European Commission, 8th Report on the Monitoring of Patent Settlements (period: January -
December 2016) . Viewed at: 
http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/patent_settl ements_report8_en.pdf . 
309 European Commission, Competition Enforcement in the Pharmaceutical Sector (2009 -2017): 
European competition authorities working together for affordable and innovative medicines . Viewed at: 
https://ec.europa.eu/competition/publications/reports/kd0718081enn.pdf . 
310 European Commission, Competition Enforcement in the Pharmaceutical Sector (2009 -2017): 
European competition authorities working together for affordable and innovative medicines . Viewed at: 
https://ec.europa.eu/competition/publications/reports/kd0718081enn.pdf . WT/TPR/S/395 • European Union  
 
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  Report  Note  
Feasibility study on the 
microeconomic impact of 
enforcement of competition 
policies on innovation311 The study had several goals: (i) conduct a literature review; (ii) develop a 
methodology; (iii) collect data on R&D spending, patents and product 
characteristics; and (iv) analyse the collected data. The study concentrated 
on the consequences of the 2012 consolidation of the H ard Disc Drives 
market  for the innovation. Seagate/Samsung and Western  Digital/HGST 
mergers were chosen  as case studies . In the case of Seagate , innovation 
was increased ; while in the case of Western Digital , no change was observed 
in R&D spending, or product characteristics, but there was an increase in 
patent ing activity.  
Economic impact of 
competition policy 
enforcement on the 
functioning of telecoms 
markets in the EU  The study gathered information on all competition policy decisions of the 
Commission and national competition authorities of the past 15 years related 
to telecom markets. The analysis measured the correlation between the 
decisions taken and the functioning  of the market, through observing prices, 
penetration, coverage and investment. Specifically, three decisions affected 
the better functioning of the fixed and mobile markets . 
Improving Monitoring 
Indicators System to 
Support DG Competition's 
Future Policy  Assessments  The aim of the study was to map and categorize the indicators relevant to 
DG Comp policy interventions. In addition, the study looked at different 
indicators used by other international organizations and national contracting 
authorities. It is  recommended that DG Comp systematically collect data, set 
up a database of indicators, plan for stakeholder interviews and surveys, and 
improve the consistency of the defined general and specific objectives .  
Zero-rating practices in 
broadband markets  The study had three main targets, starting with the understanding of how 
widespread the practice of zero -rating is in Europe. In addition, it contained 
a review of available legal and economic literature, and developed a 
framework for the assessment of the e ffect of zero -rating on competition and 
efficiency.  
Source:  WTO Secretariat.  
3.3.4.4   International cooperation  
3.268.   The EU cooperates with the competition  authorities of different countries at both bilateral 
and multilateral levels . At the bilateral level, the EU recently signed an agreement with the 
competition authority of Mexico on the exchange of information related to competition legislation 
and the sh aring of non -confidential information on cases under investigation.312 The EU and Japan 
also started negotiating a review of their EU -Japan Agreement on cooperation on anti -competitive 
activities, with a view to enhancing the exchange of information between their respective 
anti-competitive authorities.313 Moreover, in April 2 019, the Terms of Reference of the EU -China 
Competition Policy Dialogue was approved.314 At the multilateral level, the EU is actively cooperating 
with the OECD, the International Competition Network (ICN), UNCTAD, etc.  
3.269.   The Commission published a notice to m itigate the risk of uncertainty in competition policy 
enforcement and cooperation relating to  the withdrawal of the United Kingdom from the EU.315 The 
notice points out that businesses incorporated, or having headquarters, in a third country are not 
exempt f rom the application of EU competition law; when it comes to antitrust; what matters is 
whether the anti -competitive conduct is implemented in, or has an effect on, the Single Market. The 
applicability of EU merger control rules depends on whether the jurisdictional criteria of the 
EU Merger Regulation 139/2004  are fulfilled.  
                                                
311 Viewed at: http://ec.europa.eu/competition/publications/reports/kd0417860enn.pdf . 
312 European Commission, Competition: Commission agrees framework for dialogue on competition 
policy issues with Mexico . Viewed at: http://europa.eu/rapid/press -release_IP -18-4042_en.htm . 
313 European Commission, Competition: EU and Japan start negotiations for a 2nd g eneration 
cooperation agreement in the field of competition . Viewed at: 
http://ec.europa.eu/competition/international/news.html . 
314 Terms of Reference of the EU -China Competition Policy  Dialogue between on the one side the 
Directorate -General for Competition of the European Commission and on the other side the State 
Administration for Market Regulation of the People's Republic of China, 2019. Viewed at: 
http://ec.europa.eu/competition/international/bilateral/agreement_tor_china_2019.pdf . 
315 European Commission Directorate General for Competition, Notice to Stakeholders: Withdrawal of 
the Un ited Kingdom and the EU competition law . Viewed at: https://ec.europa.eu/info/sites/info/files/eu -
competition -law_en.pdf . WT/TPR/S/395 • European Union  
 
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  3.3.5   State trading, state -owned enterprises, and privatization  
State trading  
3.270.   During the period under review, the EU notified three state trading enterprises (STEs) to the 
WTO in accordance w ith Article XVII of GATT 1994 and the Understanding  on the Interpretation of 
Article XVII (Table 3. 27).  
Table 3.27 New and full notifications on STEs  
Enterprise  EU member 
State  Description  of products 
affecte d Reason and purpose  
Alko Oy (Al ko Inc.)  Finland  Alcohol ic beverages 
(spirituous drinks, wines , 
and strong beer over 5.5%)  The exclusive retail sale of alcoholic 
beverages over 5.5% alcohol. The aim 
of the monopoly is to limit alcohol 
consumption and alcohol -related 
damage ; Alko Inc. is supervised by 
the Ministry of Social Affairs and 
Health.  
British Wool 
Marketing Board 
(BWMB)  United 
Kingdom  Fleece wool (CN code: 
5101110000)  The monopoly on the collection of 
fleece wool from producers. BWMB 
aims to ensure a steady supply of 
quality wool.  
Systembolaget AB  Sweden  Alcohol ic beverages 
(spirituous drinks, wines , 
and strong b eer) The exclusive retail sale of alcoholic 
beverages. The retail monopoly aims 
to reduce the total alcohol 
consumption by limiting availability.  
Source:  WTO documents G/STR/N/16/EU/Add.1 , 21 April 2017 ; and G/STR/N/17/EU , 12 July 2018. 
3.271.   Article 37 of the TFEU ensures that state monopolies provide  non-discriminatory treatment 
when operating commercially. It specifies that there will be no discrimination on goods imported or 
exported between member States , if a State, either directly or indirectly , supervise s, determines or 
appreciably influences the intra-EU trade. As noted in the previous Review , these provisions apply 
to the EU internal market but not to external trade.316 General EU rules (e.g. competition, freedom 
of establishment and non -discrimination) a pply to state monopolies . 
State -owned enterprises  
3.272.   State -owned enterprises ( SOEs) continued to play an important role in the EU economy  in 
terms of revenue, value added, and employment , although their importance varies from one member 
State to another . According to a 2018 report by  the European Commission317, EU member States  
owned about EUR  16.5 trillion of public assets in 2015 , mostly in services and public utilities 
(i.e. water, electricity , energy, and transports) and in financial institutions, employing more than 
4 million people.318 At the individual country level, in absolute terms, the number of SOEs covered 
in the report ranged from 35 or below (in Cyprus and Malta) to over 3,000 (in Germany, Italy, 
Bulgaria, and Poland) in 2015.319  
3.273.   The EU does not have a legal definition of SOEs , but several articles of the TFEU refer to 
"public undertakings". Article 345 is neutral on the issue of ownership (including ownership of public 
undertakings), stating that "The Treaties shall in no way p rejudice the rules in Member States 
governing the system of property ownership".  However, Article 106 states that general EU rules are 
applicable to SOEs, including rules on non-discrimination  and competition policy. The Commission 
                                                
316 WTO document WT/TPR/S/357/Rev.1, 13 October 201 7. 
317 European Commission. Public Assets: What's at Stake? An Analysis of Pubic Assets & their 
Management in the European Union . Viewed at: https://ec.euro pa.eu/info/sites/info/files/economy -
finance/dp089_en_public_assets.pdf .  
318 The study is based on more than 37,000 firms (registered) registered companies in the EU -28, where 
one or more public sector entities (central or local government, or social securit y funds) own a direct or 
indirect stake. The detailed methodological notes of the study can be viewed at: 
https://ec.eur opa.eu/info/sites/info/files/economy -
finance/dg_ecfin_am_final_report_pillar_1_methodological_notes_0.pdf . 
319 European Commission, Study on State asset management in the EU: Final study report for Pillar 1 - 
EU Summary Report . Viewed at: https://ec.europa.eu/info/sites/info/files/economy -
finance/dg_ecfin_am_final_report_pillar_1_eu28_summary_report.pdf .  WT/TPR/S/395 • European Union  
 
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  ensure s the application of the provisions of this Article and address es appropriate directives or 
decisions to member States.  With respect to public undertakings, under Commission Directive 
No. 2006/111/EC, member States are required to keep and, upon request of the Commission, t o 
report to the Commission information relating to financial relations between public authorities and 
public undertakings, to ensure the transparency of public funds made available to state -owned 
companies.320 Commission Directive No. 2006/111/EC does not ob lige member States to provide a 
list of public undertakings. Moreover, as many member States are also members of the Organisation 
for Economic Co -operation and Development (OECD), in principle, they follow the non -binding 
Guidelines on Corporate Governance  of SOEs.321  
3.274.   Since there is no specific EU legislation to regulate S OEs at the EU level, each member State 
has its own legal provisions and retains competence for SOEs . Table A3.4  presents an overview of 
governments as stakeholders in enterprises, as report ed by individual member States. 
SOE definitions are  quite heterogeneous among EU member States . For instance, some member 
States report SOEs with only majority ownership, whereas others include all shareholding or 
investments of the State. Moreover, regard ing responsible government institutions for SOEs, some 
member States designate a specific agency or company (owned by the State) to manage SOEs on 
behalf of the State. The level of detailed information on SOEs also varies greatly across member 
States, as n oted in the previous Review.322 
3.275.   While various forms of state ownership remain in the EU, member States are required to 
publish information on the participation of the general government in the capital of public and private 
corporations in respect of economically significant amounts. In this regard, Council Directive 
No. 2011/85/EU323 sets out requirements for budgetary frameworks of the member States , in order 
to reinforce EU economic governance. Such data requirements, which are comparable across 
member States, provide more transparency on the extent and type of public -sector ownership, public 
management of assets, and overall fiscal position, in order to prevent and mitigate fiscal risks. The 
data on contingent liabilities324 shows countries with significant amounts of liabilities, such as 
Greece  (119.6% of GDP), the Netherlands (102.7%), Germany (91.7%), Luxembourg (82.5%), and 
Cyprus (74.9%).  The Slovak Republic, Romania, Lithuania, the Czech Republic, and Croatia have 
small amounts of liabilities. Gross liabilities of public corporations are much higher in countries where 
governments control financial institutions (Chart 3.7).   
                                                
320 Comm ission Directive No. 2006/111/EC of 16 November 2006 on the transparency of financial 
relations between Member States and public undertakings as well as on financial transparency within certain 
undertakings. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32006L0111&from=EN . For the purpose of this Directive, a "public 
undertaking" is defined as "any undertaking over which the public aut horities may exercise directly or indirectly 
a dominant influence by virtue of their ownership of it, their financial participation therein, or the rules which 
govern it". The Directive applies to public undertakings with a turnover of more than EUR 40 mil lion (or a 
balance sheet total of EUR 800 million for public credit institutions). For these, member States must keep 
information on financial relations, and submit it to the Commission upon request. Reporting of more detailed 
information is compulsory for  manufacturing public undertakings with a turnover of more than EUR 250 million. 
The Directive requires member States to ensure the separation of accounts for undertakings that enjoy special 
or exclusive rights granted by a member State, or undertakings en trusted with the operation of a service of 
general economic interest that also carry out other activities.  
321 OECD (2015), OECD Guidelines on Corporate Governance of State -Owned Enterprises , 2015 Edition, 
OECD Publishing, Paris. The Guidelines provide recom mendations with respect to governance of individual 
SOEs, as well as state -ownership practices and the regulatory and legal environment in which SOEs operate.  
322 WTO document WT/TPR/S/357/Rev.1, para. 3.229, 13 October 2017.  
323 Council Directive No. 2011/85 /EU of 8 November 2011 on requirements for budgetary frameworks of 
the Member States. Viewed at: https://eur -lex.europa.eu/legal -content/GA/TXT/?uri=CELEX:32011L0085 .  
324 The Directive requires member States to publish relevant information on contingent liabilities with 
potentially large impacts on public budgets. The liabilities are called "contingent" in the sense that they are, by 
nature, only potential and not actual lia bilities, and can occur as actual government liabilities only if certain 
specific conditions prevail.  WT/TPR/S/395 • European Union  
 
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  Chart 3.7 Liabilities of public corporations , by controlling government level, 2017  
(% of GDP)  
 
Note:   2016 data used for Austria , France, and  Germany.  
Source:  Eurostat. Viewed at:  
http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=gov_cl_liab&lang=en . 
Privatization  
3.276.   As per Article 345 of the TFEU, privatization is under the exclusive competence of the 
individual member States. Privatization of state enterprises or assets is subject to each member 
States' privatization laws, if they exist. There is no specific EU legislation or EU policy with respect 
to privatization, but member States undergoing certain reforms often publish privatization plans 
(e.g. procedure of privatization, and time -frame). General EU rules (e.g. on non -discrimination, 
freedom of establishment , and competition) apply if a member State decides to privatize a certain 
company.  
3.277.   There are a number of national motives for privatization by EU member States. According 
to a 2018 OECD report, these relate to, inter alia , fiscal concerns, improvement of marke t structures 
or economic efficiency, or public interest.325 For example, in the case of the Czech Republic, 
privatization is motivated by two considerations, namely reducing public debt and influencing market 
conditions in the sectors where SOEs operate.326 Greece has continued to implement the 
privati zation programme agreed within the framework of the European Stability Mechanism 
Programme since August 2015 .327  
3.278.   Privatization deals continued in the EU. According to the 2015/16 Privatization Barometer 
Report328, the EU reached the highest level of privatization revenues in 2015, with EUR 80 billion 
                                                
325 OECD, Privatisation and the Broadening of Ownership of State -Owned Enterprises . Viewed at: 
https://www.oecd.org/daf/ca/Privatisation -and-the-Broadening -of-Ownership -of-SOEs-Stocktaking -of-National -
Practices.pdf . The report covers 13 EU member States, namely the Czech Rep ublic, Denmark, Estonia, France, 
Germany, Hungary, Italy, Latvia, Lithuania, the Netherlands, Poland, Sweden, and the United Kingdom.  
326 OECD (2018), Privatisation and the Broadening of Ownership of State -Owned Enterprises,  pp. 16. 
Viewed at: https://www.oecd.org/daf/ca/Privatisation -and-the-Broadening -of-Ownership -of-SOEs-Stocktaking -
of-National -Practices.pdf .  
327 European Council and Council of the EU, Greece: the third economic adjustment programme . Viewed 
at: https://www.consilium.europa.eu/en/policies/finan cial-assistance -eurozone -members/greece -programme/ ; 
and European Commission, Financial Assistance to Greece . Viewed at: https://ec.europa.eu/info/business -
economy -euro/economic -and-fiscal-policy -coordination/eu -financial -assistance/which -eu-countries -have-
received -assistance/financial -assistance -greece_en .  
328 Privatization Barometer, The PB Report 2015/2016 . Viewed at 
http://www.privatizationbarometer.com/PUB/NL/5/9/PB_AR2015 -2016.pdf .  
0%20%40%60%80%100%120%140%GreeceNetherlandsGermanyLuxembourgCyprusFranceItalySloveniaBelgiumSwedenIrelandFinlandPolandPortugalUnited KingdomDenmarkAustriaSpainLatviaMaltaEstoniaHungaryBulgariaCroatiaCzech RepublicLithuaniaRomaniaSlovak RepublicFinancial activities Non-financial activitiesChart 3. [EU] Liabilities of public corporations by controlling government level, 2017
(% of GDP)
Note: 2016 data used for Austria, France and Germany.
Source: Eurostat online information. Viewed at: http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=gov_cl_liab&lang=en.  WT/TPR/S/395 • European Union  
 
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  since 2000, mainly due to divestment of financial sector assets that had come under state ownership 
during the financial crisis. However, in 2016, the revenues fell to EU R 34 billion. Among the 
EU member States, in 2015 -16, the United Kingdom was the leading country (in terms of number 
of transactions and value), followed by Italy and France.  
3.3.6   Government procurement  
3.279.   In 2015, t otal general government public procurement expen diture on works, goods and 
services in the EU (excluding utilities) amounted to EUR 2,015.3 billion  (above and below public 
procurement thresholds) , or about  14% of GDP,  with some EUR 350  billion published on the Tenders 
Electronic Daily (TED) supplement t o the Official Journal of the EU. Including defence and utilities, 
the total value of government procurement in the EU and published on TED is about  EUR 450 billion  
i.e. 3.1% of the EU's GDP . Almost half of the EU's Structural and Investment Funds (ESI),  worth 
over EUR 450 billion , are spent via public contracts for the period 2014 -20.329  
3.280.   The EU public procurement framework, designed to implement the EU's obligations under 
the revised Government Procurement Agreement (GPA) (see below), is based upon certain general 
principles derived from the TFEU and comprises three directives330 that, toget her, are known as the 
"2014 Directives" : the Classical Directive331; the Concessions Directive332, and the Utilities Directive 
(water, energy, transport, and postal services).333  
3.281.   The 2014 Directives set out the rules on the award of contracts. While most rules in public 
procurement have been harmoni zed at EU level, the public procurement directives allow for flexibility 
in implementation at the national level.  The CJEU delivers regular judgements in procurement cases, 
which are binding on EU member States. The core principles of the 2014 Directives are transparency, 
equal treatment, non-discrimination, and open competition.  
3.282.   The public procurement directives provide, for public buyers in the EU, to accord to the 
works, supplies, services and economic operators of  the signatories to international agreements 
(such as the GPA and RTAs with procurement chapters), treatment that is no less favourable than 
the treatment accorded to the works, supplies, services and economic operators of the EU, insofar 
as these are cove red by these agreements .334 The 2014 Directives  are designed to achieve a 
procurement market that is competitive, open, and well regulated.  
3.283.   Previous reports outlined the changes introduced in the 2014 Directives335, which entered 
into force on 17 April 2014 with 24 months for transposition into domestic law by the member States, 
and 30 months for the provisions on e -procurement. As at end-September 2019, only one member 
State had yet to complete the transposition process for the 2014/23/EU Concessions Directive and 
the 2014/25/EU Utilities Directive .336 
3.284.   In October 2017, the Commission's public procurement strategy  was adopted , with the aim 
of further improving EU public procurement prac tices by working with public authorities and other 
                                                
329 European Commission, Making Public Procurement work in and for Europe . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=COM%3A2017%3A572%3AFIN . The ESI is composed of five funds: 
the European Regiona l Development Fund (ERDF) , the Cohesion Fund  (CF), the European Social Fund (ESF) , 
the European Agricultural Fund for Rural Development (EAFRD) , and the European Maritime and Fisheries Fund 
(EMFF) .  
330 Other public procurement related EU Directives: Directive 2009/81/EC on defence and sensitive 
security procurement; the Remedies Directive for the utilities sector (Directive 92/13/EEC) and the Remedies 
Directive for the public sector (Directive 89/665/E EC), as modified by Directive 2007/66/EC; and the 
EU Directive 2014/55/EU on electronic invoicing in public procurement.  
331 Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public 
procurement, repealing Directive 200 4/18/EC.  
332 Directive 2014/23/EU of the European Parliament and of the Council of 26 February 2014 on the 
award of concession contracts.  
333 Directive 2014/25/EU of the European Parliament and of the Council of 26 February 2014 on 
procurement by entities oper ating in the water, energy, transport and postal services sectors, repealing 
Directive 2004/17/EC.  
334 See in this regard Article 25 of Directive 2014/24/EU, Article 43 of Directive 2014/25/EU.  
335 WTO documents WT/TPR/S/317/Rev.1, 21 October 2015, Section 3.3 .2; and WT/TPR/S/357/Rev.1, 
13 October 2017, Section 3.3.7.  
336 European Commission, Public procurement: Commission refers 4 Member States to Court of Justice 
and opens a new case . Viewed at:  http://europa.eu/rapid/press -release_IP -17-4771_en.htm?locale=en . WT/TPR/S/395 • European Union  
 
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  stakeholders. The str ategy includes three initiatives: a mechanism for large infrastructure projects 
to provide clarity and guidance t o public authorities on public procurement; a recommendation to 
professionalize public buyers337; and a consultation on draft guidance on public  procurement of 
innovation was launched.338 These initiatives are discussed further below.  
3.285.   According to the Commissi on, the creation of a single EU procurement market has helped to 
improve and integrate further procurement markets of member States , as reflected in the fact that 
cross-border procurement (direct and indirect) has increased in recent years, to around 23% o f the 
total value of procurement in the EU.339 Some 55% of procurement procedures use lowest price as 
the only award criterion for public contracts, which may indicate that public buyers are not yet paying 
enough attention to quality, sustainability and inno vation. Similarly, only 11% of procedures are 
carried out by cooperative procurement , which may result in lost opportunities to benefit from 
economies of scale and exchange of know -how. Overall, i t is estimated that efficiency gains of 10% 
could save EUR 2 00 billion per  year, without cutting the level of service offered.340 
3.286.   Also, according to the Commission, i nnovation procurement is hampered by various barriers. 
One way of improving the situation could consist of a wider use of the innovation partnerships 
procedure. Awareness of this type of procedure is increasing and , to date, more than 200 innovation 
partnerships have been published in the TED. 
3.287.   The 2014 Directives mandate a gradual transition to e -procurement. The electronic 
publication of procurement noti ces ("eNotification") and electronic access to tender documents 
("eAccess") are mandatory since April 2016. The electronic submission of bids ("eSubmission") is 
mandatory since October 2018. Besides fulfilling these obligations, member States are using thi s 
opportunity to further enhance their eTendering systems, with the final aim of digitalizing the whole 
public procurement life -cycle.  
3.288.   Through Directive No. 2014/55/EU on electronic invoicing in public procurement, the 
Commission adopted a new European St andard which enables harmonization and interoperability at 
European level. Since 17 April 2019, all public administrations in Europe conducting public 
procurement must accept electronic invoices sent by their suppliers, which comply with this 
standard. In certain member States, a derogation for their sub -central authorities is in force until 
April 2020.341 
3.289.   The Commission  is currently taking steps to promote public procurement data -driven policies 
in member States. One such project is the European Commission award for better governance 
through procurement digitali zation, with three winners in 2018 (Italy for its contract register, 
Portugal for the BASE  portal, and Estonia for its public procurement register).342  
3.290.   To harmonize procedures and processes , the Commission  introduced the European Single 
Procurement Document (ESPD), which is a self -declaration form simplifying the participation of 
                                                
337 The recommendation encourages member States to take steps to ensure buyers have the necessary 
skills, knowled ge and integrity. The Commission will also facilitate the exchange of good practice and 
innovative approaches.  
338 European Commission, Making Public Procurement work in and for Europe . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=COM%3A2017%3A572%3AFIN . 
339 Direct cross -border procurement accounted for 3.5% of the total value of contracts in 2009 -15, while 
indirect cross -border procurement (through foreign subsidiaries) accounted for over 20%. These figures do not 
consider the increasing international trade within supply chains. European Commission, Making Public 
Procurement work in and for Europe . Viewed at: 
https://ec.europa.eu/transparency/regdoc/rep/1 /2017/EN/COM -2017-572-F1-EN-MAIN -PART-1.PDF . 
340 European Commission, Making Public Procurement work in and for Europe . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=COM%3A2017%3A572%3AFIN . 
341 According to Recital 35 of Directive 2014/55/EU, "this Directive is without prejudice to the right of 
the sender of the invoice to choose between submitting the invoice in accordance with the European standard 
on electronic invoicing, in accordance with national or other technical standards, or in paper format".  
342 European Commission, European Commission award for better governance through procurement 
digitalisation . Viewed at: https://ec.europa.eu/growth/content/european -commission -award -better -
governance -through -procurement -digitalisation_en . WT/TPR/S/395 • European Union  
 
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  suppliers in procurement procedures.343 The next step is ESPD int egration with national databases 
or eTendering platforms.344 
3.291.   The Commission  is also working on a new implementation regulation on public procurement 
standard forms ( "eForms ")345, a major update to the public procurement standard forms. The forms 
define how EU countries publish data on individual procurement contracts. This update will make it 
easier for companies to find contracts, increase transparency for citizens , and improve governments ' 
ability to make data -driven decisions on spending.  The eForms can be e asily mapped to other 
international standards, such as the Open Contracting Data Standard (OCDS).346  
3.292.   The EU is funding various  projects related to digital technologies , to enhance procurement, 
including the Digital Whistleblower project and others .347 Risk as sessment and good governance are 
to be improved through the comprehensive procurement contract registers. The Commission's 
multi-stakeholder expert group on e-procurement  (EXEP) published a report containing several 
recommendations on the creation of contract registers, concentrating on the structure, 
implementation, and management of contract registers and the importance of their integration in 
the TED.348 
3.293.   To address some of the procurement challenges, the new EU strategy focuses on six policy 
prioritie s (Box 3.3).  
Box 3.3 Government procurement strategic priorities  
Ensuring wider uptake of strategic public procurement  
• establish a voluntary ex-ante assessment mechanism for large infrastructure projects;  
• update guidance on green and social procurement , and provide guidance on innovation 
procurement ; and  
• exchange best practices regarding strategic procurement, including in key sectors (construction, 
healthcare, and information technology ( IT)).  
Professionaliz ing public buyers  
• adopt a recommendation on the professionalization of public buyers;  
• develop a European competence framework for public procurement , with the essential skills and 
competences procurers need;  
• create an e -competence cent re, as a central information portal , and an e -library of best practice on 
procurement; and  
• establish an EU -wide network of National Innovation Procurement Cent res.  
Improving access to procurement markets  
• further improve access to non -EU procurement markets through trade agreements;  
• rapid adoption of an international procurement instrument (IPI) (see below);  
• strengthen the remedies system by further networking of first instance review bodies and guidance 
notices on remedies; and  
• boost SME participation via business intermediarie s and innovation brokers (currently, SMEs win 
only 45% of the value of public contracts) .  
Increasing transparency, integrity and better data  
• issue new procurement standard forms to improve the collection of data;  
• promote the establishment of publicly accessible contract registers; and  
• provide guidelines on practical application of new integrity provisions and on exclusion grounds 
relating to collusion, and set  up a database on irregularities.  
                                                
343 European Commission, Establishing the s tandard form for the European Single Procurement Document . 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32016R0007 . 
344 European Commission, European Single Procurement Document and e -Certis . Viewed at: 
https://ec.europa.eu/growth/single -market/public -procurement/e -procurement/espd_en . 
345 European Commission, Standard forms for procurement notices. Viewed at:  
https://ec.europa.eu/info/law/better -regulation/initiatives/ares -2019-797630_en . 
346 Open Contracting Data Standard. Open Contracting Data Standard: Documentation.  Viewed at: 
http://standard.op en-contracting.org/latest/en/# . 
347 For an overview of all the different projects related to e -procurement in the EU, see European 
Commission. Other Initiatives . Viewed at: https://ec.europa.eu/growth/single -market/public -
procurement/e -procurement/projects_en .  
348 European Commission, Contract registers - EXEP subgroup report . Viewed at: 
https:// ec.europa.eu/docsroom/documents/26421 . WT/TPR/S/395 • European Union  
 
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  Boosting the digital transformation of procurement  
• extend the scope of the e -Certis tool and further improve IT systems; and  
• support the implementation of the E SPD, the "once-only" principl e and electronic invoicing in the 
member States.  
Cooperating to procure together  
• promote joint cross -border public procurement, including innovation by large buyers; and  
• launch pilot training on "SME-friendly Policies in Central Purchasing Bodies ". 
Source:  European Commission, Making Public Procurement work in and for Europe , Strasbourg, 
3 October  2017. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/ ?uri=COM%3A2017%3A572%3AFIN . 
3.294.   After the adoption of three new directives regulating public procurement transactions, the 
EU is currently concentrating on the  implementation  of the adopted rules. As shown in Box 3.3, soft  
tools, such as the recommendation on the professionalization of public buyers and the exchange of 
best practices, are the focus of policymaking in public procurement.  
3.295.   The voluntary ex-ante assessment mechanism for large infrastructure projects was 
introdu ced in October 2017.349 Currently, the mechanism has three elements: a helpdesk, a 
notification mechanism, and the possibility to exchange information (forum). The helpdesk is 
available for projects with a total estimated value of at least EUR 250 million, a nd the notification 
mechanism is for projects with a total estimated value exceeding EUR 500 million.350 
3.296.   The Commission recommendation on the professionalization of public procurement was 
adopted in October 2017351 as part of a package also containing a staff working document including 
a toolbox of best practices.352 The toolbox was digitalized in the form of an e -library, providing for 
the cross -fertilization of best practices in different aspects of public procurement.353 Another support 
tool for public buyers is  the e -Competence Centre. It provides information on, inter alia , green, 
innovative procurement, and on specific tools for procurement in the IT, healthcare and construction 
areas.354 
3.297.   The Commission also adopted Guidance on Innovation Procurement.355 The guida nce focuses 
on the creation of policy framework for innovation procurement. It walks through the different stages 
of such procurement, and contains references to examples of real procurement cases highlighting 
the positive outcome.  
3.298.   All procurement carried  out in the EU above the specified thresholds must comply with the 
requirements of the EU directives on procurement  that implement corresponding EU obligations 
under the GPA . The applicable thresholds were updated  with effect from 1 January 201 8 
(Table  3.28).356  
                                                
349 European Commission, Helping investment through a voluntary ex -ante assessment of the 
procurement aspects for large infrastructure projects. Viewed at: https://ec.europa.eu/growth/tools -
databases/pp -large-projects/ .  
350 According to footnotes 20 and 25 of COM(2017) 573 "A Member State can request the Commission 
to use the mechanism for any lower value infrastructure projects it considers to be of high importance for itself 
and/or the EU as a whole, fo r instance, for projects of common interest (PCI) in the field of the Trans -European 
Networks. Following reception of a request, the Commission will assess its admissibility, and inform the 
Member State on the conditions for its acceptance".  
351 Commission R ecommendation, Professionalisation of public procurement — Building an architecture 
for the professionalisation of public procurement . Viewed at: https://op.europa.eu/en/publication -detail/ -
/publication/94421013 -ab20-11e7-837e-01aa75ed71a1/language -en. 
352 European Commission, professionalisation of public procurement - Building an architecture for the  
professionalisation of public procure ment. Viewed at: 
https://ec.europa.eu/transparency/regdoc/rep/10102/2017/EN/SWD -2017-327-F1-EN-MAIN -PART-1.PDF . 
353 European Commission, E-library o f public procurement good practices . Viewed at: 
https://ec.europa.eu/regional_policy/en/policy/how/improving -investment/public -procurement/ e-library . 
354 European Commission, Support tools for public buyers: e -Competence Centre . Viewed at: 
https://ec.europa.eu/info/policies/public -procurement/su pport -tools-public -buyers_en . 
355 European Commission, Guidance on Innovation Procurement . Viewed at: 
https://ec.europa.eu/transparency/regdoc/rep/3/2018 /EN/C -2018-3051-F1-EN-MAIN -PART-1.PDF . 
356 See also the corresponding notification of thresholds in national currencies contained in 
WTO document GPA/THR/EU/1, 17 April 2018.  WT/TPR/S/395 • European Union  
 
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  Table 3.28 Public procurement thresholds from 1 January 2018  
(EUR) 
Directive  Type  Threshold  
Concessions Directive  
Directive 2014/23/EU and Commission Delegated Regulation (EU) 2015/2172 of 24 November 2015 
amending Directive 2014/23/EU of the European Parliament and of the Council in respect of the application 
thresholds for the procedures for the award of contracts  
 All works or services concessions  5,548,000  
Classical Directive (contracts for public works, public supply and public service)  
Directive 2014/24/EU and Commission Delegated Regulation (EU) 2015/2170 of 24 November 2015 
amending Directive 2014/24/EU of the European Parliament and of the Council in respect of the applica tion 
thresholds for the procedures for the award of contracts  
Central 
government 
authorities  Works contracts, subsidized works contracts  5,548,000  
All contracts concerning social and other specific services listed 
in Annex XIV  750,000  
All subsidized services  221,000  
All other service contracts and all design contests  144,000  
All supplies contracts awarded by contracting authorities not 
operating in the field of defence  144,000  
Supplies contracts awarded by contracting authorities 
operating in the field of defence  Annex III products 
144,000  
Other products 221,000  
Sub-central 
contracting 
authorities  Works contracts, subsidized works contracts  5,548,000  
All services concerning social and other specific services listed 
in Annex XIV  750,000  
All other service contracts, all design contests, subsidized 
service contracts, all supplies contracts  221,000  
Utilities (Sectors) Directive  
Directive 2014/25/EU and Commission Delegated Regulation (EU) 2015/2172 of 24 November 2015 
amending Directive 2014/23/EU of the European Parliament and of the Council in respect of the application 
thresholds for the procedures for the award of contracts  
 Works contracts  5,548,000  
 All services concerning social and other specific services listed 
in Annex XVII  1,000,000  
 All other services contracts, all design contests, all supplies 
contracts  443,000  
Source:  European Commission, Thresholds . Viewed at: https://ec.europa.eu/growth/single -market/public -
procurement/rules -implementation/thresholds_en . 
3.299.   Public procurement above the thresholds must be p ublished on the TED through a standard 
contract notice . A contracting authority may also publish a prior information notice (PIN) to announce 
a possible upcoming tender. Local and regional authorities may use the PIN as a call for tenders.  For 
public procu rement below the thresholds, national rules apply, and these national rules must respect 
the general principles of EU  law, including the TFEU principles of non -discrimination, equal 
treatment, transparency, mutual recognition, and proportionality.  
3.300.   Public a uthorities can choose among different procedures, including:  open procedure, when 
all eligible economic operators may submit a tender;  restricted procedure, when the contracting 
authority invites tenders from a selected group of those that respond to the call for competition ; 
competitive procedure with negotiation , which  is similar to a restricted procedure follow ed by 
negotiations with the selected economic operators; and c ompetitive dialogue, when the contracting 
authority enters into a dialogue with a se lection of the suppliers that responded to the call for 
competition  in order to find a suitable product or service to meet its needs. Tenders are then invited 
from a selection of bidders , and from i nnovation partnership s under which a selection is made fro m 
suppliers that responded to the call for competition  followed by negotiations for search and 
innovation projects aimed at meeting the needs identified by the contracting authority that cannot 
be met by existing solutions.357 
                                                
357 Directive No. 2014/23/EU.  WT/TPR/S/395 • European Union  
 
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  3.301.   In 201 8, the amount  of total ge neral government expenditure on works, goods, and services 
(excluding utilities) in the member States varied from as low as 7.4% of GDP in Ireland and 9.3 % 
in Lithuania , to 19.3% in the Netherlands and 17.7% in Finland ( Table 3. 29). 
Table 3.29 Estimated value of public procurement by general government, 2016 -18 
(EUR billion)  
 2016  2017  2018  
Estimated 
total value 
excluding 
utilitiesa % of GDP  Estimated 
total value 
excluding 
utilitiesa % of GDP Estimated 
total value 
excluding 
utilitiesa % of GDP  
EU-28 2,034.5  13.6 2,077.9  13.5 2,154.7  13.6 
Austria  47.3 13.2 49.0 13.2 50.5 13.1 
Belgium  61.1 14.2 63.0 14.1 66.5 14.5 
Bulgaria  4.7 9.6 4.9 9.4 5.6 10.0 
Croatia  6.5 14.0 6.4 13.1 7.1 13.8 
Cyprus  1.1 6.0 1.3 6.3 2.0 9.6 
Czech Republic  22.0 12.5 23.5 12.3 27.7 13.3 
Denmark  39.8 14.1 39.8 13.6 40.7 13.7 
Estonia  2.9 13.3 3.4 14.2 3.5 13.6 
Finland  38.7 17.8 39.9 17.7 41.6 17.7 
France  323.6  14.5 332.0  14.5 338.4  14.4 
Germany  495.1  15.8 514.3  15.8 534.9  16.0 
Greece  19.2 10.9 21.4 11.9 17.9 9.7 
Hungary  14.5 12.6 17.9 14.2 20.0 15.0 
Ireland  20.5 7.6 21.4 7.2 24.0 7.4 
Italy 179.1  10.6 181.6  10.5 184.3  10.4 
Latvia  2.7 10.7 3.1 11.5 3.6 12.4 
Lithuania  3.7 9.5 4.0 9.4 4.2 9.3 
Luxembourg  6.5 11.8 6.9 12.2 7.2 12.0 
Malta  1.0 9.2 1.1 9.4 1.3 10.4 
Netherlands  140.3  19.8 143.8  19.5 149.6  19.3 
Poland  45.8 10.7 52.4 11.2 60.5 12.2 
Portugal  16.6 8.9 17.6 9.0 18.5 9.1 
Romania  17.2 10.1 16.0 8.5 17.5 8.6 
Slovak Republic  11.5 14.2 11.9 14.1 12.8 14.3 
Slovenia  4.8 11.8 5.0 11.5 5.5 12.0 
Spain  109.4  9.8 112.6  9.7 118.3  9.8 
Sweden  76.3 16.4 77.7 16.2 77.5 16.5 
United Kingdom  322.6  13.2 306.0  12.9 313.3  13.0 
a Calculations based on the methodology applied in Government revenue, expenditure and main 
aggregates [gov_10a_main]; it is the sum of intermediate consumption (P2), Gross fixed capital 
formation (P51G), and social transfers in kind purchased market production, payable (D632PAY) for 
the general government  sector (referred to DG Grow (2016), Public Procurement Indicators 2015, 
DG GROW G4 – Innovative and e -Procurement). These estimates include expenditure on items 
which are exempt under the EU directives, such as contracts below the thresholds. They also in clude 
expenditure which may not be classified as public procurement, for example, the costs of health care 
and medical products reimbursed through statutory health insurance funds or by government.  
Source:  Eurostat, Government finance and EDP statistics (g ov_10a_main). Viewed at: 
https://ec.europa.eu/eurostat/web/government -finance -statistics/data/database; and National 
Accounts (including GDP). Viewed at: https://ec.europa.eu/eurostat/web/national -
accounts/data/database . Each public procurement procedure is subject to minimum time -limits for 
the submission of tenders. For example, after the publication of a contract notice under the open 
procedure, the minimum time -limit is 35 day s, but this can be reduced to 15 days if a PIN was 
published.  
3.302.   The methods for calculating the estimated valu e of a procurement are set out in the 
Directives358, and include aggregation rules intended to prevent a single public procurement 
                                                
358 Directive 2014/24/EU, Article 5; Directive 2014/23/EU, Article 8; and Directive 2014/25/EU, 
Article  16. WT/TPR/S/395 • European Union  
 
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  requirement being subdivided with the intention or effect of reducing the value below the threshold 
amounts. For example:  
• for framework agreements, and dynamic purchasing systems, the value should be the 
maximum estimated value , net of VAT , of all contracts envisaged for the total term;  
• for innovation partnerships, the value should be the maximum estimate d value , net of 
VAT, of research and development activities to take place during all stages of the 
envisaged partnership , as well as of the supplies, services or works to be developed and 
procured by the end of the partnership; and  
• for concessions, the value should be  the total turnover of the concessionaire generated 
over the duration of the contract, net of VAT, as estimated by the contracting authority or 
entity, in consideration for the works and services , object of the concession , as well as for 
supplies incidental to such works and services.  
3.303.   The contracting  authority may divide a procurement  into lots but, if the total value of these 
lots is greater than the threshold, then EU -level rules will apply to the awarding of each lot, e xcept 
for small lots, for which the amounts are below the following de minimis  levels:  
• EUR 80,000 for supplies or services; or  
• EUR 1 million for works; and  
• provided the aggregate value of the lots to be excluded from aggregation is no more than 
20% of the total value.  
3.304.   A simplified regime applies for contracts with an estimated value of less than EUR 750,000 
for services listed in Annex XIV of the Classical Directive  (social, health, cultural, and assimilated 
services; legal services; and hotel and restauran t services, and catering and canteen services ) with 
no procedural rules apart from the requirements for advance publication, equal treatment of bidders, 
and the announcement of the results.  
3.305.   In terms of contract award notices, in 201 8, 48% of the calls for  competition were for 
services, 17% for works, and 35% for goods. In terms of procedures, in 2018, 86.7% of the calls 
for competition  were under open procedure, 9.4%  were under negotiated proc edures with 
competition, and 3.5% were restricted procedures.359  
3.306.   The Remedies Directives360, as modified by Directive No. 2007/66/EC361, provide for legal 
remedies in cases of breaches of EU Public Procurement Directives. These remedies include a 
"standstill period", which requires contracting authorities to provide at leas t ten days' suspension 
after tender awards and before the public contract can be signed, and more stringent rules against 
illegal direct awards of public contracts so that they may be rendered ineffective by national courts.  
3.307.   In January 2017, the European C ommission reported to the European Parliament and the 
Council on the effectiveness of Directives 89/665/EEC and 92/13/EEC as amended by Directive 
2007/66/EC.362 According to the report, the Remedies Directives largely meet the objectives they 
were adopted for. In particular, they provide for an effective and rapid remedy while treating all 
suppliers equally.  
                                                
359 The information provided is based on internal EU calculations.  
360 Council Directive No. 92/13/EEC of 25 February 1992 coordinating the laws, regulatio ns and 
administrative provisions relating to the application of Community rules on the procurement procedures of 
entities operating in the water, energy, transport and telecommunications sectors; and Council Directive 
89/665/EEC of 21 December 1989 on the coordination of the laws, regulations and administrative provisions 
relating to the application of review procedures to the award of public supply and public works contracts.  
361 Council Directives 89/665/EEC and 92/13/EEC regarding improving the effectivene ss of review 
procedures concerning the award of public contracts, amended by Directives 2007/66/EC and 2014/23/EU.  
362 European Commission, on the effectiveness of Directive 89/665/EEC and Directive 92/13/EEC, as 
modified by Directive 2007/66/EC, concerning Review procedures in the area of Public Procurement. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52017DC0028&from=EN . WT/TPR/S/395 • European Union  
 
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  3.308.   As advised in the report, a network of first instance r eview bodies was set up to enable 
discussion of the ways such bodies can be made more efficient.363 The first meeting of the network 
took place in March 2017. As at April 2019, the network had had six meetings, discussing the 
digitalization of the process, e xchange of relevant information, and collection of data with regards 
to the functioning of national remedy systems.364 
3.309.   On 29 January 201 6, the Commission presented a revised  proposal  for an International 
Procurement Instrument ( IPI).365 The genesis of the IPI goes back to 2012 , and is rooted in a 
longstanding EU concern about international imbalance in public procurement markets.366 According 
to the Commission, the IPI would prom ote open access to public procurement markets around the 
world. It would allow the Commission to initiate public investigations in cases of alleged 
discrimination against  EU companies in procurement markets. According to the Commission , the 
existing EU com mitments, including in the GPA and bilateral trade agreements, would remain 
unaffected by the IPI. Recently, the European Council called for resuming discussions on the IPI.367 
The G PA 
3.310.   The EU is party to the revised WTO plurilateral GPA, adopted through Coun cil Decision 
2014/115/EU368, and its member States are covered by the revised GPA. As indicated in the previous 
Review, under the revised GPA, the EU extended its commitments to provide for further market 
access opportunities for suppliers offering goods and  services originating in GPA parties' economies. 
New sectors and contracting authorities/entities were included in the EU schedules, for example, the 
European External Action Service at EU level and several central governments contracting authorities 
and s ub-central entities of member States.369 
3.311.   In the context of its withdrawal from the EU, the United Kingdom applied for accession to 
the GPA (in its own right), through a communication from the EU on 1  June 2018.370 Its initial market 
access offer and its replie s to the Checklist of Issues were submitted by the EU on the same day.371 
A preliminary d iscussion on this accession was held at the Committee's informal session of  
27 June 2018. During that discussion, the United Kingdom expressed its strong desire to continue 
to participate in the GPA, without interruption, following its withdrawal from the EU , and expressed 
the hope that its accession process could be concluded swiftly.372 On 27 February 2019, the 
Committee adopted a decision setting out the terms of accession of the United  Kingdom to the GPA 
in its own right.373 According to the Committee 's decision (addendum) of 26 June 2019, the period 
                                                
363 European Commission, New EU network of review bodies to make public procurement remedies more 
efficient . Viewed at: https://ec.euro pa.eu/growth/content/new -eu-network -review -bodies -make -public -
procurement -remedies -more-efficient -0_en. 
364 European Commission, EU network of review bodies helps guarantee effective enforcement of public 
procurement rules . Viewed at: https://ec.europa.eu/growth/content/EU -network -review -bodies -helps -
guarantee -effective -enforcement -public -procurement -rules_en . 
365 Amende d proposal for a regulation of the European Parliament and of the Council on the access of 
third-country goods and services to the Union's internal market in public procurement and procedures 
supporting negotiations on access of Union goods and services to  the public procurement markets of third 
countries. European Commission, Access of third -country goods and services to the Union’s internal market in 
public procurement and procedures supporting negotiations on access of Union goods and services to the pub lic 
procurement markets of third countries . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52016PC0034&from=EN . 
366 Proposal for a regulation of the European Parliament and of the Council on the access of third -
country goods and services to the Union's internal market in public procurement and procedures supporting 
negotiations on access of Union goods and services to the public procurement markets of third countries. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52012PC0124&from=EN . 
367 European Pa rliament, Key issues in the European Council: State of play in June 2019 , p. 52. Viewed 
at: http://www.europarl.europa.eu/RegData/etudes/STUD/2019/631 754/EPRS_STU(2019)631754_EN.pdf . 
368 Council Decision 2014/115/EU: Council Decision of 2 December 2013 on the conclusion of the Protocol 
Amending the Agreement on Government Procurement.  
369 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, Section 3.3.7.2.  
370 WTO document GPA/146, 5 June 2018.  
371 WTO documents GPA/ACC/GBR/1, 5 June 2018; GPA/ACC/GBR/1/Rev.1, 14  June 2018; and 
GPA/ACC/GBR/2, 5 June 2018.  
372 WTO document GPA/W/347, 9 November 2018.  
373 WTO document GPA/CD/2, 28 February 2019.  WT/TPR/S/395 • European Union  
 
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  for submission of the United Kingdom's Instrument of Accession was extended by six months, until 
27 February 2020, unless further extended by the Committee374. 
Government procurement in RTAs  
3.312.   During the period under review, the EU has been active in concluding/implementing RTAs 
containing procurem ent chapters building or modelled on the provisions of the revised GPA. For 
example, t he CETA  contains a separate chapter on public procurement (Chapter 19). As both the EU 
and Canada are members to the GPA, the public procurement chapter builds on the GPA , including 
the structure of the Annexes. The coverage is enhanced in comparison with the GPA, with lower 
thresholds, fewer exceptions and more entities covered.  
3.313.   Similarly, the chapter on procurement of the EPA of the EU with Japan incorporates the GPA 
as part of the Agreement, and its norms apply mutatis mutandis .375 It goes beyond the text of the 
GPA, in that it puts in place further transparency mechanisms, refers more explicitly to 
environmental considerations, and sets additional norms on review mechanis ms. The parties also 
agreed to additional coverage. For instance, Japan opened its procurement market of the railway 
sector, hospitals, academic institutions and electricity distributors to EU economic operators.376 At 
the local and regional level, Japan ext ended the coverage to 54 "core cities" with more than 
300,000  inhabitants.377 The EU, in turn, offered Japan partial access to the procurement market of 
transportation equipment in cities, such as trains for metro systems and facilities for overland 
railways. Coverage was also enhanced through lowering the thresholds (on the part o f Japan) .378  
3.314.   The EU -Singapore FTA, signed in October 2018 and for which the European Parliament gave 
its consent on 13 February 2019 , contains procurement provisions based on the GPA (Chapter  9).379 
If the GPA is amended or superseded by another agreement, th e EU-Singapore FTA procurement 
chapter should be amended accordingly (Article 9.20). As is the case with the trade agreements with 
Japan and Canada, the FTA with Singapore enhances the coverage provided by the parties under 
the GPA. Thus, the EU listed add itional central governmental entities. Singapore included additional 
entities such as the Energy Market Authority, and subjected more services contracts to transparency 
and non -discrimination requirements. The applicable thresholds were also lowered.380 
3.315.   Another GPA party with whom the EU has deepened its trade relations is Armenia. The 
Comprehensive and Enhanced Partnership Agreement (CEPA) was signed in November 2017. 
Article  269 reaffirms the obligations and rights the EU and Armenia acquired under the GPA,  
including the Annexes to Appendix I. The CEPA takes a step forward by covering concession 
contracts, and regulating in detail the procurement review process based on the provisions of the 
Remedies Directive.  
3.316.   The EU is also including procurement chapters based on the GPA in its trade agreements 
with countries that are not currently GPA parties. One such country is Kazakhstan, with which the 
EU signed the Enhanced Partnership and Cooperation Agreement (EPCA) in December 2015, which 
is currently under ratifi cation by member States.381 The procurement chapter of the EPCA replicates 
the GPA. However, there is limited coverage of entities and higher thresholds than the ones usually 
seen in the GPA Parties' Annexes to Appendix I.  
                                                
374 WTO document GPA/CD/2/Add.1, 26 June 2019.  
375 Article 10.1 of the EU -Japan EPA. 
376 Annex 10 to the EU -Japan EPA. 
377 European Commission, Key elements of the EU -Japan Economic Partnership Agreement . Viewed at: 
http://europa.eu/rapid/press -release_MEMO -18-6784_en.htm . 
378 European Commission, An introduction to the EU -Japan Economic Partnership Agreement: Public 
Procurement . Viewed at: http://trade.ec.europa.eu/doclib/docs/2017/july/tradoc_155719.pdf . 
379 European Commission, Annex to the proposal for a Council Decision on the conclusion of the Free Trade 
Agreement betwee n the European Union and the Republic of Singapore . Viewed at: 
http://data.consilium.europa.eu/doc/document/ST -7967-2018-INIT/en/pdf . 
380 European Commission, European Unio n–Singapore: Trade and Investment Agreements . Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2019/february/tradoc_157684.pdf . 
381 EU member States are now ratifying the a greement. European Commission, Enhanced Partnership and 
Cooperation Agreement between the EU and its member States, of the one part, and the Republic of Kazakhstan, 
of the other part . European Commission. Viewed at: http://ec.europa.eu/trade/policy/countries -and-
regions/countries/kazakhstan/ . WT/TPR/S/395 • European Union  
 
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  3.317.   On 30 June 2019, the E U and Viet  Nam signed a trade agreement and an investment 
protection agreement. The trade agreement will open  up public procurement opportunities for both 
sides through GPA -based rules on public procurement and market access obligations concerning 
entities at central and sub -central level and entities operating in utilities sectors.  
3.318.   The EU previously signed "second generation" Association Agreements and Deep and 
Comprehensive Trade Agreements (AAs/DCFTAs)382 with Moldova, Georgia and Ukraine, containing 
similar chapters on procurement.383 These three countries are under obligations to gradually 
approximate their procurement legislation with the EU acquis , in accordance with the milestones and 
deadlines laid down in the roadmaps prepared by the implementing country.384 This pr ocess of 
gradual approximation with these requirements is  currently ongoing.  
3.3.7   Intellectual property rights  
3.319.   In a world of increasingly knowledge -based economies, in which companies heavily rely on 
innovation and creativity, as well as quality, the adequate p rotection and enforcement of intellectual 
property rights (IPRs) continue to play a key role for EU business to maintain its competitiveness. 
The economic importance of IPRs , both in terms of employment and contribution to GDP , was 
confirmed by a joint report by the European Patent Office (EPO) and the European Union Intellectual 
Property Office (EUIPO), released in September 2019.385 An overview of its main findings is provided  
in Table 3.30. It shows that an important share of total GDP, amounting to 4 4.8% on average during 
the period 201 4-16, was generated by IPR -intensive industries. The trademark -intensive industry 
made by far the biggest contribution both to employment and the EU's GDP, followed by the design - 
and patent -intensive industries.  
Table 3.30 Contribution of IP industries to employment, GDP , trade , and average wage 
premium of IP -intensive industries, 201 4-16 average  
IPR Share of 
total direct 
employment  
(%) Share of 
total direct 
and indirect 
employment 
(%) Share of 
total GDP  
(%) Average wage 
premium 
compared to 
non-IPR-
intensive 
industries  
(%) Exports  
(EUR 
million, 
2016) Imports  
(EUR 
million, 
2016) 
All IPR 
industries  29.2 38.9 44.8 47 2,122,465 1,940,510  
Copyright -
intensive 
industries  5.5 7.1 6.9 59 294,856 202,738 , 
Patent -
intensive 
industries  10.9 16.1 16.1 72 1,438,117 1,307,850 
Plant 
variety -
intensive 
industries  0.8 1.2 1.2 n.a. 7,552 3,885 
Trade 
mark-
intensive 
industries  21.7 30.2 37.3 48 1,275,472  1,261,002  
                                                
382 For more details on the three DCFTAs mentioned, see Wolczuk, K. (2017), Demystifying the Association 
Agreements: Review of Trilogy of Handbooks on the EU's Association Agreements and Deep and Comprehensive 
Free Trade Areas (DCFTAs) with Georgia, Moldova and Ukraine , 27 June 2017.  
383 European Parliamentary Research Service (2018), Association Agreements between the EU and 
Moldov a, Georgia and Ukraine: European Implementation Assessment , June 2018, pg. 8.  
384 Arts. 145 and 146 of the EU –Georgia DCFTA; Arts. 272 and 273 of the EU -Moldova DCFTA; and 
Arts. 152 and 153 of the EU -Ukraine DCFTA.  
385 EPO/EUIPO, IPR-intensive industries and  economic performance in the European Union - Industry -
Level Analysis Report,  3rd edition. Viewed at:  https://euipo.europa.eu/tunnel -
web/secure/webdav/gu est/document_library/observatory/documents/IPContributionStudy/IPR -
intensive_industries_and_economicin_EU/WEB_IPR_intensive_Report_2019.pdf . WT/TPR/S/395 • European Union  
 
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  IPR Share of 
total direct 
employment  
(%) Share of 
total direct 
and indirect 
employment 
(%) Share of 
total GDP  
(%) Average wage 
premium 
compared to 
non-IPR-
intensive 
industries  
(%) Exports  
(EUR 
million, 
2016) Imports  
(EUR 
million, 
2016) 
GI-
intensive 
industries  n.a. 0.2 0.1 29 12,923  1,335  
Design -
intensive 
industries  14.2 20.9 16.2 40 1,261,774  1,194,885  
n.a. Not applicable.  
Source:  IPR-intensive industries and economic performance in the European Union  - Industry -Level Analysis 
Report, joint EPO/EUIPO study, 3rd edition, September 2019.  
3.320.   During the re view period, a number of legislative measures were put in place that implement  
the initiatives annou nced in the Commission's comprehensive IP strategy , dating from  2011386, and 
the 2015 Commission's Digital Market387 and Single Market Strategies .388 These include the adoption 
of a copyright  reform package , with a focus on copyright -protected goods in the onlin e environment. 
The framework  putting into place the unitary patent  is pending ratification by relevant member 
States . Meanwhile, work progressed on the review of the IPR  enforcement regime, again with a 
focus on the need to adapt the regime to respond to c hallenges in the online environment. These 
measures and initiatives are discussed in more detail in the relevant sections below.  
3.321.   The IPR regime is governed by both EU legislation and legislation in member States. Based 
on Article 118 of the TFEU, the EU pu t in place an extensive body of IP R legislation. Table  A3.5 
provides  an overview of the principal legislative measures adopted by the EU  and their notification 
to the WTO. Member  States' legislation implements and complements, where appropriate, 
EU legislation and commitments under international agreements.  
3.322.   During the review period, the EU contributed constructively to discussions and work in the 
TRIPS Council.389 It submitted compr ehensive reports on its technical cooperation activities and on 
incentives provided to the private sector to transfer technology to LDCs,  for consideration by other 
WTO Members.390. 
3.323.   The EU is an observer to the World Intellectual Property Organization ( WIPO ), and its 
member States are also WIPO member States. Table  3.31 provides an overview of the status of the 
EU's participation in individual WIPO treaties , notably its recent acceptance of the Marrakesh 
Treaty .391 The EU and its member States392 are also contrac ting parties  to the International Union 
for the Protection of New Varieties of Plants (UPOV) . EU accession to the Geneva Act of the Lisbon 
Agreement on Appellations of Origin and Geographical Indications, proposed by the Commission in 
2018, is expected to take place in 2019.  
                                                
386 European Commission, Communication on a Single Market for IPRs . Viewed at: http://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52011DC0287&from=EN . See also the 2013 TPR Report, 
WT/TPR/S/284/Rev.2, 28 November 2013, para. 3.241.  
387 European Commission, A Digital S ingle Market Strategy for Europe . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?qid=1447773803386&uri=CELEX:52015DC0192 .  
388 European Commis sion, Upgrading the Single Market: more opportunities for people and business . 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX:52015DC0550 .  
389 WTO do cuments IP/C/W/652, 8 February 2019 and IP/C/W/653, 23 May 2019, as well as addenda 
thereto on public -private collaborations in innovation; IP/C/W/650, 31 May 2019; IP/C/W/648, 
19 October  2018; IP/C/W/642, 25 February 2018; and IP/C/W/641, 22 February 2018  on the societal value of 
IP in the new economy; and IP/C/W/638, 16 February 2018; IP/C/W/635, 9  October  2017; and IP/C/W/629, 
24 May 2017 on inclusive innovation and MSME growth.  
390 WTO documents IP/C/W/647/Add.6, 21 January 2019 and IP/C/W/632/Add.7, 22 F ebruary 2018 for 
notifications on technical assistance activities; and IP/C/W/646/Add.7, 29  January  2019, and 
IP/C/W/631/Add.7, 16 February 2018 for notifications on technology transfer.  
391 Marrakesh Treaty to Facilitate Access to Published Works for Person s Who Are Blind, Visually 
Impaired or Otherwise Print Disabled. Viewed at: https://www.wipo.int/treaties/en/ip/marrakesh/ . 
392 Except Cyprus, Greece, Luxembourg and Malta.  WT/TPR/S/395 • European Union  
 
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  Table 3.31 Status of participation in WIPO conventions and treaties  
Convention/treaty  Signed  Accepted  In force  
Beijing Treaty on Audiovisual Performances  19 June 2013    
Marrakesh Treaty  30 April 2014  1 October 2018  1 January 2019  
Trademark Law Treaty  30 June 1995    
WIPO Copyright Treaty  20 December 1996  14 December 2009  14 March 2010  
WIPO Performances and Phonograms Treaty  20 December 1996  14 December 2009  14 March 2010  
Hague Agreement   24 September 2007  1 January 2008  
Madrid Protocol   1 July 2004  1 October 2004  
Source:  WTO Secretariat.  
3.3.7.1   Copyright and related rights  
3.324.   For the EU economy, but also for its international competitiveness and cultural diversity, 
copyright and neighbouring rights continue to play a key role , in particular as regards the digital 
economy. Copyright -intensive industries accounted directly for 11.8 million jobs, or 5.5% of 
employment, in the EU during the period 2014 -16, and  indirectly for 15.3  million jobs, or 7.1% of 
total employment. Their share of total GDP during this period was 6.9%. The value of exports 
generated by copyright -intensive industries in 2016 was almost EUR  295 billion ( Table 3.30).   
3.325.   Digital technologies ar e having a strong impact on the development of the copyright -
intensive industry. More than half of the respondents to a survey carried out by the Commission 
from February  to March 2019 use the Internet to download or stream music, films or TV series. 
Music  is the most popular type of content accessed online or downloaded, with 59% of respondents 
indicating they had done so  within the year  preceding the survey (i.e. between early 2018 and early 
2019) , and 38% regularly. The proportion of respondents who say they download or stream music 
regularly grew by four percentage points since the previous survey on this subject in January 
2015.393 Overall, in 2018, paid streaming in Europe rose by 29.2%, whil e physical revenues fell by 
19.4% and downloads by 24.3% .394 
3.326.   The EU's legal framework ( acquis ) for copyright and neighbouring rights is shaped by a set 
of directives (to be) implemented by its member States (Table A3. 5). The overarching  objective of 
approximating the s tandards of protection is to create a sound basis for the free movement of 
protected creative works and services , offering access to these works within the internal market.  
3.327.   In the period under review, the EU adopted the following legislative measures: (i)  the 
Directive on copyright in the Digital Single Market; (ii) the Directive on television and radio 
programmes; (iii) the Regulation on cross -border portability of online subscriptions; and (iv) a 
Directive and a Regulation on the implementation of the Mar rakesh Treaty. Member States are due 
to implement the first two Directives by June 2021.  The deadline for them to transpose the Directive 
implementing the Marrakesh Treaty into national law was 11 October 2018.  
3.328.   The Directive on copyright in the Digital Si ngle Market395 is designed to further harmonize 
copyright and related rights in the EU, in particular with regard to digital and cross -border uses of 
protected content. It lays down exceptions and limitations to copyright and related rights to allow, 
with ap propriate safeguards, text and data mining, in particular for scientific purposes396, and to 
facilitate digital and cross -border teaching activities397, and the preservation and dissemination of 
European cultural heritage.398  
                                                
393 European Commission, Flash Eurobarometer 477a Report - Accessing content online and cross -
border portability of online content services . Viewed at: 
https://ec.europa.eu/commfrontoffice/publicopinion/index.cfm/survey/getsurveydetail/instruments/flash/surve
yky/2221 . 
394 IFPI, Global Music Report 2019 . Viewed at: https://www.ifpi.org/recording -industry -in-numbers.php . 
395 Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright 
and related rights in the Dig ital Single Market and amending Directives 96/9/EC and 2001/29/EC . Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32019L0790&from=EN . 
396 Arts. 3 and 4 of Directive (EU) 2019/790 .  
397 Art. 5 of Directive (EU) 2019/790 . 
398 Arts. 6 and 8(2) of Directive (EU) 2019/790 . WT/TPR/S/395 • European Union  
 
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  3.329.   The Directive furthermore contains measures to improve licensing practices, and ensure 
wider access to content, in particular as regards out -of-commerce works and works of visual art 
upon expiry of the original term of protection. For example, it requires member States to allow 
collective m anagement organizations  to conclude non -exclusive licences with cultural heritage 
institutions for non -commercial purposes for use throughout the EU. It introduces, subject to 
safeguards, collective licensing with an extended effect to include works by aut hors not having 
mandated collective management organizations to represent them. It seeks to enhance access to, 
and availability of, audiovisual works on video -on-demand platforms by requiring the establishment 
of impartial bodies or the appointment of medi ators to assist parties facing difficulties in concluding 
licensing agreements.  
3.330.   Importantly, the Directive introduces new measures to achieve a well -functioning 
marketplace for copyright. In that context, it protects the rights of publishers of press publ ications 
regarding the online use of their publications by information society service providers (as opposed 
to non -commercial uses of them by individual users, hyperlinking, and use of individual words or 
very short extracts).  
3.331.   It also addresses the use of  protected content by online service providers such as YouTube, 
Twitter, etc. Notably, under Article 17 of the Directive, online content -sharing service providers are 
held responsible for the sharing by users of copyright -protected materials with the publi c, and are 
obliged to seek relevant authorizations from right -holders. These authorizations then also cover 
non-commercial users. In the event of unauthorized dissemination, service providers are exempted 
from liability if they demonstrate that they have m ade the best effort to obtain authorization from 
the right -holder; and to make unavailable relevant works based on information provided by the 
right-holder and/or removed infringing content (including future uploads) after receiving a notice 
from the right -holder to this end. Less stringent requirements are placed on newly -established (less 
than three years of provision of services) providers with a turnover below EUR 10  million. Rather 
than a general monitoring obligation, requests for information by right -holders, and complaint and 
redress mechanisms for users, need to be established by online service providers. Exceptions and 
limitations, such as for use in the context of quotation, criticism, or review; and for the purpose of 
caricature, parody or pastic he, are expressly upheld.  
3.332.   Finally , the rights of authors and performers, in particular to appropriate and proportionate 
remuneration, are reaffirmed and protected through requirements for transparency and contract 
adjustment mechanisms, alternative disput e resolution , and rights of revocation in the event of lack 
of use.  
3.333.   The Directive  on television and radio programmes399 aims to make it easier to license 
television and radio programmes protected under copyright, thus contributing to their dissemination 
across the EU. This is achieved through: the facilitated clearance of copyright and related rights of 
radio and certain T V content; the establishment of the country of origin principle (so that copyright 
clearance is only required in the broadcaster's country of princip al establishment); and the extension 
of mandatory collective management to all types of retransmission. As a result, EU citizens are likely 
to have a wider choice of TV and radio programmes through retransmission of content online.  As 
highlighted in the joint statement of the Vice -President for the Digital Single Market and the 
Commissioner of the Digital Econo my and Society, " [t]he new rules will be particularly relevant for 
the 41% of Europeans who watch TV online but also for the linguistic minorities, as well as the 
20 million EU citizens who are living abroad in another EU country ".400  
3.334.   The EU introduced rules on cross -border portability of online content subscriptions.401 Since 
1 April 2018, service providers are prohibited from imposing additional charges on the use of the 
                                                
399 Directive (EU) 2019/789 of the European Parliament and of the Council of 17 April 2019 laying down 
rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting 
organisations and retransmissions of television and radio programmes, and amending Council Directive 
93/83/EEC . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019L0789&from=EN . 
400 European Commission, Commission welcomes European Parliament's vote on new rules facilitating 
access to online TV and ra dio content across borders . Viewed at: http://europa.eu/rapid/press -
release_STATEMENT -19-1888_en.htm . 
401 Regulation (EU) 2017/1128 of the European Parliament and of the Council of  14 June 2017 on 
cross-border portability of online content services in the internal market. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=uriserv:OJ.L_.2017.168.01.0001.01.ENG . WT/TPR/S/395 • European Union  
 
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  services if the user is temporarily outside of the member State of his/he r residence, meaning that 
citizens can travel with their subscriptions, such as HBO, Amazon Prime, Spotify, etc. The adoption 
of the Regulation was preceded by a survey, according to which one in every three European citizens 
wanted online portability of s ubscriptions.402 The European Parliament, the Presidency of the Council 
and the Commission, in their joint statement on the adoption of the regulation, expressed confidence 
that the broadcasters would use the "opportunity to enhance user experience".403 
3.335.   The Co mmission carried out a second evaluation of the "Database Directive", in force since 
1996.404 The evaluation largely concluded that the Directive is still effective, efficient, relevant, adds 
value and is coherent (even though some clarification on how it in teracts with the Public Sector 
Information Directive would be needed).405 
3.336.   The EU adopted a Directive and a Regulation implementing the Marrakesh Treaty, ratified 
by the EU on 1 October 2018 and aimed at giving blind, visually impaired or otherwise print disa bled 
people better access to printed materials. The Directive406 contains rules on the exceptions from the 
requirement to receive authorization from the right -holder of copyright or any related right. These 
exceptions apply to necessary accessible copy for the exclusive use of relevant beneficiaries. The 
Regulation407 allows for the cross -border exchange of otherwise copyright -protected accessible 
copies.  
3.3.7.2   Industrial property  
3.3.7.2.1   Patents  
3.337.   Patent -intensive industries are reported to have accounted for 16.1% of to tal employment 
in the EU and of total GDP during the period 2 014-16. Exports of patent -intensive industries 
amounted to EUR  1.4 trillion (Table 3 .30). 
3.338.   With 166,585  new patent applications in 2017, the EPO was among the top five offices that 
accounted  for a combined share of 8 4.5% of global patent applications. While China saw the fastest 
growth (+1 4.2%), the increase in filings at the EPO (+4. 5%) exceeded those in other patent offices, 
such as the United States  (+0.2%) and Japan  (+0.03%).408 In 201 8, the EPO granted 
127,580  patents, and received 173,958  applications.409 Most patent applications were in the fields 
                                                
402 European Commission, Cross -border portability of online content services . Viewed at: 
https://ec.europa.eu/digital -single -market/en/cross -border -portability -online -content -services . 
403 European Commission, Travel with your digital subscriptions: Joint statement by the European 
Commission, the European Parliam ent and the Bulgarian Presidency of the Council of the EU . Viewed at: 
http://europa.eu/rapid/press -release_STATEMENT -18-2341_en.htm . 
404 Directive 96/9/EC of the European Parliamen t and of the Council of 11 March 1996 on the legal 
protection of databases.  Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:31996L0009:E N:HTML . 
405 European Commission, Evaluation of the Directive 96/9/EC on the legal protection of databases.  
Viewed at: https://ec.europa.eu/digital -single -market/en/news/staff -working -document -and-executive -
summary -evaluation -directive -969ec -legal-protection . The conclusions of the Commission were supported by 
an external study and stakeholder consultations : Study in support of the Evaluation of the Database Directive . 
Viewed at: https://ec.europa.eu/digital -single -market/en/news/study -support -evalu ation-database -directive . 
Synopsis report on the responses to the public consultation activities on the evaluation of Directive 96/9/EC on 
the legal protection of databases.  Viewed at: https://ec.europa.eu/digital -single -market/en/news/synopsis -
report -public -consultation -evaluation -directive -969ec -legal-protection -databases . 
406 Directive (EU) 2017/1564 o f the European Parliament and of the Council of 13 September 2017 on 
certain permitted uses of certain works and other subject matter protected by copyright and related rights for 
the benefit of persons who are blind, visually impaired or otherwise print -disabled and amending Directive 
2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society. 
Viewed at: https: //eur-lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32017L1564&from=EN . 
407 Regulation (EU) 2017/1563 of the European Parliament and of the Council of 13 September 2017 on 
the cross -border exchange between the Union and third countries of accessible form at copies of certain works 
and other subject matter protected by copyright and related rights for the benefit of persons who are blind, 
visually impaired or otherwise print -disabled.  Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017R1563&from=EN . 
408 WIPO, World Intellectual Property Indicators 2018.  Viewed at: 
https://www.wipo.int/edocs/pubdocs/en/wipo_pub_941_2018.pdf . 
409 EPO Statistics  (status: 21 January 2019). Viewed at: https://www.epo.org/about -us/annual -reports -
statistics/statistics.html#granted . WT/TPR/S/395 • European Union  
 
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  of medical technology, digital communication s, and computer technology.  Applications granted by 
the EPO result in a bundle of national patents.  
3.339.   A regulation adopted in 2012 as part of the unitary patent package410 will allow right -holders 
to potentially receive patent protection in almost all EU member States, based on a single  request .411 
It will apply from the date of entry into force of the international Agreement on the Unified Patent 
Court (UPC Agreement) , the third component of the package . The UPC Agreement was signed by 
25 EU member States in early 2013.412 Ratification by 13 member States, including the 3 with the 
highest number of European patents in force (Germany, France and the United Kingdom ), is required 
for its entry into force . As at 30 September 2019, the Agreement had been ratified by 16 EU member 
States, including  France and the United Kingdom but not Germany.  
3.340.   As part of its Digital Single Market Strategy, the Commission continues to attach importance 
to removing unnecessary barriers in the market for the licensing of standard  essential patents 
(SEPs) . In November  2017, it published the Communication to the Institutions on Setting out the 
EU approach to Standard Essential Patents.413 It stresses the need , and makes proposals , for a more 
transparent environment for negotiations between SEP holders and potential licens ees, common 
valuation principles for SEP technology, and a balanced and predictable enforcement regime. 
Furthermore, the Commission published a study on licensing terms of S EPs, to contribute to a 
consistent framework for both the interpretation of Fair, R easonable and Non -Discriminatory 
(FRAND ) terms commitments and the definition of FRAND royalties.414 
3.341.   Regarding biotechnological inventions, in July 2017, the Administrative Council of the EPO 
adopted a decision amending relevant rules of the Implementing Reg ulations to the European Patent 
Convention (EPC).415 The amended rules clarify, inter alia , that "u nder Article 53(b)  EPC, European 
patents shall not be granted in respect of plants or animals exclusively obtained by means of an 
essentially biological process " (Rule 28 (2)). In a decision of 5 February 2019416, the EPO's Technical 
Board of Appeal found this amendment to be in conflict with Article 53(b) of the EPC as interpreted 
by the Enlarged Board of Appeal in  two decisions ("Tomatoes II" an d "Broccoli II" of 
                                                
410 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, paras. 3.270 -3.274.  
411 Regulation (EU) No. 1257/2012 of the European Parliament and of the  Council of 17 December 2012 
implementing enhanced cooperation in the area of the creation of unitary patent protection. Viewed at: 
https://eur -lex.europa.eu/l egal-content/EN/TXT/PDF/?uri=CELEX:32012R1257&from=EN . Another regulation 
deals with applicable translation arrangements ; Council Regulation (EU) No. 1260/2012 of 17 December 2012 
implementing enhanced cooperation in the area of the creation of unitary pat ent protection with regard to the 
applicable translation arrangements. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2012:361:008 9:0092:EN:PDF ; and WTO documents 
WT/TPR/S/284/Rev.2, 28 November 2013, paras. 3.257 -3.267 and WT/TPR/S/357/Rev.1, 13  October 2017, 
paras. 3.270 -3.274.  
412 The text of the Agreement on a Unified Patent Court can be accessed at: http://eur -lex.europa.eu/ 
LexUriServ/LexUriServ.do?uri=OJ:C:2013:175:0001:0040:EN:PDF . 
413 European Commission, Communication to the Institutions on Setting out the EU approach to 
Stand ard Essential Patents . Viewed at: https://ec.europa.eu/docsroom/documents/26583 . 
414 Pentheroudakis, C. and Baron, J.A. (2017) Licensing Terms of Standard Essential Patents. A 
Comprehensive Analysis of Cases . JRC Science for Policy Report. EUR 28302 EN; doi:10.2791/32230. Viewed 
at: http://publications.jrc.ec.europa.eu/repo sitory/bitstream/JRC104068/jrc104068%20online.pdf . 
415 EPO, Decision of the Administrative Council of 29 June 2017 amending Rules 27 and 28 of the 
Implementing Regulations to the European Patent Convention (CA/D 6/17).  Viewed at: 
https://www.epo.org/law -practice/legal -texts/official -journal/2017/07/a56.html . 
416 See Case T 1063/18. Viewed at: 
http://documents.epo.org/projects/babylon/eponet.nsf/0/426B74FD32463ACEC1258398003EA3F4/$File/T_106
3-18_en.pdf . See also EPO, Written decision in case T 1063/18 on the patentability of plants issued.  Viewe d at: 
https://www.epo.org/law -practice/case -law-appeals/communications/2019/20190205.html . In its decision, the 
EPO's Enlarged Board of Appeal states that " [a]lthough the Administrative Council is […] competent to amend 
the Implementing Regulations pursuant to Article 33(1)(c) EPC, this competence does not extend to amending 
an Article of the Convention".  WT/TPR/S/395 • European Union  
 
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  25 March  2015).417 The President of the EPO subsequently referred the decision of the Technical 
Board to the EPO's Enlarged Board of Appeal , aiming to reverse it.418  
Supplementary protection certificates  
3.342.   The EU legal framework offers supple mentary protection certificates (SPCs) for medicinal 
products (Regulation (EC) No. 469/2009) and plant -protection products (Regulation (EC) 
No. 1610/96) as a sui generis  IP category that only applies after expiry of the basic patent.419 In 
other words, they are considered as legally distinct from patent protection, including international 
obligations in this regard, and may therefore be subject to wider exceptions than patent rights 
themselves. Following up on a Commission proposal of 28  May 2018420, the EU co -legislators 
adopted Regulation (EU) 2019/933 amending Regulation (EC) No. 469/2009 concerning the 
supplementary protection certificate for medicinal products421, introducing an exception to let firms 
established in the EU manufacture certain pharmaceutical p roducts for export to non -EU markets 
during the term of the SPC. It also permits the making and stockpiling of a pharmaceutical product 
six months prior to the expiry of the certificate, in order to place it on the market of EU  member 
States immediately af ter expiry of the certificate. These provisions have been described as means 
to level the playing field for Europe -based generic and biosimilar manufacturers in light of a lack of 
international binding rules on SPCs .422 Comparable exceptions were included in  recent FTAs such as 
the CETA.423  
3.343.   The regulations in those areas create binding rules at the EU level, while other areas are 
subject to the applicable national legislation of the EU member States. No " unitary SPC " that would 
apply to future unitary patents is foreseen in the regulatory package adopted and awaiting entry 
into force. T he Commission is working on the relationship between  unitary patent protection and 
SPC legislation .424  
3.344.   Several studies have been concluded on legal and economic aspects of SPCs. T hese include 
a study on the legal aspects of SPCs in the EU425, a study of the economic impact of SPCs, 
                                                
417 Cases G 2/12 and G 2/13. They can be accessed at the  EPO Board of Appeal decisions database at: 
http://www.epo.org/law -practice/case -law-appeals/advanced -search.html . In those decisions, the Enlarged 
Board of Appeal held t hat exclusion of essentially biological processes from patentability did not preclude the 
grant of patents for plants and plant material obtained from such processes, provided the basic patentability 
criteria were met. See also WT/TPR/S/357/Rev.1, 13 Octob er 2017, paras. 3.275 -3.278.  
418 On the issue of the non -patentability of essentially biological processes, which is supported by EU 
institutions and member States, see also Commission Notice on certain articles of Directive 98/44/EC of the 
European Parliame nt and of the Council on the legal protection of biotechnological inventions . Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52016XC1108(01)&from=EN . 
419 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, paras. 3.282 -3.287.  
420 Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC ) 
No. 469/2009 concerning the supplementary protection certificate for medicinal products . Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=COM%3A2018% 3A317%3AFIN . This initiative was first 
considered in the Upgrading the Single Market Strategy of 2015, in the context of a targeted recalibration of 
certain aspects of patent and SPC protection. It is supported by a series of studies and was the subject of  a 
public consultation in October 2017 . 
421 Regulation (EU) 2019/933 of the European Parliament and of the Council of 20 May 2019 amending 
Regulation (EC) No. 469/2009 concerning the supplementary protection certificate for medicinal products. 
Viewed at: http://data.europa.eu/eli/reg/2019/933/oj . 
422 European Commission, Commission Staff Working Document - Impact Assessment Accompanying the 
document Proposal for a Regulation of the European Parliament an d of the Council amending Regulation (EC) 
No. 469/2009 concerning the supplementary protection certificate for medicinal products , p. 18. Viewed at: 
https://eur -lex.europa.eu/LexUriServ/LexUriServ.do?uri=SWD:2018:0240:FIN:EN:PDF . 
423 Article 20.27(9), CETA. Viewed at: 
https://trade.ec.europa.eu/doclib/docs/2016/february/tradoc_154329.pdf . 
424 European Commission, Supplementary protection certificates for pharmaceutical and plant protectio n 
products . Viewed at: https://ec.europa.eu/growth/industry/intellectual -property/patents/supplementary -
protection -certificates_en . 
425 European Commission, Study and annexes on the legal aspects of Supplementary Protection 
Certificates in the EU . Viewed at: https://ec.europa.eu/docsroom/documents/29524 . WT/TPR/S/395 • European Union  
 
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  pharmaceutical incentives and rewards in Europe426, and a study on the economic impacts of 
changing exemption provisions during patent and SPC protection in  Europe.427 
3.3.7.2.2   Plant variety rights  
3.345.   According to the joint EPO/EUIPO report of September 2019 , the plant variety rights -
intensive industries directly and indirectly accounted for about 2.6 million jobs on average between 
2014 and 201 6, which represented a share of 1.2% of total direct employment in the EU. In the 
same period, these industries  accounted for 1.2% of the total GDP (Table 3. 30). 
3.346.   Plant varieties can be protected either under national plant variety right systems or as a 
Comm unity Plant Variety Right (CPVR).428 As regards the latter, Council Regulation (EC) No. 2100/94 
on CPVRs429 established a separate regime that provides for a unitary right to exploit a plant variety 
with effect across the EU via a single application to the Community Plant Variety Office (CPVO ). The 
term of protection is 25 years, and 30 years in the case of potato, vine and tree varieties, extendable 
for a further 5 years in certain cases. National plant variety rights or patents cannot coexist with 
CPVRs ; when  a CPVR is granted, the corresponding national title becomes ineffective as long as the 
CPVR is in force.  
3.347.   CPVRs are granted and administered by the CPVO. On 31 December 201 8, 26,896 titles were 
in force, with 2, 757 titles granted in 201 8 alone, which repre sented a slight decrease as compared 
to 201 6 (2,980) and 2017 (2,865) .430 Just under half  of the titles in force were for ornamental crops, 
while the fruit sector ranked last , with only 1, 879 titles.  
3.348.   Building on reforms of the fees payable to the CPVO descri bed in the previous Review431, the 
CPVO, in the current reporting period, updated the "Notes for applicants ", e.g. in respect of the due 
date for payment of the examination fees.432 The CPVO also intensified international cooperation by 
concluding administrative a rrangement s with plant variety protection agencies in China, 
Chinese  Taipei, and the African Regional Intellectual Property Organi zation.  
3.3.7.2.3   Trademarks  
3.349.   Among the IPR -intensive  industries, the trademark -intensive industr ies contributed the 
biggest share to employment and GDP in the EU. During the period 2014 -16, more than 46 million 
people  were directly employed in this sector, and nearly 20 million more depended indirectly on 
these industr ies. This represented 30% of total direct and indirect employment on average from 
2014 to 201 6. The sector 's share of  total GDP  was 37% during this period, and the value of exports 
generated by t he trademark -intensive industr ies was EUR  1.28 trillion in 201 6 (Table 3. 30). 
3.350.   Trademarks can be registered in the EU either under national trademark  systems or under 
the EU trademark system, which provides the right -holder with EU -wide protection by means of 
a single registration at the EUIPO.433 Since the  EU's adherence to the Madrid Protocol in 2004, 
international registration of a trademark at WIPO is also available to persons seeking protection in 
any country that is a signatory of the Madrid Protocol.  
3.351.   In 2018, the EUIPO received 152,494  European Union trademark (EUTM) applications, which 
was 4.1% more than in 2017 ( 146,443  applications) and shows a steady increase over time 
                                                
426 European Commission,  Study of the economic impact of supplementary protection certificates, 
pharmaceutical incentives and rewards in Europe . Viewed at: 
https://ec.europa.eu/docsroom/documents/29521 . 
427 Publications Office of the European Union, Assessing the economic impacts of changing exemption 
provisions during patent and SPC protection in Europe . Viewed at: 
https://publications.europa.eu/en/publication -detail/ -/publication/6e4ce9f8 -aa41-11e7-837e-
01aa75ed71a1/language -en. 
428 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, paras. 3.285 -3.290.  
429 Council Regulation (EC) No . 2100/94 of 27 July 1994 on Community plant variety rights. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/ALL/?uri=CELEX%3A31994R2100 . 
430 CPVO Statistics . Viewed  at: https://cpvo.europa.eu/en/statistics . 
431 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, paras. 3.285 -3.290.  
432 CPVO, Filing an application. Viewed at: http://cpvo.europa.eu/en/applications -and-
examinations/filing -application . 
433 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, pp. 119 et seq.  WT/TPR/S/395 • European Union  
 
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  (135,377  applications in 2016) .434 Virtually all application filings are electronic ( 99.75  % in 2018). 
Direct applications amount ed to 127,323  in 2018 , and applications for international registrations to 
25,171 , equivalent to 16. 5% of the total number of applications . In terms of processing, a s in 
previous years, the number of EUTMs registered, published and examined reported steady increases 
(close to 2% on average)  in 2018 . 
3.352.   During  the review  period, the EUTM  regime witnessed  the implementation of  a substantive 
trade mark reform package , adopted in December 2015  in the form of a regulation modernizing the 
rules on EU -wide trademarks administered by the EU, and a directive further harmonizing national 
trademark law . Regulation (EU) 2015/2424435 amend ed the legal framework  for EUTMs  (formerly 
Community trademarks) administered by the EUIPO (formerly known as the Office for Harmonization 
in the Internal Market) and entered into force on 23 March 2016 .436 A number of provisions were 
applied  from 1 October 2017, as they had to b e developed by secondary legislation . The applicable 
legal rules were codified by Regulation (EU) 2017/1001 on the European Union trade mark .437 The 
latest secondary legislation consists of the Delegated Regulation (EU) 2018/625438 supplementing 
Regulation (EU) 2017/1001 (EUTMDR), and the Implementing Regulation (EU) 2018/626439 laying 
down detailed rules for implementing certain provisions of Regulation (EU) 2017/1001 (EUTMIR).  
3.353.   Among others, the 2017 Regulation  and its delegating an d implementing regulations 
introduced the EU certification mark .440 This is defined as a mark that is "capable of distinguishing 
goods or services which are certified by the proprietor of the mark in respect of material, mode of 
manufacture of goods or perfo rmance of services, quality, accuracy or other characteristics, with the 
exception of geographical origin, from goods and services which are not so certified" . It thus provides 
a guarantee of the specific characteristics of certain goods and services , irrespective of the identity 
of the undertaking that actually produces or provides the goods and services at issue. The role of 
the certification mark owner is to control the compliance of the goods and services with a given 
standard set out in the regulations  of use of the certification mark.  
3.354.   The new rules also remove d the graphical representation requirement  for trademarks .441 
Instead,  signs can be represented in any appropriate form using generally -available technology, as 
long as the representation is clear, precise, self -contained, easily accessible, intelligible, durable and 
objective. This enables applicants to use electronic file formats, e.g. widely -used image and sound 
file formats such as jpeg and mp3, in the registration process. The new requirements a re intended 
to modernize the system, and to reduce the rate of objections related to formalities.  
3.355.   The new legislation on the EUTM  also streamlined the procedures before the EUIPO and 
modernized them to take into account the use of IT.442 In that vein, priori ty claims are no longer 
examined in substance, but remain as a "mere" claim until relied upon. Applicants can invoke 
acquired distinctiveness as a subsidiary claim, allowing them to only incur the expense of gathering 
and presenting evidence of use , if nec essary , if they are notified of a negative final decision on 
                                                
434 EUIPO, 2018 Annual Report . Viewed at: https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/contentPdfs/about_euipo/annual_report/annual_report_2018_en.
pdf. 
435 Regulation (EU) 2015/2424 of the European Parliament and of the Council of 16 December 2015 
amending Council Regulation (EC) No. 207/2009 on the Community trade mark  and Commission  Regulation 
(EC) No. 2868/95 implementing Council Regulation (EC) No. 40/94 on the Community trade mark, and 
repealing Commission Regulation (EC) No. 2869/95 on the fees payable to the Office for Harmonization in the 
Internal Market.  Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32015R2424 . 
436 For a detailed description of the changes introduced by the Regulation, see WTO document 
WT/TPR/S/357/Rev.1, 13 October 2017, pp. 119 et seq.  
437 Regulation ( EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the 
European Union trade mark. Viewed at: http://data.europa.eu/eli/reg/2017/1001/oj . 
438 Commission Delegated Regulatio n (EU) 2018/625 of 5 March 2018 supplementing Regulation (EU) 
2017/1001 of the European Parliament and of the Council on the European Union trade mark, and repealing 
Delegated Regulation (EU) 2017/1430. Viewed at: http://data.europa.eu/eli/reg_del/2018/625/oj . 
439 Commission Implementing Regulation (EU) 2018/626 of 5 March 2018 laying down detailed rules for 
implementing certain provisions of Regulation (EU) 2017/1001 of the European Parliament and  of the Council 
on the European Union trade mark, and repealing Implementing Regulation (EU) 2017/1431. Viewed at: 
http://data.europa.eu/eli/reg_impl/2018/626/oj . 
440 EUIPO, Certification marks. Viewed at: https://euipo.europa.eu/ohimportal/en/certification -marks . 
441 EUIPO, Graphical Representation – Types of mark. Viewed at: 
https://euipo.europa.eu/ohimportal/en/elimination -of-graphical -representation -requirement . 
442 EUIPO, Procedural changes. Viewed at: https://euipo.europa.eu/ohimportal/en/procedural -changes . WT/TPR/S/395 • European Union  
 
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  inherent distinctiveness as primary claim. Furthermore, opposition or cancellation claims can be 
substantiated with reference to online sources recogni zed by the Office (e.g. the databases of the  
national and regional EU IP offices). Assignment is recognized as an alternative remedy to 
invalidating a trademark registered without the authorization of the proprietor. Other changes 
concern the reordering and clarification of provisions on opposition/ cancellation proceedings and 
Boards of Appeal; the simplification of language and translation requirements ; and the 
modernization of provisions on communication with the office.  
3.356.   In order to further harmonize the national framework s for trademark regimes in EU member 
States , which coexist with the EU trademark regime , the European Parliament and the Council 
adopted Directive (EU) 2015/2436  to approximate the laws of the member States relating to 
trademarks .443 The Directive entered into force on 12 January 2016; member States had until 
14 January 2019 to transpose it into national law.  Most member States have notified complete 
transposition.  
3.3.7.2.4   Geographical indications  
3.357.   According to the joint EPO/EUIPO report of September  2019, GI-intensive industries 
generated 0.1%  of overall GDP in the period 201 4-16 and represented a 0.2% share of total 
employment. The value of exports of these industries in 2 016 was nearly EUR 13 billion 
(Table  3.30).444 
3.358.   While the harmonization of the protection of GIs within the EU is advanced with regard to 
agricultural products445, that for non -agricultural products is currently only available at the national  
level in a number of member States. Protection for agricultural products at the EU  level can be 
obtained in one of the following ways: as a protected designation of origin (PDO) or a protected GI 
(PGI) for wines and agricultural products and foodstuffs, or as a GI for spiri ts and aromatized 
wines .446  
3.359.   As regards GIs of products of non -EU origin, they may be protected in the EU either through 
direct application or by means of inclusion in FTAs. In the former, the application may be sent either 
directly, or through the authoriti es of the country where the geographical area is located, to the 
Commission. No  fees are required for applications from third countries.  
3.360.   In April 2019, the new public database "eAmbrosia - the EU geographical indications register " 
was launched. It is d esigned to replace the current databases for wine (e -Bacchus), spirits 
(e-Spirit -Drinks) and food ( DOOR ).447 It provides  access to information on all G Is registered , 
including their country of origin, status (applied, published or registered), their product specification, 
and a direct link to the legal basis when they were officially protected.448 The register contains 
1,605  registered wine GIs and 239 registered spirit drink GIs. All wine and spirit drink GIs registered 
                                                
443 Directive (EU) 2015/2436 of the European Parliament and of the Council of 16 December 2015 to 
approximate the laws of the Member States relating  to trade marks. Viewed at: 
http://data.europa.eu/eli/dir/2015/2436/oj . 
444 The previous Review observed that about 20% of total sales of EU GI products are exported outside 
the EU, between 25% and 3 0% of processed agricultural products are covered by GIs, and 80% of total wine 
exports and almost all spirits exports are also covered by GIs. WTO document WT/TPR/S/357/Rev.1, 
13 October 2017, para. 3.303.  
445 For an overview of EU member States' GI protec tion and enforcement systems, see EUIPO, 
Protection and Control of Geographical Indications for Agricultural Products in the EU Member States.  Viewed 
at: https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/observatory/documents/reports/Enforcement_of_GIs/EUIPO_Geo
graphical_Indications_full_report_en.pdf . 
446 For an overview of relevant legislation, databases and procedures, see previous Reviews and 
references cited therein, in particular WTO document WT/TPR/S/357/Rev.1, paras. 3.302 -3.315. See also WTO 
document IP/C/M/86/Add.1, para. 6, for a statement by t he EU to the TRIPS Council introducing Regulation 
251/2014 on Geographical Indications for Aromatized Wine Products.  
447 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, para. 3.309.  
448 European Commission, New database for EU geographical indications aims t o increase transparency 
and simplify search. Viewed at: https://ec.europa.eu/info/news/new -database -eu-geographical -indications -
aims-increase -transparency -and-simplify -search -2019-apr-01_en . The register can be viewed at: 
https://ec.europa.eu/info/food -farming -fisheries/food -safety -and-quality/certification/quality -
labels/geographical -indications -register/ . WT/TPR/S/395 • European Union  
 
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  directly via EU regulations are listed i n eAmbrosia, including third -country GIs.449 Agricultural 
product and foodstuff GIs (currently in the DOOR database) will be incorporated in eAmbrosia by 
the end of 2019.  
3.361.   Given the importance of GIs for the EU's external trade, the Commission sought to incl ude 
a comprehensive section on GI protection for agricultural products in the more recent generation of 
FTAs. As a consequence, a large number of EU and third -country GIs are now protected through 
bilateral and regional agreements.450 The following agreement s with GI coverage were finalized or 
have entered into force since the last Review:  
• the EU -Japan EPA recognizes the special status of, and offers protection on the Japanese 
market to, 210 European agricultural GIs . In turn, the EU offers protection for 56 Japanese 
foodstuff, wine or spirit names;  
• the draft FTA between the EU and Singapore provides that Singapore will strengthen its 
existing GI regime by setting up a system to register GIs in Singapore. Once registered in 
Singapore, around 190 GIs for wines , spirits and certain agricultural products will enjoy 
levels of protection equal to those in the EU;  
• once in force, the FTA between the EU and Viet Nam will protect 169 European and 
39 Vietnamese GIs451; and  
• the agreement in principle reached by the EU and Mercosur in June 2019 on the trade part  
of an agreement foresees the protection of some 350 European G Is. The EU will also 
protect some 220 names of traditional Mercosur products such as Cachaça (a Brazilian 
distilled spirit) or Mendoza wine from Argentina .452 
3.362.   With regard to non -agricultural products, the EU commissioned a s tudy on economic aspects 
of GI protection at the EU level , in order to (i) evaluate the effectiveness of specific GI protection in 
limiting the availability of non -authentic products; (ii)  assess the value of this specific GI protection 
to consumers, and the impact on consumer search costs for authentic products with and without 
explicit GI protection; and (iii) identify the value of this specific GI protection to producers of 
authentic geo graphically -rooted products.453 The results of the study are planned for publication in 
2020.  GIs for non -agricultural products may also be protected as collective EU trademarks454, and 
under unfair competition laws.  
3.3.7.2.5   Undisclosed information  
3.3.7.2.5.1   Trade secrets  
3.363.   EU member States had until June 2018 to implement the Directive  on the Protection of 
Undisclosed Know -How and Business Information (Trade Secrets) Against Their Unlawful Acquisition, 
Use and Disclosure  (the Trade Secrets Directive).455 All but one me mber States have adopted 
legislation in order to align their legal framework to the Directive.  
                                                
449 The third -country GIs protected through agreements are listed on the europa website under the link: 
https://ec.europa.eu/info/sites/info/files/food -farming -fisheries/food_safety_and_quality/docu ments/list -gis-
non-eu-countries -protected -in-eu_en.pdf . 
450 For a list of earlier agreements, see previous Review, WTO document WT/TPR/S/357/Rev.1, 13 
October 2017, paras. 3.312 et seq.  
451 For further details, see also the previous Review, WTO document WT/TPR /S/357/Rev.1, 
13 October  2017, para. 3.312.  
452 European Commission, Key elements of the EU -Mercosur trade agreement. Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=2040 . 
453 European Commission, Study: Economic aspects of geographical indication protection at EU level for 
non-agricultural products.  Viewed at: https://ec.europa.eu/growth/content/study -economic -aspects -
geographical -indication -protection -eu-level-non-agricultural -products_en . 
454 WTO document WT/TPR/S/284/Rev.2, 28  November 2013, para. 3.287.  
455 Directive (EU) 2016/943 of the European Parliament and of the Council of 8 June 2016 on the 
protection of undisclosed know -how and business information  (trade secrets) against their unlawful acquisition, 
use and disclosure. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32016L0943&fr om=EN . WT/TPR/S/395 • European Union  
 
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  3.364.   In the reporting period, the Commission held a workshop and published a study on cyber 
theft of trade secrets.456 The study includes research on the estimated volu me and impact of cyber 
theft of trade secrets.  Based on a reported increased risk of this type of theft to the detriment of 
European businesses, it recommends taking measures to enhance a wareness and training , 
facilitat ing businesses in addressing the chal lenge , enhanc ing institutional capabilities , and  
strengthen ing law enforcement . The European IP Helpdesk published a factsheet on trade secrets to 
help businesses protect their rights.457 
3.365.   Furthermore, a special study was also carried out regarding trade secr et litigation.458 It 
provides a description of all 28 EU member States'  legal systems for the protection of trade secrets , 
prior to the implementation of the Trade Secret Directive, and a comparative overview of national 
case law is provided in a dedicated s ection . Overall, it finds that there is considerable divergence 
between member States in terms of their national definition of trade secrets, the scope of protection , 
the sources of law , and the availability of case law.  
3.3.7.2.5.2   Clinical trial data  
3.366.   The EU legal f ramework on the protection of clinical trial data, as required by Article 39.3 of 
TRIPS, provides for a regime of exclusivity periods of eight plus two plus one years , during which 
generic manufacturers cannot rely on the data submitted by the originator c ompany to the regulatory 
authorities, nor market the generic product.459 This general regime of data and marketing exclusivity 
serves, inter alia , to facilitate the introduction of an open access regime, and important initiatives 
were undertaken in the EU wi th regard to the publication of clinical trial data.  
3.367.   On 10 April 2019 , the Commission published a Question & Answer document460 on the 
interplay between the General Data Protection Regulation 2016/679  (GDPR),  which entered into 
force on 25  May 2018, and the Clinical Trials Regulation 536/2014 (CTR).461 The CTR entered into 
force on 16  June 2014 but will only apply  once relevant registers have been established.462 A further 
Delegated Regulation was adopted in 2017.463 The requirements for publishing clinical trial summary 
results in the EU Clinical Trials Database are included in the European Commission Guideline 
2012/302 03/EC464. It is the responsibility of sponsors to ensure that the protocol information and 
results of all clinical trials are submitted to the EU Clinical Trials Database (EudraCT); this 
                                                
456 European Commission, Study on The scale and impact of industrial espionage and theft of trade 
secrets through cyber . Viewed at: https://ec.europa.eu/docsroom/documents/34841 . 
457 European  IP Helpdesk, Trade secrets: An efficient tool for competitiveness . Viewed at: 
http://iprhelpdesk.eu/Fact -Sheet -Trade -Secrets -Efficient -Tool-Competitiveness . 
458 KPMG/EUIPO, The Baseline of Trade Secrets Litigation in the EU Member States . Viewed at: 
https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/observatory/documents/reports/2018_Baseline_of_Trade_Secrets
_Litigations_in_EU_Member_States/2018_Base line_of_Trade_Secrets_Litigations_in_EU_Member_States_EN.p
df. 
459 Directive 2004/27/EC of 31 March 2004 amending Directive 2001/83/EC on the Community code 
relating to medicinal products for human use. Viewed at:  
https://ec.europa.eu/health/sites/health/files/files/eudralex/vol -1/dir_2004_27/dir_2004_27_en.pdf . See also 
WTO document WT/TPR/S/357/Rev.1, 13 October 2017, paras. 3.330 -3.334.  
460 Europ ean Commission, Question and Answers on the interplay between the Clinical Trials Regulation 
and the General Data Protection Regulation . Viewed at: 
https://ec.europa.eu/health/sites/health/files/files/documents/qa_clinicaltrials_gdpr_en.pdf .  
461 Regulation (EU) No . 536/2014 of the European Parliam ent and of the Council of 16 April 2014 on 
clinical trials on medicinal products for human use, and repealing Directive 2001/20/EC. Viewed at: 
http://data.europa.eu/eli/reg/2014/536/oj . 
462 The timing  of its application depends on confirmation of the full functionality of the Clinical Trials 
Information System through an independent audit. The Regulation becomes applicable six months after the 
European Commission publishes notice of this confirmation. Consequently, the entry into application of this 
regulation is currently estimated to occur in 2020. EMA, Clinical Trial Regulation. Viewed at: 
https://www.ema.europa.eu/en/human -regulatory/research -development/clinical -trials/clinical -trial-regulation . 
463 See also Commission Delegated Regulation (EU) 2017/1569 of 23 May 2017 supplementing 
Regulation (EU) No. 536/2014 of the European P arliament and of the Council by specifying principles of and 
guidelines for good manufacturing practice for investigational medicinal products for human use and 
arrangements for inspections. Viewed at: http://data.europa.eu/eli/reg_del/2017/1569/oj . 
464 Commission Guideline - Guidance on posting and publication of result -related information on clinical 
trials in relation to the implementation of Article 57(2) of Regulation (EC) No . 726/2004 and Ar ticle 41(2) of 
Regulation (EC) No . 1901/2006. Viewed at: https://ec.europa.eu/health/sites/health/files/files/eudralex/vol -
10/2012_302 -03/20 12_302 -03_en.pdf . WT/TPR/S/395 • European Union  
 
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  information is publicly available through the EU Clinical Trials Register (EU CTR). Since July 2014, 
sponsors are required to post results within one year after the end  of a clinical trial (or six months 
for a paediatric trial). This information is also shared with the World Health Organization 's 
International Clinical Trials Registry Platform , of which EU CTR is a primary registry. As at April 2019, 
the EudraCT database  included 57,687 clinical trials in total, of which 27,093 were completed. The 
relevant technical guidance and technical documents were updated and published on EudraLex -10. 
Dedicated support tools are available at the EudraCT website.  
3.368.   In line with its up dated policy on publication of clinical data for medicinal products for human 
use465, since 1 January 2015, the European Medicines Agency (EMA) publishes the clinical data 
submitted by pharmaceutical companies to support their requests for marketing authoriz ation; these 
are assessed by the Committee for Human Medicinal Products. Clinical data normally include:  
• the clinical overview, providing a critical analysis of the clinical data in the submission 
package, including the conclusions and implications of the clinical data;  
• the clinical summary, which provides a detailed factual summarization of all the clinical 
information submitted;  
• the study reports on the individual clinical studies; and  
• three appendices to the clinical study reports, namely the study proto col, the sample case 
report form used to record information on an individual patient, and documentation of the 
statistical methods used to analyse the data.466 
3.369.   Clinical reports must be anonymized in order to comply with European legislation on personal 
data protection, and companies must justify the redaction of any commercially confidential 
information (CCI). The EMA provides guidance for pharmaceutical companie s on the requirement to 
comply with its policy on the publication of clinical data.467 
3.370.   On 16 July 2018 , the EMA published the first report on the implementation of the policy on 
the publication of clinical data.468 According to the report, a s at 20 October 201 7, clinical data 
corresponding to 54 regulatory procedures for 50 medicines, and amount ing to over 3,000 clinical 
documents, totalling more than 1.3 million pages , had been published . Published data attracted a 
total of more than 3,600 users, resulting in over 22,000 document views and in excess of 
80,000  document downloads for non -commercial research purposes.  Furthermore, t he amount of 
CCI redactions in the documents published was very low, in only 0.01% of total pages published.  
3.3.7.3   Enforcement  
3.3.7.3.1   Economic impact  
3.371.   The European Observatory on Infringements of IPRs (Observatory) has among its principal 
tasks to collect and monitor information regarding counterfeiting and piracy in the EU's internal 
market, as well as to foster collaboration through a n etwork of public and private sector actors .469 
In order to provide evidence and data required for EU  policymakers to take informed decisions, the 
Observatory hosts a number of important information resources regarding IPR enforcement. In 
                                                
465 EMA, European Medicines Agency policy on publication of clinical data for medicinal products for 
human use. Policy/0070, dated 21 March 2019 (EMA/144064/2019). It supersedes an earlier version of the 
policy dated 2 October 2014 (EMA/240 810/2013). Viewed at: 
https://www.ema.europa.eu/documents/other/european -medicines -agency -policy -public ation-clinical -data-
medicinal -products -human -use_en.pdf . 
466 EMA, Clinical data publication. Viewed at: https://www.ema.europa.eu/en/human -
regulat ory/marketing -authorisation/clinical -data-publication . 
467 EMA, Support for industry on clinical data publication. Viewed at: 
https://www.ema.europa.eu/en/human -regulatory/marketing -authorisation/clinical -data-publication/support -
industry -clinical -data-publication . 
468 EMA, Clinical data publication (Policy 0070) report Oct 2016 -Oct 2017. Viewed at: 
https: //www.ema.europa.eu/documents/report/clinical -data-publication -policy -0070-report -oct-2016-oct-
2017_en.pdf . 
469 WTO document WT/TPR/S/357/ Rev.1, 13 October 2017, para. 3.343.  WT/TPR/S/395 • European Union  
 
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  particular, it admin isters the Enforcement Database470 as the single platform to deal with 
IPR enforcement matters . The Observatory is managed by the E UIPO.  
3.372.   In the reporting period, the EUIPO carried out a number of studies highlighting the risks 
deriving from, and the economi c impact of, counterfeiting and piracy in the EU. Notably, its 2019 
Qualitative Study on Risks Posed by Counterfeits to Consumers471 sets out that 97% of recorded 
dangerous counterfeit goods were assessed as posing a serious risk, with toys at the top of the  list, 
followed by clothing, textiles and fashion items. In fact, the end users of 80% of the goods reported 
to be dangerous and counterfeit were children (toys, childcare items and children's clothing). The 
causes of the risks identified ranged from poorl y-constructed products, to the use of inferior -quality 
supplies and components, to the lack of understanding of regulations or safety mechanisms.  
3.373.   According to the EUIPO 2019 Intellectual Property Crime Threat Assessment472, over the last 
four years, the tota l number of seizures of counterfeit items by customs authorities in the EU has 
gradually decreased. At the same time, the number of articles seized and the total estimated value 
of these seizures increased in 2015 and 2016, only decreasing in 2017. The num ber of articles per 
seizure and the average value per seizure increased  considerably  (Table 3.32) .  
Table 3.32 Trends in seizures based on customs figures , 2014 -17 
 2014  2015  2016  2017  
Number of seizures  95,194  81,098  63,184  57,433  
Number of articles  35,568,982  40,728,675  41,387,132  31,410,703  
Estimated value ( EUR)  617,046,337  642,108,323  672,899,102  582,456,067  
Articles per seizure  374  502  655  547  
Value per seizure  (EUR)  6,482  7,918  10,650  10,141  
Source:  EUIPO, Intellectual Property Crime Threat Assessment . Viewed at: https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/doc ument_library/observatory/documents/reports/2019_IP_Crime_Threa
t_Assessment_Report/2019_IP_Crime_Threat_Assessment_Report.pdf . 
3.374.   Updating a 2016 OECD/EUIPO Report on Trade in Counterfeit and Pirated Goods: Mapping 
the Economic Impact, a 2019 OECD/EUIPO study  on Trends in Trade in Counterfeit and Pirated 
Goods473 reveals the top 25 provenance economies of counterfeit goods entering the EU in 2014 -16, 
with Hong Kong, China; China; and the United Arab Emirates at the top of the ranking.  
3.375.   Enforcement of IPRs in the  digital environment was a topic of particular interest in the 
reporting period, and was addressed in several EUIPO publications. For example, an EUIPO 2018 
study on the link between malware and copyright -infringing websites  points to the fact that, in the  
sample, nearly 8% of the identified websites were characterized as malicious by anti -virus 
vendors.474 Building on a previous qualitative study, quantitative research in the framework of a 
study on Online Business Models Infringing Intellectual Property Rig hts detected 27,870 e -shops 
suspected of marketing trade mark -infringing goods in Sweden, Germany, the United Kingdom and 
Spain. It was found that 21,001 of these e -shops (75.35%) were detected using domain names that 
had previously been used to direct Int ernet traffic to websites that have no relation to their prior 
                                                
470 The database can be accessed at: https://euipo.europa.eu/ohimportal/da/web/observatory/ip -
enforcement -portal -home -page. 
471 EUIPO, Qualitative Study on Risks Posed by Counterfeits to Consumers . Viewed at: 
https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/docume nt_library/observatory/documents/reports/2019_Risks_Posed_by_Counterfe
its_to_Consumers_Study/2019_Risks_Posed_by_Counterfeits_to_Consumers_Study.pdf . 
472 EUIPO, Intellectual Property Crime Threat Assessment 2019 . Viewed at: 
https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/observatory/docume nts/reports/2019_IP_Crime_Threat_Assessm
ent_Report/2019_IP_Crime_Threat_Assessment_Report.pdf . 
473 OECD/EUIPO, Trends in Trade in Counterfeit and Pirated Goods . Viewed at: 
https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/observatory/documents/reports/trends_in_trade_i n_counterfeit_a
nd_pirated_goods/trends_in_trade_in_counterfeit_and_pirated_goods_en.pdf . 
474 EUIPO, Identification and Analysis of Malware on Selected Suspected Copyright -infringing Websites . 
Viewed at: https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/observatory/documents/reports/2018_Malware_Study/2018_Mal
ware_Study_en.pdf . WT/TPR/S/395 • European Union  
 
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  use.475 Furthermore, a study on legislative measures which can be applied to prevent or combat 
IPR infringement in the online environment476 that legislative measures that concern the disclosure 
of information on a suspected infringer , and the possibility to block access to websites, are available 
in all member States . However, the study also notes (i) the lack of harmonization in regard to 
top-level domain name management at the EU level; and (ii) that specific legislative measures for 
suspension, transfer or deletion of domain name registrations that are suspected of infringing the 
IPR of a third party are available in most member States ; but (iii) none of them are available in all 
member States.   
3.376.   To make case law more accessible, the EUIPO publishes compilations of the recent cases 
related to IP law enforcement.477 It furthermore provided an overview of s peciali zed IPR jurisdictions , 
including international experience and providing an overview of rel evant institutions  in the member 
States .478 
3.3.7.3.2   Enforcement within the EU  
3.377.   During the review period, e nforcement of IPRs, both in traditional commerce and online, 
continued to be framed by Directive 2004/48/EC on the Enforcement of IPRs479 (IPRED) and Directive 
2001/29/EC on the Harmonisation of Certain Aspects of Copyright and Related Rights in the 
Information Society.480 
3.378.   Consultations on the civil enforcement of IPRs in the EU, including the operation and possible 
review of the IPRED , started in  2011, feeding into the  evaluation of the IPRED .481 They were 
concluded  in November 2017 , when  the Commission  decided that the IPRED is still fit for purpose, 
and adopted  a Guidance Communication482 clarifying the provisions of the IPRED ; there have been 
differing interpretations in EU countries  (e.g. related to its scope, rules on obtaining and preserving 
evidence, injunctions, and calculation of damages ). The guidance is based on a ruling by the CJEU 
and best practice developed in EU  countries.483 The Comm unication was part of an overall  
                                                
475 EUIPO, Research on Online Business Models Infringing Intellectual Property Rights - Phase 2 . Viewed 
at: https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/observat ory/documents/reports/Research_on_Online_Business_M
odels_Infringing_IP_Rights.pdf . 
476 EUIPO, Study on Legislative Measures Related to Online IPR Infringements . Viewed at: 
https://euipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/obs ervatory/documents/reports/2018_Study_on_legislative_mea
sures_related_to_online_IPR_infringements/2018_Study_on_legislative_measures_related_to_online_IPR_infri
ngements_EN.pdf . 
477 EUIPO, Recent European Case -law on the Infringement and Enforcement of Intell ectual Property 
Rights. The compilation of 2018 -19 cases can be viewed at: https://euipo.europa.eu/tunnel -
web/secure/w ebdav/guest/document_library/observatory/documents/reports/New_Case_Law_en.pdf . The 
judgements analysed include both those of the CJEU and those from the courts of the member States.  
478 EUIPO, Specialised IP Rights Jurisdictions in the Member States . Viewed  at: 
https://eu ipo.europa.eu/tunnel -
web/secure/webdav/guest/document_library/observatory/documents/reports/2018_Specialised_IP_Rights_Juri
sdictions_in_Member_States/2018_Specialised_IP_Rights_Jurisdictions_in_Member_States_EN.pdf . 
479 Directive 2004/48/EC of the European P arliament and of the Council of 29 April 2004 on the 
enforcement of intellectual property rights. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TX T/PDF/?uri=CELEX:32004L0048R(01)&from=EN . 
480 Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the 
harmonization of certain aspects of copyright and related rights in the information society. Viewed at:  
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32001L0029&from=EN . An overview of the 
main enforcement provisions was provided by the previous Reviews. See WTO doc uments 
WT/TPR/S/317/Rev.1, para. 3.307, Table 3.23; and WT/TPR/S/357/Rev.1, 13 October 2017, paras. 3.339 et 
seq. 
481 European Commission, e valuation report. Viewed at: 
https://ec.europa.eu/docsroom/documents/26601 ; and Publications Office of the European Union, Support 
study for the ex -post evaluation and ex -ante impact analysis of the IPR enforcement Directive (IPRED) . Viewed 
at: https://publications.europa.eu/en/publication -detail/ -/publication/1e3b2f41 -d4ba-11e7-a5b9-
01aa75ed71a1/language -en. 
482 European Commission, Communication from the Commission to the Institutions on Guidance on 
certain aspects of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of 
intellectual property rights . Viewed at: 
https://ec.europa.eu/docsroom/documents/26582/attachments/1/translations/en/renditions/native . 
483 European Commission, Enforcement of intel lectual property rights. Viewed at: 
https://ec.europa.eu/growth/industry/intellectual -property/enforcement_en . WT/TPR/S/395 • European Union  
 
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  comprehensive package of measures to further improve the application and enforcement of IPR, and 
to step up the fight against counterfeiting and piracy  (the "enforcement package") .484  
3.3.7.3.3   Enforcement at the EU's external borders  
3.379.   Since 1 January 2014, IPR enforcement at the EU borders is governed by Regulation (EU) 
No. 608/2013485, and Commission Implementing Regulation (EU) No. 1352/2013.486 
3.380.   The enforcement of IPR s by customs continues to be  a priority for the Commission and for 
member States . At the external border of the EU, customs authorities may suspend the release of, 
or detain, goods that are suspected of infringing , or are found to have infringed , IPRs. In most cases, 
customs authorities act upon applications from right -holders. However, they may also act ex officio  
if they have sufficient grounds for suspecting that goods infringe an IPR. In such cases, they will 
notify the detention/suspension to the importer within one working day, and to the right -holder on 
the same d ay or promptly thereafter. The right -holder must submit an application for action within 
four working days of receiving the notification. If no application is submitted within this period, the 
goods are released.  
3.381.   The European Commission's annual reports pr ovide statistical information and data about 
customs interventions which support the analysis of IPR infringements occurring in the EU. According 
to the latest report487, roughly 60 ,000 cases of IPR -infringing goods were detained by customs in 
2016-17, repre senting a total of more than 40 million article s in 2016 and more than 30  million in 
2017, with a domestic retail value of the genuine  products of over EUR 670 million  in 2016 and 
EUR 580 million in 2017  (Table 3.33 ).  
Table 3.33 Detention totals  at EU borders, reported for 2016 and 2017  
Detention totals  2016  2017  
Cases  63,184  57,433  
Procedures  77,705  74,706  
Articles  41,387,132  30,410,703  
Domestic retail value  EUR 672,899,102  EUR 582,456,067  
Source:  European Commission (2018), Report on the EU customs enforcement of intellectual property rights: 
Results at the EU border, 2017.  
3.382.   The total number of cases (each case representing an interception by customs) decreased 
by 9% in 2017, for the most part in t he postal, air freight and sea transportation modes. 
Interceptions in express courier and road transport demonstrated an increase, when compared to 
the figures from 2016. In terms of provenance, China is the main source country (73%) from where 
suspected I PR-infringing goods arrived when they were detained, and where those goods were 
subsequently not released.  In relation to value, the order and list of countries changed in comparison 
                                                
484 European Commission, Intellectual Property. Viewed at : 
https://ec.europa.eu/growth/industry/intellectual -property_en#enforcement_package . The package included, 
apart from the above -referenced Guidance, Repo rt and Study, a communication entitled  A balanced IP 
enforcement system responding to today's societal challenges . Viewed at: 
https://ec.europa.eu/docsroom/documents/26581 ; a communication  entitled Setting out the EU approach to 
Standard Essential Patents . Viewed at: https://ec.europa.eu/docsroom/documents/26583 ; and an Overview of 
the functioning of the Memorandum of Understanding on the sale of counterfeit goods via the Internet . Viewed 
at: https://ec.europa.eu/docsroom/documents/26602 . 
485 Regulation (EU) No. 608/2013 of the European Parliament and of the Co uncil of 12 June 2013 
concerning customs enforcement of intellectual property rights and repealing Council Regulation (EC) 
No. 1383/2003. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2013:181:0015:0034:en:PDF . For a more detailed 
description of this Regulation, see WTO document WT/TPR/S/317/Rev.1, 13 October 2017, paras. 3.304 -3.305. 
For an overview of the main provisions relating to border measures, see also Table 3.23 of that document.  
486 Commission Implementing Regulation (EU) No. 1352/2013 of 4 December 2013 establishing the 
forms provided for in Regulation (EU) No. 608/2013 of the European Parliament and of the Council concernin g 
customs enforcement of intellectual property rights. Viewed at:  https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32013R1352&from=EN . 
487 European Commission, Report on the EU customs enforcement of intellectual property rights: Results 
at the EU border, 2017 . Viewed at: https://publications.europa.eu/en/publication -detail/ -
/publication/64dda5ad -c197-11e8-9893-01aa75ed71a1/language -en/format -PDF/source -
77412360?WT.mc_id=NEWSLETTER_October2018 . WT/TPR/S/395 • European Union  
 
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  to former years. Hong Kong, China is at the top of the list for countries  of provenance in relation to 
value, due to detentions of high -value luxury goods.  
3.383.   According to the report for 2017, t op categories for detained articles in 2017 were: foodstuffs 
(24% of the overall amount of detained articles ), toys (11%), cigarettes (9% ), "other goods " (9%), 
and clothing (7%).  As in previous years, the majority of the articles (i.e. 92% in number s, and 94% 
in value) detained by customs in 2017 were suspected of infringing a n EUTM , international trade 
mark or national trademark . In 79% of  the detention procedures started by customs, the goods 
were destroyed after the owner of the goods and the right -holder agreed on destruction. In 10% of 
the detentions, a court case was initiated to determine the infringement and, in 0.2%, the goods 
were dealt with as part of criminal proceedings.  
3.384.   In the Council for TRIPS , the enforcement of IPRs  pursuant to the EU's legislation  was 
considered at its meeting on  8-9 November 2018.488 In that meeting, t he EU took  note of the 
questions from the Indian delegation on the enforcement of IP Rs regarding goods in transit.489 The 
EU also submitted updated responses to the Checklist of issues on enforcement in July 2019.490 
3.3.7.3.4   Enforcement at the international level  
3.385.   The EU's curre nt strategy to enforce IPR in non -EU countries is in place since 2014.491 In the 
review  period, the Commission published its updated Counterfeit and Piracy Watch List .492 The Watch 
List reflects the results of stakeholder consultations , and presents a non -exhaustive list of examples 
of reported third -country online marketplaces or service providers which allegedly engage in, 
facilitate or benefit from counterfeiting and piracy. The aim is to encourage the operators and 
owners , as well as the responsible local e nforcement authorities and governments , to take the 
necessary actions and measures to reduce and/or prevent any IPR infringements , and to raise 
consumer awareness. Furthermore, a general analysis of the protection and enforcement of IPR in 
third countries can be found in the Commission services'  report on the protection and enforcement 
of IPRs in third countries.493  
3.386.   The EU also aims to include, in its RTAs with third countries, comprehensive IPR chapters 
offering similar levels of IPR protection to that exis ting in the EU, taking into account the level of 
development of the countries concerned.  It engages in several active discussions on IP with other 
countries.494 The Commission finances and steers several technical cooperation programmes , aimed 
at strengtheni ng IPR protection and enforcement in third countries. In general, the EUIPO is 
entrusted with the technical implementation of those cooperation programmes.495 
                                                
488 See minutes of the  meeting, in WTO document IP/C/M/90/Add.1, 15 January 2019, paras. 22 -25. 
489 Circulated in WTO documents IP/C/W/636, 9 October 2017; and IP/C/W/636/Add.1, 
25 October  2018. According to the latest report, around 70% of medicines and other medical products se ized 
and not released by EU customs originated in India.  
490 Council for Trade -Related Aspects of Intellectual Property Rights - Checklist of issues on enforcement 
- Responses from European Union , WTO document IP/N/6/EU/1, 10 July 2019.  
491 WTO document WT/TPR /S/357/Rev.1, 13 October 2017, para. 3.354 et seq.  
492 European Commission, Counterfeit and Piracy Watch List . Viewed at: 
https://trade.ec.europa.eu/doclib/docs/2018/decem ber/tradoc_157564.pdf . The Watch List helps identify the 
marketplaces outside the EU where counterfeiting, piracy or other forms of IP abuse are common practice.  
493 European Commission, Report on the protection and enforcement of intellectual property rights in 
third countries . Viewed at: https://ec.europa.eu/transparency/regdoc/rep/10102/2018/EN/SWD -2018-47-F1-
EN-MAIN -PART-1.PDF . The re port gives EU right -holders information on the effectiveness of IPR regimes in 
countries outside the EU.  
494 For an overview, European Commission, EU dialogues with priority countries on intellectual property 
issues . Viewed at: https://trade.ec.europa.eu/doclib/docs/2013/april/tradoc_151009.pdf . 
495 Under Regulation (EU) No. 386/2012, OJ EU L 129/1, 16 May 2012, the EUIPO was tasked with 
building strategies and developing tools to enforce IPRs through international cooperation with IP offices in 
third countries, as well as to build capacity in third countries. For up -to-date information, see 
https://euipo.europa.eu/ohimportal/en/web/observatory/protecting -ip-in-third-countries . WT/TPR/S/395 • European Union  
 
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  4  TRADE POLICIES BY SE CTOR  
4.1  Agriculture  and Fisheries  
4.1.1   Agriculture  
4.1.  The total product ion value of agricultural products in the EU reached EUR  393.5 billion in 2018, 
from EUR  389 billion in 2017 and EUR  366.3 billion in 2016, representing a growth of 1.0% and 
7.5%, respectively. Crops remained stable, at a level of 56.5% of production value  in 2017, with 
cereals and fresh vegetables remaining the most valuable crops. Animals and animal products 
represented 43.5% of production value, with milk alone representing 14.7% of total agricultural 
output, followed by pigs and cattle, with just over 9 % and 8%, respectively (Table 4.1). Over half 
of the total agricultural output value came from four producers, namely France (17%), Italy (13%), 
Spain and Germany (12% each).1 
Table 4.1 Total production value of agricultural products, 2014 -18 
(EUR million at producer prices)  
  2014  2015  2016  2017  2018  
All products  383,156  376,378  366,318  389,279  393,499  
Crops  211,918  213,808  209,344  216,338  222,076  
Cereals  52,162  49,957  42,822  45,650  47,983  
Wheat and spelt  26,096  26,519  20,755  22,776  23,251  
Grain maize  11,749  9,192  9,582  9,822  10,813  
Oil seeds  11,655  11,653  11,301  12,310  11,063  
Forage plants  25,013  22,498  23,630  22,917  21,843  
Fresh vegetables  30,024  33,394  32,682  34,442  35,166  
Plants and flowers  20,706  20,916  21,254  22,260  21,857  
Fruits  23,583  26,052  25,897  26,873  28,986  
Wine 21,666  22,834  22,502  22,046  27,918  
Potatoes  9,878  10,349  12,623  11,305  12,124  
Animals and animal products  171,237  162,569  156,974  172,941  171,423  
Cattle  31,522  32,759  31,184  31,745  32,476  
Pigs 36,017  33,340  35,031  39,090  36,494  
Poultry  21,782  22,372  21,342  21,313  22,486  
Milk 60,722  52,384  48,993  58,850  57,712  
Eggs 9,012  9,509  8,629  10,139  10,409  
Source:  Eurostat, Economic accounts for agriculture - values at current prices  (aact_eaa01 ). Viewed at: 
https://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=aact_eaa01&lang=en . 
4.2.  In 2017, agriculture contributed 1.2 % to GDP. The EU's agricultural gross value added 
increased by 12.4% compared to 2016, largely due to the boost of the EU's agricultural industry 
output value, thus confirming the upward trend recorded since 2005.2 The importance of agriculture 
in the economy varies significantly from one member State to an other, from less than 1.0% of total 
GDP in Belgium, the Czech Republic, Germany, Luxembourg, Malta, Austria, the Slovak Republic, 
Finland, Sweden and the United Kingdom to 4.1% in Romania and 3.7% in Bulgaria.3 
4.3.  People working in agriculture accounted for 9 .7 million in 2016, representing 4.2% of total 
employment. The sector is particularly important in Romania, Bulgaria, Greece and Poland, 
accounting for 23 .0%, 17.5%, 10.7% and 10.1% of total employment , respectively .4  
4.4.  Most of EU agriculture holdings are s mall, with two thirds of the 10.5 million farms being less 
than 5  ha in size. At the other end of the spectrum, 6.9% of the farms were of 50 ha or more in size 
                                                
1 Eurostat, Output of the agricultural industry - basic and producer prices . Viewed at: 
https://ec.europa.eu/eurostat/tgm/table.do?tab=table&init=1&language=en&pcode=tag00102&plugin=1 . 
2 Eurostat, Agriculture, forestry and fishery statistics – 2018 edition . Viewed at: 
https://ec.europa.eu/eurostat/en/web/products -statistical -books/ -/KS-FK-18-001. 
3 Eurostat, Gross value added of the agricultural industry - basic and producer prices. Viewed at: 
https://ec.europa.eu/eurostat/databrowser/view/tag00056/default/table?lang=en . 
4 Eurostat. Agriculture, forestry and fishery statistics - 2018 edition . WT/TPR/S/395 • European Union  
 
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  and worked two thirds of the utilized area. The average size was 16.6 ha, with only 15% of farms  
being that size or bigger.5 Romania alone accounts for one third of the EU's agricultural holdings, 
with an average farm size of 3.7 ha. The standard output per holding varies from EUR 3,538 in 
Romania to EUR 414,638 in the Netherlands (Table 4.2).  
Table  4.2 Selected indicators of agricultural structure, 2016  
 Utilized 
agricultural 
area (UAA) 
('000 ha)  Number of 
holdings 
('000)  Average 
UAA per 
holding 
(ha) Standard 
output 
(EUR/holding)  Standard 
output 
(EUR/ha ) Crop and 
animal 
production 
hunting 
(% total 
employment)  Manufacture 
of food 
products, 
beverages 
and tobacco 
(% total 
employment)  
Belgium  1,354.3  36.9 36.7 217,891  5,935  1% 2% 
Bulgaria  4,468.5  202.7  22.0 18,957  860 17% 3% 
Czech Republic  3,455.4  26.5 130.2  191,555  1,471  3% 2% 
Denmark  2,614.6  35.1 74.6 287,088  3,849  2% 2% 
Germany  16,715.3  276.1  60.5 178,361  2,946  1% 2% 
Estonia  995.1  16.7 59.6 47,997  805 3% 2% 
Ireland  4,883.7  137.6  35.5 45,979  1,295  5% 3% 
Greece  4,553.8  685.0  6.6 11,059  1,663  11% 3% 
Spain  23,229.8  945.0  24.6 40,598  1,652  4% 2% 
France  27,814.2  456.5  60.9 134,371  2,205  3% 2% 
Croatia  1,563.0  134.5  11.6 15,134  1,302  6% 4% 
Italy 12,598.2  1,145.7  11.0 45,115  4,103  3% 2% 
Cyprus  111.9  34.9 3.2 17,650  5,510  4% 3% 
Latvia  1,930.9  69.9 27.6 17,465  633 5% 3% 
Lithuania  2,924.6  150.3  19.5 14,810  761 7% 3% 
Luxembourg  130.7  2.0 66.3 185,283  2,794  1% 1% 
Hungary  4,670.6  430.0  10.9 15,192  1,399  6% 3% 
Malta  11.1 9.2 1.2 10,642  8,814  1% 2% 
Netherlands  1,796.3  55.7 32.3 414,638  12,853  2% 1% 
Austria  2,669.8  132.5  20.1 46,351  2,300  3% 2% 
Poland  14,405.7  1,410.7  10.2 17,726  1,736  10% 3% 
Portugal  3,641.7  259.0  14.1 19,863  1,413  9% 2% 
Romania  12,502.5  3,422.0  3.7 3,538  968 23% 3% 
Slovenia  488.4  69.9 7.0 16,578  2,373  7% 2% 
Slovak Republic  1,889.8  25.7 73.6 75,270  1,022  2% 2% 
Finland  2,233.1  49.7 44.9 70,702  1,574  3% 1% 
Sweden  3,012.6  62.9 47.9 81,962  1,712  1% 1% 
United Kingdom  16,673.3  185.1  90.1 137,271  1,524  1% 1% 
EU-28 173,338.6  10,467.8  16.6 34,785  2,101  4% 2% 
Source:  Eurostat, Farm indicators by agricultural area, type of farm, standard output, legal form and NUTS 2 
regions  (ef_m_farmleg ); Economic accounts for agriculture - values at current prices  (aact_eaa01); 
and National accounts employment data by industr y (nama_10_a64_e ). Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=ef_m_farmleg&lang=en ; 
http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=aact_eaa01&lang=en ; and 
http://appsso.eurostat.ec.europa.eu/nui/show.d o?dataset=nama_10_a64_e&lang=en .  
4.1.1.1   Trade  
4.5.  In 2018, the EU had a EUR 20.9 billion surplus in trade of agricultural products 
(WTO  definition6), with exports of EUR 137.3 billion and imports of EUR  116.4 billion. In value terms, 
both exports and imports slightly decreased compared to 2017. Since 2015, exports increased by 
6.5% while imports increased by 2. 6%. Agricultural exports and imports as a percentage of total 
exports and imports both decreased , to 7.0% and 5.9% , respectively , in 2018. Wine , followed by 
distilled spirits , are the biggest exports, while coffee and soya bean cake are the main imports 
(Table  4.3). 
                                                
5 Eurostat. Agriculture, forestry and fishery statistics – 2018 edition . 
6 For the purposes of this Section of the TPR, the definition of agriculture products used is that set out in 
Annex 1 of the Agreement on Agriculture, i.e. HS Chapters 01 -24 less fish and fishery  products (HS Chapter 
03, 0508, 0511.91, 1504.10, 1504.20, 1603 -1605 and 2301.20) plus some selected products (HS 2905.43 -
2905.45, 3301, 3501 -3505, 3809.10, 3823, 3824.60, 4101 -4103, 4301, 5001 -5003, 510 1-5103, 5201 -5203, 
and 5301 -5302).  WT/TPR/S/395 • European Union  
 
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  Table 4.3 Exports and imports of agricultural products (HS 4 -digit level), 2015 -18a 
(EUR billion, unless otherwise indicated)  
HS4 Product description  2015  2016  2017  2018  Top 5 destinations /origins  in 2018  
(% of total agriculture exports/ 
imports)  
Total agriculture exports  128.9  131.0  137.4  137.3  United States (16.2), China (8.1), 
Switzerland (6), Japan (4.8), 
Russian Federation (4.8)  
(% of total exports)  7.2%  7.5%  7.3%  7.0%    
of which:      
  
2204 Wine of fresh grapes  9.8  10.1  11.3  11.6  United States (32.5), Switzerland (8.7), 
China (8.3), Canada (7.8), Japan (7.2)  
2208 Undenatured ethyl 
alcohol of an alcoholic 
strength by volume of 
less than 80% vol.; 
spirits, liqueurs and 
other spirituous 
beverages  10.3  10.2  10.7  11.3  United States (37.7), Singapore (8.7), 
China (5.2), Russian Federation (4.5), 
Canada (3)  
1901 Malt extract; food 
preparations of flour, 
groats, meal, starch or 
malt extract  5.6  5.9  6.6  6.8  China (34.6), Hong Kong, China (9.9), 
Saudi Arabia (6.2), Russian Federation 
(2.8), Nigeria (2.3)  
2106 Food preparations not 
elsewhere specified or 
included  5.1  5.5  5.9  5.9  United States (9.6), Russian Federation 
(5.9), Switzerland (5.5), China (5.3), 
Turkey (4.5)  
0203 Meat of swine, fresh, 
chilled or frozen  4.0  5.2  5.1  4.8  Japan (26.2), China (21.7), Korea, Rep. 
of (15.6), United States (7.2), Australia 
(4.2)  
2309 Preparations of a kind 
used in animal feed  3.4  3.6  4.2  4.1  Russian Federation (11.4), Norway (6.8), 
United States (5.5), Switzerland (5.2), 
Japan (5)  
0406 Cheese and curd  3.5  3.6  4.0  4.0  United States (21.8), Japan (10.2), 
Switzerland (8.7), Australia (4.4), 
Canada (4.1)  
1905 Bread, pastry, cakes, 
biscuits and other 
bakers' wares  3.4  3.5  3.8  4.0  United States (18.4), Switzerland (9.9), 
Norway (7.6), Russian Federation (6.3), 
Australia (5.8)  
1806 Chocolate and other food 
preparations containing 
cocoa  3.8  3.8  3.9  4.0  United States (13), Russian Federation 
(9.1), Australia (5.6), Switzerland (5.3), 
Canada (5.3)  
1001 Wheat and meslin  6.3  5.6  4.0  3.6  Algeria (28.9), Saudi Arabia (16.9), 
Egypt (6.2), Morocco (3.8), Jordan (3.7)  
Total agriculture imports  113.5  112.5  117.4  116.4  United States (10.4), Brazil (10.2), 
China (4.9), Ukraine (4.8), Argentina 
(4.4)  
(% of total imports)  6.6%  6.6%  6.3%  5.9%    
of which:      
  
0901 Coffee  8.9  8.5  8.8  7.8  Brazil (24.8), Switzerland (17.3), 
Viet Nam (16.1), Honduras (7.2), 
Colombia (6.3)  
2304 Oil-cake and other solid 
residues from soya bean 
oil 7.5  6.4  6.3  6.3  Brazil (41.8), Argentina (38.8), Paraguay 
(4.7), United States (4.6), India (2.7)  
1201 Soya beans  5.3  5.3  4.9  5.1  United States (49), Brazil (36.5), Canada 
(5.6), Ukraine (4.1), Paraguay (2.6)  
1511 Palm oil and its fractions  4.4  4.1  4.9  4.2  Indonesia (46.4), Malaysia (25.1), 
Papua  New Guinea (9), Colombia (6.3), 
Guatemala (5.7)  
0802 Other nuts, fresh or 
dried, whether or not 
shelled or peeled  5.0  4.3  4.0  4.0  United States (56), Turkey (16.8), Chile 
(6), Iran (4.9), China (4)  
0803 Bananas, including 
plantains, fresh or dried  3.4  3.5  3.9  3.9  Ecuador (25.3), Colombia (22.6), Costa 
Rica (19.6), Côte d'Ivoire (6), Panama 
(6)  
1801 Cocoa beans  4.2  4.9  4.0  3.9  Côte d'Ivoire (52.1), Ghana (18), Nigeria 
(10.6), Cameroon (6.8), Ecuador (3.6)  
1005 Maize (corn)  2.1  2.2  2.8  3.7  Ukraine (51.1), Brazil (20.5), 
United  States (8.5), Canada (7.7), 
Argentina (2.5)  WT/TPR/S/395 • European Union  
 
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  HS4 Product description  2015  2016  2017  2018  Top 5 destinations /origins  in 2018  
(% of total agriculture exports/ 
imports)  
0804 Dates, figs, pineapples, 
avocados, guavas, 
mangoes and 
mangosteens, fresh or 
dried 2.2  2.6  2.9  2.8  Costa Rica (21.5), Peru (19.5), Brazil 
(7.1), Israel (6.7), Turkey (5.2)  
2204 Wine of fresh grapes  2.8  2.6  2.6  2.7  Chile (22.1), Australia (16.8), United 
States (16), South Africa (15.1), 
New Zealand (14)  
a Major items, according to 2018 data.  
Note:  WTO definition of agriculture: HS Chapters 01 -24 less fish and fishery products (HS Chapter 03, 
0508, 0511.91, 1504.10, 1504.20, 1603 -1605 and 2301.20), plus some selected products 
(HS 2905.43 -2905.45, 3301, 3501 -3505, 3809.10, 3823, 3824.60, 4101 -4103, 4301, 5001 -5003, 
5101-5103, 5201 -5203, and 5301 -5302).  
Source:  WTO Secretariat calculations, based on Eurostat, International trade in goods . Viewed at: 
https://ec.europa.eu/eurostat/web/international -trade -in-goods/data/datab ase. 
4.1.1.2   Agricultural policies  
4.6.  Since the last Review, the Common Agricultural Policy (CAP) legislative framework has not 
changed dramatically. The 2013 CAP reforms have been fully applied since 2015, based on the 2013 
regulations and the secondary regulations adopted in March 2014. The structure of the agricultural 
policies remains the same: the European Agriculture Guarantee Fund (EAGF) covers direct payments 
and market measures (Pillar  I), and the European Agricultural Fund for Rural Development (EAFRD) 
finances the EU contribution to rural development programmes (Pillar II).  
4.7.  The main modification occurred at the end of 2017. Following a number of simplification 
measures, adopted through changes to Commission delegated and implementing acts and 
guidelines, th e regulation on the financial rules applicable to the general budget of the EU, the 
Omnibus regulation, published in September 2016 as part of the review package of the Multiannual 
Financial Framework (MFF), contained changes applicable to the basic CAP re gulations.7 The 
Omnibus Agricultural Provisions Regulation (EU) 2017/23938 was adopted on 13 December  2017. It 
contains technical amendments relating to the four Basic Acts of the CAP: (i) direct payments9; 
(ii) rural development10; (iii) common market orga nization11; and (iv)  horizontal regulation 
(financing, management and monitoring of the CAP).12 
                                                
7 European Council , Omnibus regulation – Agricultural rules. Viewed at: 
https://www.consilium.europa.eu/en/policies/cap -simplification/omnibus -regulation -agricultu re/. 
8 Regulation (EU) No. 2017/2393 of the European Parliament and of the Council of 13 December 2017 
amending Regulations (EU) No. 1305/2013 on support for rural development by the European Agricultural Fund 
for Rural Development (EAFRD), (EU) No. 1306/2 013 on the financing, management and monitoring of the 
common agricultural policy, (EU) No. 1307/2013 establishing rules for direct payments to farmers under 
support schemes within the framework of the common agricultural policy, (EU) No. 1308/2013 establi shing a 
common organisation of the markets in agricultural products and (EU) No. 652/2014 laying down provisions for 
the management of expenditure relating to the food chain, animal health and animal welfare, and relating to 
plant health and plant reproduc tive material. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32017R2393 . 
9 Regulation (EU) No. 1307/2013 of 17 December 2013 establishing rules for direct payments to 
farmers under support schemes within the framework of the common agricultural policy and repealing Council 
Regulation (EC) No. 637/2008 and Council Regulation (EC) No. 73/2009. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2013:347:0608:0670:EN:PDF . 
10 Regulation (EU) No. 1305/2013 of 17 December 2013 on support for rural development by the 
European Agricultura l Fund for Rural Development (EAFRD) and repealing Council Regulation (EC) 
No. 1698/2005. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?ur i=OJ:L:2013:347:0487:0548:en:PDF . 
11 Regulation (EU) No. 1308/2013 of 17 December 2013 establishing a common organisation of the 
markets in agricultural products and repealing Council Regulations (EEC) No. 922/72, (EEC) No. 234/79, (EC) 
No. 1037/2001 and (EC) No. 1234/2007. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2013:347:0671:0854:EN:PDF . 
12 Regulation (EU) No. 1306/2013 of 17  December 2013 on the financing, management and monitoring 
of the common agricultural policy and repealing Council Regulations (EEC) No.  352/78, (EC) No. 165/94, (EC) 
No. 2799/98, (EC) No.  814/2000, (EC) No.  1290/2005 an d (EC) No.  485/2008. Viewed at: https://eur -
lex.europa.eu/legal -content/en/ALL/?uri=CELEX%3A32013R1306 . WT/TPR/S/395 • European Union  
 
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  4.1.1.2.1   Domestic support  
4.1.1.2.1.1   Direct payments  
4.8.  Regulation (EU) No.  1307/2013 and secondary regulations13 remain the current legal 
framework for direct  payments. The national cei lings per member State for each year are set out in 
Regulation (EU) No. 1307/2013. The national ceilings provide for convergence among the member 
States, and the rules governing direct payments require internal convergence within each member 
State14 so that  payments per hectare move towards a more uniform level within and among member 
States.  
4.9.  Each member State has some flexibility to transfer some funding from direct payments to rural 
development, or vice versa. Twelve member States15 chose to transfer funds from direct payments 
to rural development, with a total transfer of EUR  7.1 billion over the 2015 -20 period, and 
five member States16 transferred a total of EUR  3.4 billion from rural development to direct 
payments. The net amount of national ceilings for d irect payments for each member State is shown 
in Table 4.4.  
Table 4.4 Net amounts – national ceilings for direct payments, 2015 -20 
 
2015  2016  2017  2018  2019  2020  
Belgium  524 510 502 489 482 505 
Bulgaria  721 789 790 791 793 799 
Czech Republic  840 839 839 857 857 873 
Denmark  870 852 834 826 818 880 
Germany  4,913  4,881  4,848  4,820  4,793  5,018  
Estonia  114 115 124 134 144 169 
Ireland  1,215  1,213  1,212  1,211  1,211  1,211  
Greece  2,110  2,087  2,064  2,043  2,022  2,119  
Spain  4,902  4,911  4,926  4,940  4,953  4,954  
France  7,302  7,271  7,239  6,901  6,877  7,437  
Croatia  184 203 241 279 317 306 
Italy 3,897  3,847  3,797  3,750  3,702  3,704  
Cyprus  51 50 50 49 49 49 
Latvia  181 206 230 255 280 303 
Lithuania  418 443 467 475 483 517 
Luxembourg  34 34 34 34 33 33 
Hungary  1,277  1,276  1,274  1,274  1,274  1,269  
Malta  5 5 5 5 5 5 
Netherlands  749 737 724 683 671 732 
Austria  693 692 692 692 692 692 
Poland  3,359  3,376  3,392  3,411  3,430  3,062  
Portugal  566 574 582 591 599 600 
Romania  1,600  1,773  1,801  1,873  1,903  1,903  
                                                
13 Commission Delegated Regulation (EU) No. 639/2014 of 11 March 2 014 supplementing Regulation 
(EU) No. 1307/2013 of the European Parliament and of the Council establishing rules for direct payments to 
farmers under support schemes within the framework of the common agricultural policy and amending Annex X 
to that Regula tion. Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32014R0639 ; 
and Commission Implementing Regulation (EU) No. 641/2014 of 16 June 2014 laying down rules for the 
application of Regulation (EU) No. 1307/2013 of the European Parliament and of the Council establishing rules 
for direct payments to farmers under support schemes within the framework of the common agricultural policy. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX:32014R0641 . 
14 In the case of the Single Area Payment Scheme, a uniform payment rate already applies. 
Eight member States  applying the Basic Payment Scheme have opted for a form of flat rate, at national or 
regional level: Germany, France -Corsica, Malta, the United Kingdom -England from 2015, the Netherlands, 
Austria, Finland, the United Kingdom -Scotland and Wales by 2019, an d Sweden in 2020.  
15 France, Latvia, Lithuania, the United Kingdom, Belgium, the Czech Republic, Denmark, Germany, 
Estonia, Greece, the Netherlands, and Romania. Changes requested by France, Lithuania and the Netherlands 
were adopted through Commission Del egated Regulation (EU) 2018/162, 23 November 2017.  
16 Croatia, Malta, Poland, the Slovak Republic, and Hungary.  WT/TPR/S/395 • European Union  
 
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2015  2016  2017  2018  2019  2020  
Slovenia  138 137 136 135 134 134 
Slovak Republic  436 439 442 445 449 394 
Finland  523 523 524 524 525 525 
Sweden  697 697 698 699 700 700 
United Kingdom  3,171  3,177  3,184  3,192  3,201  3,592  
Source:  Regulation (EU) No. 1307/2013 of the European Parliament and of the Council  of 17 December 2013 
establishing rules for direct payments to farmers under support schemes within the framework of 
the common agricultural policy and re pealing Council Regulation (EC) No. 637/2008 and Council 
Regulation (EC) No. 73/2009, as amended in particular by Commission Delegated Regulations (EU) 
No. 1378/2014, 17 October 2014 and 2018/162, 23 November 2017. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:02013R1307 -20190301&from=EN . 
4.10.   Apart from the small farmers' scheme (see below), all direct payment programmes are subje ct 
to provisions to ensure compliance with basic standards relating to the environment, food safety, 
animal and plant health, and animal welfare (cross -compliance).17 
4.11.   In order to be eligible for direct payments, farmers must comply with the "minimum 
require ments"18, i.e. be active farmers19 and have agricultural land at their disposal that is used for 
agricultural activity .20 
4.12.   Until 2017 , in all member States, entities operating an activity on the "negative list" were not 
considered "active farmers" unless they could prove that their farming activity was not marginal, 
using one of three  possibilities to rebut the negative presumption. Since  2018, the Omnibus 
Regulation provides greater flexibility to member States to define who is an active farmer , notably 
by allowing them to discontinue the application of the "negative list" or to reduce the number of 
possibilities for rebutting the negative presum ption and/or by introducing the possibility to consider 
as active farmers only those registered for their agricultural activities in a national fiscal or social 
security register .21 Member States can exempt farmers from the definition of active farmer if th ey 
received direct payments below a certain level of threshold not exceeding EUR 5,000.  
4.13.   Direct payments amounted to EUR 41.6 billion in 2017, including EUR 36.5 billion for 
decoupled direct aid, and benefitted 6.5 million farms. Roughly 76% of beneficiarie s receive less 
than EUR  5,000, and 80% of all beneficiaries receive 20% of total direct payments.22  
                                                
17 Regulation (EU) No. 1306/2013 on the financing, management and monitoring of the common 
agricultural policy, Regulation (EU) No. 640/2014 with regard to the integrated administration and control 
system and conditions for refusal or withdrawal of payments and administrative penalties applicable to direct 
payments, rural development support and cross -compliance, and Regulation (EU) No. 809/2014 lay ing down 
rules for the application of Regulation (EU) No. 1306/2013. Viewed at: https://eur -lex.europa.eu/legal -
content/en/ALL/?uri=CELEX%3A32013R1306 , https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32014R0640 , and https://eur -lex.europa.eu /legal -
content/en/ALL/?uri=CELEX:32014R0809 .  
18 Art. 10 of Regulation (EU) No. 1307/2013.  
19 Art. 9 of Regulation (EU) No. 1307/2013.  
20 European Commission, Eligibility for Direct payments of the Common Agricultural Policy.  Viewed at 
https://ec.europa.eu/info/sites/info/files/food -farming -fisheries/key_policies/documents/direct -payments -
eligibility -conditions_ en.pdf . 
21 Art. 9.2 of Regulation (EU) No. 1307/2013. As a result, only nine member States/regions decided to 
continue applying it: Belgium, Bulgaria, Croatia, Ireland, Malta, Romania, Slovenia, Spain and the 
United  Kingdom (Wales). Estonia and Finland are discontinuing it from 2019, and the other member States 
discontinued it in 2018.  
22 European Commission, Direct payments to agricultural producers – graphs and figures – Financial 
year 2017. Viewed at: https://ec.europa.eu/agriculture/sites/agriculture/files/cap -funding/beneficiaries/direct -
aid/pdf/direct -aid-report -2017_en.pdf . WT/TPR/S/395 • European Union  
 
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  Small farmers scheme   
4.14.   Member States have the option of applying a small farmers' scheme, a simplified scheme that 
replaces all other direct payments23 and wa ives eligible farmers from greening and cross -compliance 
penalties. Fifteen member States have opted for the small farmers' scheme.  
Basic payments and single area payments   
4.15.   Eighteen member States apply the Basic Payment Scheme24, while all others apply the Single 
Area Payment Scheme. Each of the ten member States25 using the Single Area Payment Scheme 
provides a uniform payment per eligible hectare. Eligibility for either Scheme is a precondition for 
the complementary payments under the decoupled income schem es (the greening payment, the 
young farmers' scheme, payments for areas with natural constraints, the small farmers' scheme, 
and redistributive payments).  
4.16.   Amongst the 18 member States that implement the Basic Payment Scheme, 6 opted for the 
possibility to regionalize the scheme.26  
4.17.   All ten member States using the Single Area Payment Scheme decided to grant, in 2017 and 
in 2018 , transitional national aid (TNA)27, which allows the provision of complementary support to 
sectors eligible for Complementary National Direct Payments in the past. However, due to budgetary 
constraints , Latvia did not grant any TNA in 2017 or 2018. The maximum amount of TNA will be 
gradual ly reduced, to reach, in application year 2020, 50% of the amounts payable in 2013.28 
4.18.   Allocations from the national ceilings to the Basic Payment Scheme or the Single Area 
Payments Scheme vary from 12.4% in Malta, to 68.0% in Luxembourg ( Table 4. 5). 
Greenin g payment   
4.19.   Each member State is required29 to allocate 30% of the annual national ceiling for direct 
payments to agricultural practices beneficial for the climate and the environment (greening).30 
Farmers that are entitled to payment under the Basic Payment Scheme or the Single Area Payment 
Scheme must observe , on all their eligible hectares , the following greening practices: (i) crop 
diversification applying for holdings over 10 ha; (ii) maintenance of existing permanent grassland; 
and (iii) having an ecolog ical focus area (EFA),  applying to at least 5% of the area of holdings over 
15 ha.  
4.20.   Exemptions to these criteria may apply, such as for farmers participating in the small farmers' 
scheme, farmers with a large proportion of permanent grassland, and farmers t hat meet the 
requirements for organic production.  
                                                
23 The level of payments under the sche me is limited to a minimum of EUR  500 and a maximum of 
EUR 1,250 and, depending on the method the member State opted for to determine this level, the payment 
may be limited to a maximum of 10% of the national direct payments. Viewed at: 
https://ec.europa.eu/agriculture/sites/agriculture/files/direct -support/direct -payments/docs/small -farmers -
scheme_en.pdf . 
24 Austria, Belgium, Croatia, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, 
Malta, the Netherlands, Portugal, Slovenia, Spain, Sweden, and the United Kingdom.  
25 Bulgaria, the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Poland, Romania and the 
Slovak Republic.  
26 Germany, by Länder;  Greece (3 regions according to historical land use); Spain (50 regi ons); France 
(Corsica and rest of France); Finland (2 regions); and the United Kingdom (regional model applied in Scotland 
and England).  
27 European Commission,  Direct Payments – Single Area Payment Scheme and Transitional National Aid.  
Viewed at: https://ec.europa.eu/agriculture/sites/agriculture/files/direct -support/direct -payments/docs/single -
paymen t-scheme -and-transitional -aid_en.pdf . 
28 Art. 37, Regulation (EU) No. 1307/2013.  
29 Art. 47(1), Regulation (EU) No. 1307/2013.  
30 Arts. 43 -47, Regulation (EU) No. 1307/2013.  WT/TPR/S/395 • European Union  
 
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  4.21.   Eight member States opted to allow farmers to meet some of their greening obligations 
through equivalent practices31 between 2014 and 2018.32 
4.22.   Following the 2016 review of greening, modifications to the underl ying delegated regulation33, 
aimed at simplifying elements of greening and increasing its effectiveness , were made in 2017.34 
They included flexibilities in the application of EFAs , and the prohibition of plant protection products 
on some EFAs from 2018.  
4.23.   The Omnibus Regulation also modified the greening provisions , so as to provide greater 
flexibility for member States . These changes notably included the extension of the list of EFA types 
to include areas with silvergrass ( Miscanthus) , cup plant ( Silphium perfoliatum or "cup plant ") and 
land lying fallow for melliferous plants. Some of these modifications were followed by changes to the 
delegated regulation.35 
Payment for the young farmers' scheme  
4.24.   Each member State is required to operate the young farmers' scheme36, which provides 
additional payments to farmers who benefit from Basic Payments or Single Area Payments, who are 
aged 40 years or under in the year of submission of the application under the scheme, and who are 
setting up in farming for the first  time as head of an agricultural holding, or who have already done 
so within the five years preceding the scheme. Member States may define further eligibility criteria 
as regards appropriate skills and/or training .37  
4.25.   Member States can reserve up to 2% of the national ceiling for direct payments to the scheme 
(Table 4.5 for effective financial allocations in 2018) and have the flexibility to decide the method 
for calculating the payment and the maximum number of hectares for which the payment is granted 
(betwee n 25 and 90).  
4.26.   The Omnibus regulation modified the scheme, in particular by  allowing member States to 
increase the additional payment that can be made to young farmers to up to 50% of a reference 
payment per hectare (from up to 25% prior to the Omnibus).38 
Redistributive payments and reduction of payments  
4.27.   Under the optional redistributive payment39, member States may allocate up to 30% of their 
national ceiling for direct payments to grant an extra payment for the first eligible hectares. The 
number of hectares eligible for this extra payment is limited to a maximum set by each member 
State up to 30 he ctares, or up to the average size of farms in the member State , if higher . 
                                                
31 Art. 43(3), Regulation (EU) No. 1307/2013.  
32 Austria, France, Ireland, Italy -Marche , the Netherlands, Poland, Portugal, the United Kingdom -
Scotland.  
33 Commission Delegated Regulation (EU) No. 639/2014 of 11 March 2014 supplementing Regulation 
(EU) No. 1307/2013 of the European Parliament and of the Council establishing rules for direct p ayments to 
farmers under support schemes within the framework of the common agricultural policy and amending Annex X 
to that Regulation. Viewed at: https://eur -lex.europ a.eu/legal -content/EN/TXT/?uri=CELEX%3A32014R0639 . 
34 Commission Delegated Regulation (EU) No. 2017/1155 of 15 February 2017 amending Delegated 
Regulation (EU) No. 639/2014 as regards the control measures relating to the cultivation of hemp, certain 
provisi ons on the greening payment, the payment for young farmers in control of a legal person, the 
calculation of the per unit amount in the framework of voluntary coupled support, the fractions of payment 
entitlements and certain notification requirements relat ing to the single area payment scheme and the 
voluntary coupled support, and amending Annex X to Regulation (EU) No. 1307/2013 of the European 
Parliament and of the Council. Viewed at: https://eur -lex.europa.eu/eli/reg_del/2017/1155/oj . 
35 Commission Delegated Regulation (EU) No. 2018/1784 of 9 July 2018 amending Delegated Regulation 
(EU) No. 639/2014 as regards certain provisions on the greening practices established by Regulation (EU) 
No. 1307/2013 of the European Parliament and of the Council. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32018R1784 . 
36 Arts. 50 and 51, Regulation (EU) No. 1307/2013.  
37 Bulgaria, Ireland, Spain, France, Hungary, Austria, Portugal, the Slovak Republic, and the two regions 
of Belgium and Northern Ireland in the United Kingdom apply such requirements  
38 Art. 50, Regulation (EU) No. 1307/2013.  
39 Arts. 41 and 42, Regulation (EU) No. 1307/2013.  WT/TPR/S/395 • European Union  
 
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  4.28.   Ten member States and regions opted for the redistributive payment. The amount of the 
per-hectare top -up payment decided  varied from EUR  25 for the first 52 hectares in France to 
EUR 127 for the first 30 hectares in Belgium (Wallonia) ( Table 4. 5). 
4.29.   Reduction of payments imposes a reduction of at least 5% (and up to 100%) to that part of 
the basic payments (i.e. Basic Payment Scheme, or Single Area Payment Scheme) that exceeds 
EUR 150,000. Member States may decide to apply several tranches of reduction above the 
EUR 150,000 threshold , and may subtract salaries linked to an agricultural activity before applying 
the reduction  (Table 4.5).  
4.30.   Member States using more than 5% of their annual n ational ceiling to grant a redistributive 
payment may decide not to impose the reduction of payments (Table 4.5).  
4.31.   The Omnibus Regulation foresees the possibility for member States to review their decisions 
on the reduction of direct payments on an annual b asis. In 2018, 23 member States applied the 
reduction of payments  (Table 4. 5). 
Payments for areas with natural constraints  
4.32.   In addition to various schemes under the rural development programmes that support areas 
with natural constraints40, each member Stat e has the option to reserve up to 5% of the national 
ceiling for support for areas with natural constraints.41 Denmark (since 2015) and Slovenia (since 
2017) are the only member States who decided to use this option.42 
Voluntary coupled support  
4.33.   EU member Sta tes have the possibility of using up to a maximum percentage of their annual 
national ceiling for direct payments to finance voluntary coupled support43, where payments are 
linked to production as notified by the EU to the WTO as blue box.  
4.34.   Out of the 27 mem ber States that apply the voluntary coupled support (all but Germany), 
9 have allocated to the scheme up to the baseline ceiling of 8% of their national ceiling for direct 
payments, 3 have allocated  between 8% and 13% (plus 2% to support protein crops), 11  have 
allocated  the maximum percentage of 13% (+ 2%) and 3 received the Commission's approval to 
provide more than 13% (+ 2%) (Table 4.5).44 One member State is using the derogation allowing 
member States to use EUR 3 million for voluntary coupled support.  
4.35.   The Omnibus Regulation introduced several changes. In particular , member States will have 
the possibility to review annually their decisions regarding coupled support. The European  
Commission was also empowered to adopt measures to avoid beneficiaries of voluntary coupled 
support suffer ing from structural market imbalance s. Among other changes, the Omnibus regulation 
also clarified, in addition to other pre -existing criteria , that this support is a production -limiting 
scheme .45 
                                                
40 Art. 32, Regulation (EU) No. 1305/2013.  
41 Arts. 48 and 49, Regulation (EU) No. 1307/2013.  
42 European Commission, Direct payments 2015 -2020 – Decisions taken by Member States: State of 
play as from December  2018, Information note . Viewed at: https://ec.europa.eu/info/sites/info/files/food -
farming -fisheries/ key_policies/documents/simplementation -decisions -ms-2018_en.pdf . 
43 Arts. 52 to 55, Regulation (EU) No. 1307/2013.  
44 Belgium, Finland and Portugal.  
45 Changes in Articles 52 and 53 of  Regulation (EU) No. 1307/2013 . WT/TPR/S/395 • European Union  
 
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  Table 4.5 Member State decisions regarding impleme ntation of direct payments in claim 
year 2018   
 
BPS/ 
SAPSa,b Redistributive  Reduction of 
paymentsc Young 
farmer 
payment  Voluntary coupled supportd 
Sectors/  
productions  
Belgium 
(Wallonia)  
43.85% 9.6%  First 30 
entitlements – 
EUR 127   None 1.9%  16.80%  Beef, milk, sheep 
meat  
Belgium 
(Flanders)   n.a.  Capping (i.e. 100% 
reduction) at 
EUR 150,000  Beef 
Bulgaria  47.80%  7.0%  First 30 ha – 
EUR 77  5% reduction over 
EUR 150,000 , capping 
(i.e. 100% reduction)  
at EUR  300,000, 
deduction s for salaries  
apply  0.2%  15.00%  Beef, fruit and 
vegetables , milk, 
protein, sheep 
meat 
Czech 
Republic  54.80%  n.a. n.a. 5% reduction over 
EUR 150,000  0.2%  15.00%  Beef, fruit and 
vegetables , hops, 
milk, protein, 
sheep  meat, 
starch potato, 
sugar beet  
Denmark  66.14% n.a. n.a. 5% reduction over 
EUR 150,000  0.6%  2.92% Beef 
Germany  62.35% 7% First 30 
entitlements  - 
EUR 50, next 
16 – EUR 30  None 1.0%  _   
Estonia  65.08% n.a. n.a. 5% reduction  over 
EUR 150,000, 
deduction s for salaries  
apply  0.3%  4.59% Fruit and 
vegetables , milk  
Ireland  68.17% n.a. n.a. Capping (i.e.100% 
reduction)  at 
EUR 150,000  2.0%  0.25% Protein  
Greece  59.48% n.a. n.a. Capping (i.e. 100% 
reduction)  at 
EUR 150,000, 
deduction s for salaries  
apply  2.0%  9.92% Beef, cereals, fruit 
and veg etables , 
nuts, protein, rice, 
seeds, sheep  
meat, silkworms, 
sugar beet  
Spain  58.11% n.a. n.a. 5% reduction  over 
EUR 150,000, 
deduction s for salaries  
apply  2.0%  11.99% Beef, fruit and 
vegetables , grain 
legumes, milk, 
nuts, protein, rice, 
sheep  meat, sugar 
beet 
France  44.00%  10% First 52 
entitlements – 
EUR 25  None 1.0%  15.00%  Beef, cereals, fruit 
and veg etables , 
hemp, hops, milk, 
protein, rice, 
seeds, sheep  
meat, starch 
potato  
Croatia  45.10% 10% First 20 
entitlements – 
EUR 33 None 2.0%  15.00%  Beef, fruit and 
vegetables , milk, 
protein, sheep  
meat, sugar beet  
Italy 59.10% n.a. n.a. 50% reduction over 
EUR 150,000 , capping 
(100% reduction) at 
EUR 500,000;  
deduction s for salaries  
apply  1.0%  12.00%  Beef, cereals, fruit 
and veg etables , 
milk, olive oil, 
protein crops, rice, 
sheep  meat, sugar 
beet 
Cyprus  61.72% n.a. n.a. 5% reduction over 
EUR 150,000  1.0%  8.00%  Fruit and 
vegetables , milk, 
sheep  meat 
Latvia  53.75% n.a. n.a. 5% reduction over 
EUR 150,000, after 
deduction s for salaries  1.3%  15.00%  Beef, cereals, fruit 
and veg etables , 
milk, oilseeds, 
protein, seeds, 
sheep  meat, 
starch potato  WT/TPR/S/395 • European Union  
 
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BPS/ 
SAPSa,b Redistributive  Reduction of 
paymentsc Young 
farmer 
payment  Voluntary coupled supportd 
Sectors/  
productions  
Lithuania  38.75% 15% First 30 ha – 
EUR 49  None  1.3%  15.00%  Beef, cereals, fruit 
and veg etables , 
milk, protein, 
seeds, sheep  
meat, sugar beet  
Luxemb ourg 68.02% n.a. n.a. 5% reduction over 
EUR 150,000, 
deduction s for salaries  
apply  1.5%  0.48% Protein  
Hungary  54.60%  n.a. n.a. 5% reduction over 
EUR 150,000; capping 
(100% reduction)  at 
EUR 176,000, 0.4%  15.00%  Beef, fruit and 
vegetables , milk, 
protein, rice, 
sheep  meat, sugar 
beet 
Malta  12.38% n.a. n.a. 5% reduction  over 
EUR 150,000  0.4%  57.22% Beef, fruit and 
vegetables , milk, 
sheep  meat 
Netherlands  69.61% n.a. n.a. 5% reduction  over 
EUR 150,000  2.0%  0.49% Beef, sheep  meat 
Austria  68.00% n.a. n.a. Capping (i.e. 100% 
reduction)  at 
EUR 150,000, 
deduction s for salaries  
apply  2.0%  2.10%  Beef, sheep  meat 
Poland  45.70%  8.6%  First 3 ha – 
EUR 0, next  
27 ha – 
EUR 40  Capping (i.e. 100% 
reduction)  at 
EUR 150,000  1.0%  14.73% Beef, flax, fruit 
and veg etables , 
hemp, hops, milk, 
protein, sheep  
meat, starch 
potato, sugar beet  
Portugal  46.30% 3.9%   First 5 ha – 
EUR 50  5% reduction  over 
EUR 150,000, capping 
(i.e. 100% reduction)  
at EUR  300,000,  
deduction s for salaries  
apply  2.0%  19.90%  Beef, fruit and 
vegetables , milk, 
rice, sheep  meat 
Romania  52.84% 5.3%  First 5  ha – 
EUR 5, next 
25 ha - 
EUR 51  None 1.0%  12.95% Beef, fruit and 
vegetables , grain 
legumes, hemp, 
hops, milk, 
protein, rice, 
sheep  meat, 
silkworms, sugar 
beet, seeds  
Slovenia  54.97% n.a. n.a. 5% reduction  over 
EUR 150,000, 
deduction s for salaries  
apply  1.5%  13.00%  Beef, cereals, fruit 
and veg etables , 
milk 
Slovak 
Republic  58.21% n.a. n.a. 5% reduction  over 
EUR 150,000  0.2%  13.00%  Beef, fruit and 
vegetables , hops, 
milk, sheep  meat, 
sugar beet  
Finland  50.10% n.a. n.a. 5% reduction  over 
EUR 150,000  1.0%  19.60%  Beef, cereals, fruit 
and veg etables , 
milk, protein, 
sheep  meat, 
starch potato, 
sugar beet  
Sweden  57.60% n.a. n.a. 5% reduction  over 
EUR 150,000  1.5% 13.00%  Beef WT/TPR/S/395 • European Union  
 
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BPS/ 
SAPSa,b Redistributive  Reduction of 
paymentsc Young 
farmer 
payment  Voluntary coupled supportd 
Sectors/  
productions  
United 
Kingdom  
(England)   
65.80%  2.0%  n.a. 5% reduction  over 
EUR 150,000   
0.5%  1.70%   
United 
Kingdom  
(Northern 
Ireland )  n.a. Capping (i.e. 100% 
reduction)  at 
EUR 150,000    
United 
Kingdom  
(Scotland)  n.a. 5% reduction  over 
EUR 150,000, capping 
(ie. 100% reduction)  
at EUR  600,000   Beef, sheep meat  
United 
Kingdom  
(Wales)  First 5 4 
entitlements – 
EUR 26  15% reduction  over 
EUR 150,000, 30% 
reduction  over 
EUR 200,000, 55% 
reduction  over 
EUR 250,000, capping 
(i.e. 100% reduction)  
at EUR  300,000    
n.a. Not appl icable . 
a % for BPS/SAPS, redistributive, young farmer payment, and voluntary coupled support refers to 
percentage of national direct payments ceiling for claim year 2018 . 
b BPS = Basic Payment Scheme ; SAPS = Single Area Payment Scheme.  
c The reductions of payments are a percentage of reductions applying to the total amount of the basic 
payments (BPS or SAPS ). Member States may also deduct the amounts of salaries actually paid for 
agriculture.  
d Beef refers to beef and veal, protein refers to protein crops, milk refe rs to milk and milk products, 
and sheep meat refers to sheep and goat me at. 
Note:  30% of each national ceiling is reserved for greening , therefore, percentage allocations add up to 
70% in all cases except Denmark and Slovenia, which are the member States to allocate some of 
Pillar I to areas with natural constraints (0.4% of the national ceiling in Denmark since 2015 , and 
1.58% of the nati onal ceiling in Slovenia  since 2017) . 
Source:  European Commission , Direct payments 2015 -2020– Decisions taken by Member States . Regulation 
2018/891 provides the budgetary ceilings corresponding to the percentages of allocation notified for 
calendar year 20 18. 
4.36.   According to the EU Commission, for the voluntary coupled support, member States are 
planning to spend between EUR 4.1 and EUR  4.22 billion per year, distributed among approximately 
260 measures. The most supported sectors remain the three animal -related sectors (beef and veal, 
41% of the total ; dairy products, 20%; and sheep and goat meat, 12%) followed by  protein crops, 
fruit and vegetables, and sugar beet.46  
4.37.   In addition to voluntary coupled support, the EU provides for payment for cotton in Bulgaria,  
Greece and Spain (Table 4.6).47  
Table 4.6 Crop -specific payment for cotton  
 Area  
(ha) Fixed yield  
(tonne/ha)  Payment  
(EUR/ha)  
Bulgaria  3,342  1.2 2015: 584.88  
   2016 and onward: 649.45  
Greece  250,000  3.2 234.18  
Spain  48,000  3.5 362.15  
Source:  Regulation (EU) No. 1307/2013, Article 58.  
                                                
46 European Commission, Direct payments 2015 -2020 – Decisions taken by Member States: State of 
play as from December  2018, Information note . Viewed at: https://ec.europa.eu/info/sites/info/files/food -
farming -fisheries/key_policies/documents/simplementation -decisions -ms-2018_en.pdf . 
47 Arts. 56 -58, Regulation (EU) No. 1307/2013 also provide for payments in Portugal fo r a national base 
area of 360 ha but there is no production in Portugal, and no payments are made.  WT/TPR/S/395 • European Union  
 
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  Discussions on CAP beyond 2020  
4.38.   In February 2017,  the European Commission launched a three -month consultation on the 
future of the CAP, followed by a conference on the future of the CAP in July 2017, and circulated, on 
29 November 2017, a communication on the "Future of Food and Farming".48  
4.39.   Following thi s preparatory process  and as part of the Commission proposals for the 
Multiannual  financial  framework  (MFF) 2021-27, on 1 June 2018, the Commission published three 
legislative proposals for a reform of the CAP beyond 2020: ( i) a regulation establishing rul es on 
strategic plans to be drawn up by member States under the CAP49; (ii) a regulation amending 
Regulation (EU) No. 1308/2013 establishing a common market organization and some other 
regulations50; and ( iii) a horizontal regulation on the financing, managi ng and monitoring of the 
CAP.51 
4.40.   The proposals identified three general objectives to be pursued through EU support, funded 
by the EAGF and by the EAFRD under the CAP: (i) to foster a smart, resilient and diversified 
agricultural sector ensuring food securit y; (ii) to bolster environmental care and climate action, and 
to contribute to the environmental - and climate -related objectives of the EU; (iii) to strengthen the 
socio-economic fabric of rural areas.  
4.41.   These three general objectives ought to be achieved t hrough nine specific objectives: 
(i) support viable farm income and resilience across the territory, to enhance food security; 
(ii) enhance market orientation and increase competitiveness, including greater focus on research, 
technology and digitalization;  (iii) improve farmers' position in the value chain; (iv) contribute to 
climate change mitigation and adaptation, and sustainable energy; (v) foster sustainable 
development and efficient management of natural resources, such as water, soil and air; 
(vi) contribute to the protection of biodiversity, enhance ecosystem services, and preserve habitats 
and landscapes; (vii) attract young farmers, and facilitate business development in rural areas; 
(viii) promote employment, growth, social inclusion and local dev elopment in rural areas, including 
bio-economy and sustainable forestry; and (ix) improve the response of EU agriculture to societal 
demands on food and health, including safe, nutritious and sustainable food, and animal welfare.  
4.42.   Each member State is expe cted to prepare strategic plans setting out how to meet the 
objectives , to be assessed through performance and an evaluation based on a set of common 
indicators related to output, result and impact. According to the Commission, the proposals are 
notably ch aracterized by more flexibility in the use of funding allocation (including the transfer 
between rural development and direct payments of up to 15% of the CAP allocations), better 
targeting of support (with a focus on SMEs and young farmers), a higher leve l of ambition regarding 
environmental and climatic requirements, greater use of knowledge and innovation, the provision of 
complementary support for young farmers , and a stronger focus on support for small and 
medium -sized farms .52 
                                                
48 European Commission, The Future of Food and Farming. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A52017DC0713 . 
49 Proposal for a Regulation of the European Parliament and of the Council establishing rules on support 
for strategic plans to be drawn up by Member States under the Common agricultural policy (CAP Strategic 
Plans) and financed by the European Agricultural Guarantee Fund (EAGF) and by the European Agricultural 
Fund for Rural Development (EAFRD) and repealing Regulation (EU) No.  1305/2013 of the European Parliament 
and of the Council and R egulation (EU) No. 1307/2013 of the European Parliament and of the Council. Viewed 
at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=COM%3A2018%3A392%3AFIN .  
50 Proposal for a Regulation of the European Parliament and of the Council amending Regulations (EU) 
No. 1308/2013 establishing a common organisation of the markets in agricultural products, (EU) 
No. 1151/2012 on quality schemes for agricultural products and  foodstuffs, (EU) No. 251/2014 on the 
definition, description, presentation, labelling and the protection of geographical indications of aromatised wine 
products, (EU) No.  228/2013 laying down specific measures for agriculture in the outermost regions of t he 
Union and (EU) No.  229/2013 laying down specific measures for agriculture in favour of the smaller Aegean 
islands.  Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1530715098374&uri=CELEX%3A52018PC0394R%2801%29 . 
51 Proposal for a Regulation of the European Parliament and of the Council on the financing, 
management and monitoring of the common agricultural policy and repealing Re gulation (EU) No. 1306/2013. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=COM%3A2018%3A393%3AFIN . 
52 European Commission, EU budget: the Common Agri cultural Policy beyond 2020. Viewed at: 
https://europa.eu/rapid/press -release_IP -18-3985_en.htm ; and European Parliament, CAP strategic plans. WT/TPR/S/395 • European Union  
 
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  4.43.   As of October 2019, the p roposals of the Commission from June 2018 to September 2019 
were still under discussion in the inter -institutional process with the European Parliament and the 
Council. The outcome of these discussions cannot be pre -judged.  
4.1.1.2.1.2   Internal market support measures  
4.44.   For the purposes of this Section, internal market support measures are defined as those that 
work inside the customs territory of the EU to support prices paid to farmers through reduced 
production or other supply control measures, or by encouraging consu mption, as well as some 
regulatory measures and aids covered by the EU common organization of the markets. Market access 
and export measures, which can also lead to positive transfers to producers through higher domestic 
prices, are dealt with below under export subsidies and export measures with equivalent effect and 
market access.  
4.45.   The Common Market Organisation (CMO) for agricultural products set out in Regulation (EU) 
No. 1308/2013 was also amended by the Omnibus Regulation.53 Regarding producer organizations, 
some activities, such as planning production, optimizing production costs , placing on the market, 
and negotiating contracts for the supply of agricultural products, were extended beyond sectors like 
olive oil, beef and arable crops, for which they already existed. The possibility for farmers and their 
first purchasers to negoti ate collectively voluntary value -sharing clauses was also extended to 
sectors other than sugar.  
4.46.   The reserve for crises  in the agricultural sector (EUR 400 million in 2011 prices, corresponding 
to EUR 469 million in the 2019 budget) has not been used since its establishment in 2014, and the 
money set aside each year has been made available again to farmers.54 
4.47.   In order to pr ovide more flexibility to member States to support farmers, notably in times of 
crisis, the EU revised its rules on state aid in the agricultural sector55 to raise the de minimis level 
of national support that can be provided to a farmer without approval by  the Commission, from 
EUR 15,000 per period of three years to EUR  20,000, and EUR  25,000 under certain conditions, with 
a national ceiling of 1.25% and 1.5%, respectively, of the national agricultural output for a period 
of three years.  
4.48.   Intervention and pr ivate storage aid were used only for skimmed milk powder in 2017 
(Table  4.7).  
Table 4.7 Intervention and private storage aid, 2017 and 2018  
(Tonnes)  
 Intervention 
price  
EUR/tonne  Period  Limitsg Purchases  
2017  Purchases 
2018  Sales  
2017  Sales 
2018  
Common wheata 101.31  1 Nov. -31 May  3,000,000      
Durum wheata 101.31  1 Nov. -31 May  0     
Barleya 101.31  1 Nov. -31 May  0     
Maizea 101.31  1 Nov. -31 May  0     
Paddy riceb 150.00  1 Apr. -31 July  0     
Beef and vealc 1,890.40  All year  0     
                                                
Viewed at:  
http://www.europarl.europa.eu/RegData/etudes/BRIE/2018/630324/EPRS_BRI(2018)630324_EN.pdf . 
53 Regulation (EU) No. 1308/2013 of the European Parliament an d of the Council of 17 December 2013 
establishing a common organization of the markets in agricultural products and repealing Council Regulations 
(EEC) No. 922/72, (EEC) No. 234/79, (EC) No. 1037/2001 and (EC) No. 1234/2007, as amended by the 
regulation (E U) No. 2017/2393 of the European Parliament and of the Council of 13 December 2017. Viewed 
at: https://eur -lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L :2013:347:0671:0854:EN:PDF . 
54 The measures listed below were therefore financed without having recourse to the reserve.  
55 Commission Regulation (EU) 2019/316 of 21 February 2019 amending Regulation (EU) 
No. 1408/2013 on the application of Articles 107 and 108 of the Treaty on the Functioning of the 
European  Union to de minimis aid in the agriculture sector. Viewed at: https://eur -lex.europa.eu/legal -
content/GA/TXT/?uri=CELE X:32019R0316 . WT/TPR/S/395 • European Union  
 
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   Intervention 
price  
EUR/tonne  Period  Limitsg Purchases  
2017  Purchases 
2018  Sales  
2017  Sales 
2018  
Butterd 2,217.51  1 Mar. -30 Sept.  50,000      
Skimmed milk 
powdere 1,698.00  1 Mar. -30 Sept.  109,000f 29,193   2,170  202,624  
 Reference price  
EUR/tonne  Aid for 
storage 
2017  Aid for 
storage 
2018  
White sugarh 404.40    
Raw sugar  335.20    
Olive oil     
Extra virgin  1,779.00    
Virgin  1,710.00    
Lampante 
(2 degrees)  1,524.00    
Beef and veal  2,224 .00   
Butter  2,463.90    
Cheese   
  
Skimmed milk 
powder  1,698.00  24,606   
Pig meat  1,509.39   
Sheep and goat 
meat  
  
Flax fibre   
  
a The reference price for the cereal sector is fixed at EUR  101.31 per tonne , and the public 
intervention price is equal to the reference threshold (Article 7.1(a) of Regulation (EU) 
No. 1308/2013 and Article 2.1(a) of Council Regulation EU No. 1370/2013).  
b The reference price for paddy rice is fixed at EUR  150 per tonne , and the public intervention price is 
equal to the reference threshold (Article 7.1(b) of Regulation (EU) No. 1308/2013 and Article 2.1(a) 
of Council Regulation EU No. 1370/2013).  
c The public intervention price for beef and veal shall not exceed 85% of the reference threshold 
(Articles 7.1(d) and 13.1(c) of Regulation (EU) No. 1308/2013).  
d The public intervention price for butter is 90% of the reference price (Article 2.1(b) of Council 
Regulation EU No. 1370/2013).  
e The public intervention price for skimme d milk powder is equal to the reference price (Article 2.1(a) 
of Council Regulation EU No. 1370/2013).  
f By way of derogation, the quantitative limit was set at 0 for 2018 and 2019 (Council Regulations 
(EU) 2018/147 and 2018/1554).  
g Beyond the limit, buyi ng in shall be carried out by way of a tendering procedure, with the maximum 
price not exceeding the intervention price (Article 3 of Council Regulation EU No. 1370/2013) . 
h Only white sugar is eligible for the aid for private storage (Article 17 of Regula tion (EU) 
No. 1308/2013).  
Note:  There are no "sales" from private storage , as property remains with the private operators who store 
the product under contract with no obligation to sell at the end of the contract period.  
Source:  Regulation (EU) No. 1308/20 13 of the European Parliament and of the Council  of 17 December 2013 
establishing a common organisation of the markets in agricultural products and repealing Council 
Regulations (EEC) No . 922/72, (EEC) No . 234/79, (EC) No . 1037/2001 and (EC) No . 1234/2007 . 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/ALL/?uri=celex%3A32013R1308 ; and  Council 
Regulation (EU) No. 1370/2013  of 16 December 2013 determining measures on  fixing certain aids 
and refunds related to the common organisation of the markets in agricultural products. Viewed at:  
https://eur -lex.europa.eu/LexUriSe rv/LexUriServ.do?uri=OJ:L:2013:346:0012:0019:EN:PDF ; and 
European Commission.  
Dairy and livestock  
4.49.   The various exceptional measures, including adjustment aid to milk producers and farmers in 
other livestock sectors adopted in 2016 in response to severe market disturbance, including  WT/TPR/S/395 • European Union  
 
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  overproduction, fallling prices, and  the ban on imports of certain agric ultural products by the 
Russian  Federation in August 201456, have been implemented in  2016 and  2017.57 
4.50.   The butter and skimmed milk powder stocks accumulated during the period 2015 -17, with 
total public and private stocks of skimmed milk powder reaching more than 415,000 tonnes at the 
end of 2016; public intervention stocks reached 380,000 tonnes  at the end of 2017. The intervention  
stocks were progressively put back on the market through a tendering process, and decreased 
regularly in 2018 and in the first ha lf of 2019, down to zero in July 2019.58  
4.51.   In 2019, an amount of EUR 50 million of EU funding, to be matched by national funds to a 
maximum amount of EUR  100 million, was made available for a temporary exceptional adjustment 
aid to farmers in the beef and ve al sector in Ireland59, due to particular challenges faced by the 
sector, including concerns over the sector's contribution to GHG emissions, falling domestic 
consumption, and the uncertainty around the withdrawal of the United Kingdom from the EU.  
Fruits and vegetables  
4.52.   The legal framework for fruit and vegetables, defined by Regulation (EU) No. 1308/2013 and 
Commission Implementing Regulation (EU) No.  543/2011, was amended and complemented in 
March 2017 by Commission Delegated Regulation (EU) 2017/89160 and Commission Implementing 
Regulation (EU) 2017/892 of 13 March 2017, and again in December 2017 by the Omnibus 
Regulation.  
4.53.   As described by the Commission61, the new provisions agreed in 2017 aimed at simplifying 
rules, reducing administrative burden and pro viding greater financial support in times of crises, 
notably through: ( i) an increase of the withdrawal prices for free distribution and for other purposes 
(compost, animal feed, distillation, etc); ( ii) greater attractivity of producer organizations, by 
providing more clarity about the actions eligible to EU funding and by setting at 25% the maximum 
percentage of products than can be marketed outside the producer organization (subject to 
modification by the member States); and ( iii) simplification and clar ification of the legislation with 
regards to transnational producer organizations and their associations.  
4.54.   Support for fruit and vegetable production is focused on producer organizations that can use 
their operational funds to finance operational programme s submitted to and approved by EU member 
States.  
4.55.   Operational programmes in the fruit and vegetable sector must have at least two objectives 
among a list of objectives, including specifically62 for the fruit and vegetable sector: planning of 
production; imp rovement of product quality; boosting products' commercial value; promotion of the 
products; environmental measures; and crisis prevention and management. The following type of 
activities are covered under this latter objective: market withdrawal; green ha rvesting or 
non-harvesting; promotion and communication; training measures and exchange of best practices; 
harvest insurance; support for the administrative costs of the setting up and replenishment of mutual 
funds (farmer -owned stabilization funds); inves tments making the management of the volumes 
                                                
56 WTO document WT/TPR/S/357/Rev.1, 13 October 2017.  
57 According to the Commission, out of the original budget of EUR 150 million allocated for milk 
production reduction under Commission Delegated Regulation (EU) 2016/1612, close to EUR  112 million had 
been disbursed. European Commission, Final figures reflect success of EU milk production reduction scheme. 
Viewed at: https://ec.e uropa.eu/info/news/final -figures -reflect -success -eu-milk-production -reduction -
scheme_en . 
58 European Commission, Milk market observatory . Viewed at: https://ec.europa.eu/agriculture /market -
observatory/milk_en . 
59 Commission Implementing Regulation (EU) 2019/1132 of 2 July 2019 providing temporary 
exceptional adjustment aid to farmers in the beef and veal sector in Ireland. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32019R1132 . 
60 Further amended by Commission Delegated Regulation (EU) 2018/1145 of 7 June 2018 amending 
Delegated Regulation (EU) 2017/891 as regards producer o rganisations in the fruit and vegetables sector,  as 
regards the temporary exceptional support measures for producers of peaches and nectarines in Greece, Spain 
and Italy. Viewed at: https://eur -lex.europa.eu/legal -content/en/TXT/?uri=CELEX%3A32018R1145 . 
61 European Commission, Simpler rules and more support for fruit and vegetable producers. Viewed at: 
https://europa.eu/rapid/press -release_IP -17-526_en.htm . 
62 In addition to the general list of objectives for all producer organizations.  WT/TPR/S/395 • European Union  
 
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  placed on the market more efficient; replanting of orchards following mandatory grubbing up; and 
coaching for other producer organizations, associations thereof, or individual producers.63 
4.56.   In parallel, the tempora ry exceptional measures for fruit and vegetables to reduce supply in 
response to the ban on imports of certain agricultural products by the Russian Federation in 
August  201464 were complemented by a further tranche of support through Commission Delegated 
Regulation (EU) 2017/1165 of 20 April 2017 and implemented until the end of June 2018. These 
measures increased EU financial support for the activation of existing provisions on market 
withdrawals, green harvesting and non -harvesting.  
Sugar  
4.57.   The sugar quota regime, introduced in 1968, came to an end on 30 September 2017. White 
sugar remains eligible for private storage . While  this provision was maintained it has  not been used 
thus far . The existing provisions for agreements between EU beet producers and sugar processors, 
including value -sharing clauses, are maintained.  
Responses to sanitary crises  
4.58.   From 2017 to 2019, the EU continued to adopt measures to address animal disease and 
quarantin e pest outbreaks, and, in particular, the wave of highly pathogenic avian influenza (HPAI) 
and African swine fever in wild boar and domestic pigs outbreaks confirmed on its territory over the 
last years (Section 3.3.3). This included the co -financing of sp ecific measures and veterinary 
programmes to prevent, control, eradicate and compensate for the losses and damage caused by 
animal diseases and plant pests pursuant to available instruments65 in addition to EU member States' 
national aid.66 
4.59.   From 2017 to 2019 , the EU also enacted exceptional measures to compensate farmers for 
economic losses resulting from the sanitary crises in the poultry and pigmeat sectors (Table 4.8) , in 
addition to the instruments already available to face such situations.  
Table 4.8 Market support measures for poultry and pigmeat, linked to sanitary crises, 
2017 -19 
Date  Delegated 
Regulation (EU) No.  Description  
20 February 2017  Commission 
Implementing 
Regulation 2017/295  Exceptional support measures for the poultry meat sector in 
France  to support the market affected by HPAI H5 
(maximum co -financing: EUR 40 million)  
5 April 2017  Commission 
Implementing 
Regulation 2017/647  Exceptional support measures for the pigmeat marke t in 
Poland to grant aid to producers whose holdings were 
subject to animal health measures for the control of African 
swine fever (maximum co -financing: 50% of the aid 
covering a maximum of 50 ,000 animals ) 
                                                
63 Art. 33, Regulation (EU) No. 1308/2013.  
64 WTO doc ument WT/TPR/S/357/Rev.1, 13 October 2017.  
65 See, in particular, Council Decision 90/424 of 26 June 1990 on expenditure in the veterinary field 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=celex%3A31990D0424 ; Regulation (EU) 
652/2014 of the European Parliament and of the Council of 15  May 2014 laying down provisions for the 
management of expenditure relating to the food chain, animal health and animal we lfare, and relating to plant 
health and plant reproductive material, amending Council Directives 98/56/EC, 2000/29/EC and 2008/90/EC, 
Regulations (EC) No.  178/2002, (EC) No.  882/2004 and (EC) No.  396/2005 of the European Parliament and of 
the Council, Dire ctive 2009/128/EC of the European Parliament and of the Council and Regulation (EC) 
No. 1107/2009 of the European Parliament and of the Council and repealing Council Decisions 66/399/EEC, 
76/894/EEC and 2009/470/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32014R0652 ; and Regulation (EU) 1305/2013 of the European Parliament and 
of the Council  of 17 December 2013 on support for rural developme nt by the European Agricultural Fund for 
Rural Development (EAFRD) and repealing Council Regulation (EC) No.  1698/2005. Viewed at: https://eur -
lex.europa.eu/legal -conten t/EN/TXT/?uri=celex%3A32013R1305 . 
66 Art. 26, Commission Regulation (EU) No. 702/2014.  WT/TPR/S/395 • European Union  
 
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  Date  Delegated 
Regulation (EU) No.  Description  
11 September 2017  Commission 
Implementing 
Regulation 2017/1536  Emergency measure in the form of aid to holdings with no 
more than 50 animals of the porcine species located in 
certain areas of Poland when ceasing pig meat production 
due to new requirements in relation to African swine fever 
(maximum co -financing: EUR 9.3 million)  
19 February 2018  Commission 
Implementing 
Regulation 2018/252  Exceptional market support measures for the poultry sector 
in France  to support the market affected by HPAI H5 
between 1 December 2016 and 30 June 2 017 (maximum 
co-financing: EUR 32.5 million)  
10 October 2018  Commission 
Implementing 
Regulation (EU) 
2018/1506  Exceptional market support measures for the egg and 
poultry meat sectors in Italy affected by HPAI H5 and H7 
between 30 April 2016 and 28  Septem ber 2017 (maximum 
co-financing: EUR 11.1 million)  
10 October 2018  Commission 
Implementing 
Regulation 2018/1507  Exceptional market support measures for the egg and 
poultry meat sectors in Poland affected by HPAI H5 between 
3 December 2016 and 16  March  2017 (maximum 
co-financing: EUR 1.411 million ) 
2 August 2019  Commission 
Implementing 
Regulation (EU) 
2019/1323  Exceptional market support measures for the egg and 
poultry  meat sectors in Italy affected by HPAI H5 between 
1 October 2017 and 30  June 2018 (maximum co -financing: 
EUR 32.1 million ) 
Source:  WTO Secretariat.  
Responses to adverse weather conditions  
4.60.   Adverse weather conditions in 2017, 2018 and 2019 triggered exceptional responses at the 
EU level. In 2017, 15 member States were first allowed to increase advance payments to farmers 
affected by heavy rains and drought67, before an exceptional aid package for a total amount of 
EUR 15 million, to be matched by national funds, was granted to Lithuania, Latvia, Estonia and 
Finland, following heavy rainfalls in the second half of the year.68 Higher advanced payments to 
farmers were also granted following drought conditions in the summer of 2018.69 
4.61.   On account of drought in 2017, exceptional rainfalls or snowfalls in late 2017 and the 
beginning of 2018, and drought again in the summer of 2018, affecting several member States, 
derogations were also granted in relation to certain greening rules (crop diversification and EFAs).70 
Similar measures were announced on 25 July 2019 as a result of the new wav e of drought 
conditions.71 
4.62.   These exceptional measures came in addition to the instruments already available to face 
such situations, including rural development risk management tools, and options provided to fund 
investment costs to restore agricultural lan d and production potential damaged in the case of natural 
disasters.72  
4.63.   Agricultural state aid rules also provide that aid of up to 80% of the damage caused by drought 
(or up to 90% in Areas of Natural Constraints) can be provided, subject to certain specif ic conditions, 
                                                
67 European Commission, Farmers from five more countries to receive support for tackling climate -
related problems. Viewed at: https://ec.europa.eu/info/news/farmers -five-more-countries -receive -support -
tackling -climate -related -problems_en . 
68 Commission Implementing Regulation (EU) 2018/108 of 23 Jan uary 2018 on an emergency measure 
in the form of aid to farmers due to the floods and heavy rainfalls in certain areas of Lithuania, Latvia, Estonia 
and Finland. Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32018R0108 . 
69 European Commission, Commission offers further support to European farmers dealing with droughts. 
Viewed at: https://europa.eu/rapid/press -release_IP -18-4801_en.htm . 
70 Commission Implementing Decisions C(2017) 5807 of 28 August 2017, C(2018)2102 of 
12 April 2018, C(2018)3861 of 21 June 2018, C( 2018)5458 of 14 August 2018 and C(2018)6085 of 
18 September 2018. European Commission, Drought in Europe.  Viewed at: 
https:// ec.europa.eu /commission /news/ drought -europe -2018-aug-30_en. 
71 European Commission, Drought in Europe: the Commission offers further support to European 
farmers.  Viewed at: https://europa.eu/rapid/press -release_IP -19-4729_fr.htm . 
72 Arts. 18 and 36, Regulation (EU) No. 1305/2013 of the European Parliament and of the Council of 
17 December 2013 on support for rural development.  WT/TPR/S/395 • European Union  
 
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  and that the purchase of fodder can qualify for aid as income loss .73 Several member States 
announced emergency compensations  in this regard for farms affected by the drought.74  
Other  
4.64.   The total allocation earmarked for the distribution of fru it including bananas, vegetables, and 
milk and milk products under the School Scheme75 for the 2019/20 school year amounted to 
EUR 250 million (EUR 145 million for fruit and vegetables, and EUR 105 million for milk and other 
dairy products), allocated among the 28 EU member States.76 
4.65.   The Fund for European Aid to the Most Deprived (FEAD), which is administered by the 
Directorate -General for Employment, Social Affairs and Inclusion  (DG EMPL), supports the member 
States' actions to provide material assistance to deprived persons, including food aid, based on each 
member State's operational programme. A total of EUR 3.8 billion in real terms was earmarked for 
the FEAD for 2014 -20, with additional co -financing of at least 15% from member States.77  
4.66.   In November 2018, the Commission adopted the work programme for 201978 on information 
provision and promotion measures  for agricultural products  on internal and external markets.79 
EU co-financing rates range from 7 0% to 85%.80 The total amount available in 2019 increased , to 
EUR 201.1  million, from EUR 142.5 million in 2017 and EUR  188.6 in 2018, notably in order to help 
boost export s to alternative markets for EU agricultural products .81  
4.67.   To address the fast evolutio n in the organic sector , a new regulation on organic production 
and labelling was adopted in May 2018.82 This will apply from  1 January 2021. According to the 
                                                
73 European Commission, Drought in Europe.  Viewed at: 
https:// ec.europa.eu /commission /news/ drought -europe -2018-aug-30_en; and Art. 25, Commission Regulation 
(EU) No. 702/2014.  
74 Farm Europe, Drought in Europe Summer 2018: Crisis Management in an Orderly Chaos. Viewed at: 
https://www.farm -europe.eu/blog -en/drought -in-europe -summer -2018-crisis-management -in-an-orderly -
chaos/ . 
75 Resulting from the merging of th e School Fruit and Vegetables and School Milk Schemes, following 
Regulation (EU) 2016/791, Commission Implementing Regulation (EU) 2017/39, Commission Delegated 
Regulation (EU) 2017/40.  
76 European Commission, The EU school fruit, vegetables an d milk scheme. Viewed at: 
https://ec.europa.eu/commission/news/eu -school -fruit-vegetables -and-milk-scheme -2019-mar-27_en ; 
Commission Implementing  Decision C(2019) 2249 final of 27 March 2019 fixing the definitive allocation of 
Union aid to Member States for school fruit and vegetables and for school milk for the period from 
1 August  2019 to 31 July 2020 and amending Implementing Decision C(2018)176 2 final. Viewed at: 
https://ec.europa.eu/info/sites/info/files/food -farming -fisheries/key_policies/documents/comm ission -decision -
c2019 -2249_en.pdf ; and European Commission, School year 2019 -2020.  Viewed at: 
https://ec .europa.eu/info/sites/info/files/food -farming -fisheries/key_policies/documents/school -scheme -
budget -by-country -2019-20_en.pdf . 
77 European Commission , Fund for European Aid to the Most Deprived (FEAD) . 
https://ec.europa.eu/social/main.jsp?catId=1089 .  
78 Commission Implementing Decision of 14 November 2018 on the adoption of the work programme for 
2019 of information provision and promotion measures concerning agricultural products implemented in  the 
internal market and in third countries in application of Regulation (EU) No. 1144/2014 of the European 
Parliament and of the Council. Viewed at: 
https://ec.europa.eu/research/participants/data/ref/other_eu_prog/agriprod/wp -call/agriprod -wp-2019_en.pdf . 
79 Consisting of either simple programmes (submitted by one or several proposing organizations from 
the same member State); or multi  programmes (submitted by at least two proposing organizations from at 
least two member States, or one or more EU organizations). See point 1.2 of Annex I of the Commission 
Implementing Decision of 14 November 2018.  
80 Subject to approval, the EU co -financi ng would amount to: 70% for simple programmes; 80% for 
multi programmes and third countries; 85% for crisis programmes; and up to 90% for beneficiaries from 
member States under EU financial assistance. See Annex I of the Commission Implementing Decision of  
14 November 2018.  
81 European Commission, Commission to focus on growth markets for EU food and drink in 2018 
promotion programmes. Viewed at: https://ec.europa.eu/info/news/commission -focus-growth -markets -eu-
food-and-drink-2018-promotion -programmes_en . 
82 Regulation (EU) 2018/848 of the European Parliament and of the Council of 30 May 2018 on organic 
production and labelling of organ ic products and repealing Council Regulation (EC) No. 834/2007. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=uriserv%3AOJ.L_.2018.150.01.0001.01.ENG . WT/TPR/S/395 • European Union  
 
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  Commission83, it was designed to modernize the sector, harmonize rules, and ensure fair competition  
for farmers , while preventing fraud and maintaining consumer confidence. Production rules should 
be simplified and the control system strengthened . It should also operate a shift from the principle 
of equivalence to the principle of conformity: producers from third countries should be required to 
comply with the same set of rules as those prevalent in the EU. The new rules also set out 
simplification elements , such as  the establishment of a procedure exempting low -risk operators from 
the yearly control, and the introduction of the group certification scheme for small producers , with 
a view to reducing administrative and certification costs. The reform also includes a w ider range of 
products eligible for organic certification84, as well as new rules to facilitate the conversion to organic 
production .85  
4.68.   On 12 June 2019 , the Commission approved the 28 EU member States' national programmes 
in favour of apiculture , pursuant t o Articles 55 to 57  of EU Regulation 1308/201386, for a total amount 
of EUR 120 million , during the period starting on 1 August 2019 and running until 31 July 2022, an 
increase of EUR 12 million compared to the previous three -year period, reflecting the imp ortance of 
the sector. National apiculture programmes  are co -financed by the EU at a level of 50%.  
4.69.   Adding to the already existing EU Market Observatories  for the milk and meat markets, 
two new observatories were put in place in 2017, for the crops and suga r markets; the latter is in 
anticipation of the end of the quota system. The creation of two more observatories for wine and  for 
fruit and vegetables was announced in February 2019.  
4.1.1.2.1.3   Rural development  
4.70.   Rural development, or Pillar II of the CAP, is funded through the EAFRD under Regulation 
(EU) No.  1305/2013 of 17 December 2013, and secondary regulations.87 
4.71.   In addition to the funds provided by the EU under the EAFRD, member States provide 
co-funding at rates that depend on the type of project and the member State. Total funding from 
the EAFRD for 2014 -20 is EUR 100 billion, and co -funding from the member States is an additional 
EUR 61 billion (with different co -financing rates depending on the measure and region involved).88 
The national envelopes for E ARFD funding are shown in Table 4.9.  
Table 4.9 National envelopes for rural development, 2014 -20 
(Current prices, EUR million)  
  2014  2015  2016  2017  2018  2019  2020  Total 
2014 -20 
Belgium  41 97 110 97 97 103 103 648 
Bulgaria  0 503 505 340 340 340 339 2,367 
Czech Republic  0 470 503 345 343 323 322 2,306 
                                                
83 European Commission, New legislation from 2021. Viewed at: https://ec.europa.eu/info/food -
farming -fisheries/farming/organic -farming/future -organics_en . 
84 I - Live and unprocessed agricultural products, animals, plants and seed, mushrooms; II - Processed 
food; and III -Feed. Annex I of Regulation (EU) 2018/84 8. 
85 EU specific support measures to organic farming are covered by other EU regulations. See notably 
EU Regulations 1305/201 3 (Arts. 16 and 29) and 702/2014 (Art. 20).  
86 Commission Delegated Regulation (EU) 2015/1366 of 11 May 2015 supplementing Regulati on (EU) 
No. 1308/2013 of the European Parliament and of the Council with regard to aid in the apiculture sector; 
Commission Implementing Regulation (EU) 2 015/1368  of 6 August 2015 laying down rules for the application 
of Regulation (EU) No. 1308/2013 of the European Parliament and of the Council with regard to aid in the 
apiculture sector and Commission Implementing Decision (EU) 2019/974 of 12 June 2019 ap proving the 
national programmes. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1574847836532&uri=CELEX:32019D0974 . 
87 Commission Delegate d Regulation (EU) No. 807/2014 of 11  March 2014 supplementing Regulation 
(EU) No.  1305/2013 of the European Parliament and of the Council on support for rural development by the 
European Agricultural Fund for Rural Development (EAFRD) and introducing trans itional provisions;and 
Commission Implementing Regulation (EU) No. 808/2014 of 17 July 2014 laying down rules for the application 
of Regulation (EU) No.  1305/2013 of the European Parliament and of the Council on support for rural 
development by the Europea n Agricultural Fund for Rural Development (EAFRD). Viewed at: https://eur -
lex.europa.eu/legal -content/en/ALL/?uri=CELEX%3A32014R0808 . 
88 European Commission, Rural develo pment 2014 -2020. Viewed at: 
https://ec.europa.eu/agriculture/rural -development -2014-2020_en . WT/TPR/S/395 • European Union  
 
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    2014  2015  2016  2017  2018  2019  2020  Total 
2014 -20 
Denmark  90 90 136 145 153 152 152 919 
Germany  665 1,498 1,686 1,404 1,401 1,398 1,395 9,446 
Estonia  104 104 111 123 126 127 129 823 
Ireland  0 470 470 313 313 313 313 2,191 
Greece  0 907 1,008 703 702 700 698 4,718 
Spain  0 1,780 1,780 1,186 1,184 1,183 1,183 8,297 
France  4 2,336 3,364 1,666 1,668 1,985 1,988 12,011 
Croatia  0 448 448 282 282 282 282 2,026 
Italy 0 2,223 2,232 1,493 1,496 1,499 1,502 10,444 
Cyprus  0 28 28 19 19 19 19 132 
Latvia  138 151 153 155 157 159 161 1,076 
Lithuania  230 230 230 230 230 247 264 1,664 
Luxembourg  0 21 21 14 14 14 15 101 
Hungary  0 743 737 489 488 487 487 3,431 
Malta  0 21 21 14 14 14 14 97 
Netherlands  87 87 118 118 118 148 148 825 
Austria  558 559 561 562 564 566 567 3,938 
Poland  1,570 1,176 1,193 1,192 1,191 1,189 1,187 8,698 
Portugal  577 578 579 580 581 582 582 4,058 
Romania  0 1,723 1,752 1,187 1,185 1,142 1,140 8,128 
Slovenia  119 119 119 120 120 120 121 838 
Slovak  
Republic  271 213 216 215 215 215 215 1,560 
Finland  335 337 338 340 342 343 345 2,380 
Sweden  0 387 378 249 250 250 250 1,764 
United 
Kingdom  476 848 851 755 754 755 756 5,195 
Technical 
assistance  34 34 34 34 34 34 34 239 
Total  5,299  18,184  18,684  14,371  14,381  14,691  14,709  100,318  
Source:  Annexe I (pp. 72 -73) of Regulation No. 1305/2013 of the European Parliament and of the Council of 
17 December 2013 on support for rural development by the European Agricultural Fund for Rural 
Development (EAFRD) and repealing Council Regulation (EC) No . 1698/2005 . Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:0201 3R1305 -20190301&from=EN . 
4.72.   Regulation (EU) No. 1305/2013 sets out common priorities for rural development, and each 
member State, or region in a member State, has drawn up a rural development programme based 
on at least four of these priorities. Each priorit y has a number of focus areas, and the rural 
development programmes include quantitative targets for each focus area ( Table 4. 10). The rural 
development programmes must implement a strategy to meet the priorities through a list of 
measures defined in Title  III of the Regulation.  
4.73.   There are 118 rural development programmes in the 28 member States, with 20 national 
programmes, and eight member States with two or more regional programmes. Each programme 
sets targets for the priorities, and at least 30% of fundi ng must be for measures relating to the 
environment and climate change, and 5% for the LEADER programme, which provides grants for a 
variety of community -led programmes under the sixth priority on social inclusion, poverty reduction 
and economic developmen t in rural areas.  
4.74.   The support for risk management , which constitutes one of the priorities (under 3.B – 
Table  4.10) identified by Regulation (EU) No. 1305/2013, can take different forms89: (i) financial 
contributions to insurance premiums against economic losses caused by adverse climatic events, 
animal or plant diseases, pest infestations, or environmental incidents; ( ii) financial contributions to 
mutual funds compensating for economic losses resulting from the same kind of events; and 
                                                
89 Art. 36, Regulation (EU) No. 1305/2013 of the European Parliament and of the Coun cil of 
17 December 2013 on support for rural development by the European Agricultural Fund for Rural Development 
(EAFRD) and repealing Council Regulation (EC) No.  1698/2005. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=celex%3A32013R1305 . WT/TPR/S/395 • European Union  
 
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  (iii) income stabilization tools in the form of financial contributions to mutual funds to compensate 
for severe drops in incomes.  
4.75.   The Omni bus Regulation brought several changes to the risk management  tools through: the 
creation of a sector -specific income stabilization tool, triggered by a drop of income threshold of 
20% (instead of 30% for the general income stabilization tool); the reducti on of the drop in 
production threshold for the financial contributions to insurance premiums from 30% to 20%; an 
increase of the EU support rate, from 65% to up to 70%, for all these risk management tools (support 
to insurance premiums, mutual funds in cas e of adverse events, and income stabilization tools).90 
4.76.   The Omnibus Regulation also introduced some changes in relation to selection and flexibility 
criteria of rural development plans, as well as to the way financial instruments can be adopted.91 
4.77.   According to the Commission, 45% of funds of all the rural development plans are for 
improving ecosystems, 20% for improving farm viability and competitiveness, and 10% for food 
chain organization, animal welfare and risk management ( Table 4.10).  
Table 4.10 Rural development priorities and focus areas  
 Priority  % of funds  
1 Knowledge transfer and innovation  3 
1.A Innovation, cooperation, and the development of the knowledge base   
1.B Links between agriculture, food production , forestry , research and innovation, 
including for the purpose of improved environmental management and performance   
1.C Learning and vocational training   
2 Farm viability and competitiveness, and promoting innovative farm 
technologies and sustainable management of forests  20 
2.A Improving the economic performance of all farms   
2.B Entry of adequately skilled farmers   
3 Food chain organization, including processing and marketing of agricultural 
products, animal welfare, and risk management  10 
3.A Improving competitiveness   
3.B Risk prevention and management   
4 Restoring, preserving and enhancing biodiversity  45 
4.A Biodiversity   
4.B Water management   
4.C Preventing soil erosion and improving soil management   
5 Resource efficiency , and supporting the shift towards a low -carbon and 
climate -resilient economy in the agriculture, food and forestry sectors  7 
5.A Efficiency in water use   
5.B Efficiency in energy use   
5.C Supply and use of renewable sources of energy   
5.D Reducing GHG and ammonia emissions   
5.E Carbon conservation and sequestration   
                                                
90 European Commission, Summary of main changes introduced to the four basic regulations of the CAP 
through the Omnibus regulation . Viewed at: https://ec.europa.eu/agriculture/cap -overview/summary -changes -
omnibus_en.pdf . 
91 European Commission, Summary of main changes introduced to the four basic regulations  of the CAP 
through the Omnibus regulation . WT/TPR/S/395 • European Union  
 
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   Priority  % of funds  
6 Social inclusion, poverty reduction and economic development  16 
6.A Diversification, creation and development of small enterprises   
6.B Local development   
6.C Accessibility, use and quality of ICT  
Note:  The figures may not total to 100% due to  technical assistance and discontinued measures . 
Source:  EU Commission ; Regulation (EU) No. 1305/2013 of the European Parliament and of the Council  of 
17 December  2013 on support for rural development by the European Agricultural Fund for Rural 
Development (EAFRD) and repealing Council Regulation (EC) No . 1698/2005 . Viewed at : 
https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=celex%3A32013R1305 ; and DG AGRI Rural 
development programmes 2014 -2020. Viewed at:  
https://ec.europa.eu/agriculture/sites/agriculture/files/rural -development -2014-2020/country -
files/common/rdp -list_en.pdf . 
4.1.1.2.2   Export subsidies  and export measures with equivalent effect  
4.78.   Following the elimination of sugar quotas in September 2017, the EU discontinued the 
notification of out -of-quota sugar exports , and the most recent notification , for the 2017/18 
marketing year , shows that no exp ort subsidies were provided in that year.92 Although Regulation  
(EU) No. 1308/2013 still provides for export refunds in exceptional situations, refund rates were set 
at zero in 2013 and have not changed.  
4.79.   On 6 October 2017, the EU circulated, as part of doc ument G/MA/TAR/RS/506 which is 
currently undergoing certification, its revised annual export subsidies commitment levels, pursuant 
to the December 2015 Nairobi Ministerial Conference Decision on export competition.93 
4.80.   While no export financing programmes for  agricultural products are operated at EU level, 
EU member States, with the exception of Belgium, Cyprus, Greece, Ireland, Italy, Luxemb ourg, 
Malta, Portugal and Spain, indicated the existence , at national level , of general programmes that 
may cover  agricu ltural products . The EU delivered around 24,000 tonnes of milk in the form of full 
grant, in -kind emergency food aid during the period June  2016-May 2018. The aid was part of the 
World Food Programme's existing activities.94  
4.1.1.2.3   Market access  
4.81.   During the period  under review, there was no substantial change with regard to market access 
for imports of agricultural products into the EU.  
4.82.   On average, EU b ound tariffs on agricultural products (WTO definition; simple average 
MFN tariff of 14.2% in 2019) remain higher than on non -agricultural products (simple average MFN 
tariff of 4.2% in 2019), and vary considerably from one agricultural product to another, with a 
standard deviation of 18.3 compared to 4.4 for non -agricultural products (Section 3.1.3). In addition, 
many agricultural products are subject to non -ad valorem  duties that can also vary from simple 
specific duties to more complex forms, such as those in the Meursing Table.95 However, imports of 
agricultural products from LDCs and from many developing countries can enter the EU at zero or 
reduced tariffs under the EBA initiative, its GSP and GSP+ schemes, and its network of trade 
agreements.  
                                                
92 WTO document G/AG/N/EU/51, 22 February 2019. This does not cover general schemes, which 
neither specifically cover nor specifically exclude agricultural products.  
93 WTO document G/AG/N/EU/51, 22 February 2019; and European Commission, EU leads the way by 
eliminating export subsidies ahead of WTO conference in Buenos Aires. Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1738 . 
94 WTO document G/AG/W/125/Rev.11, 19 September 2019.  
95 Regulation (EU) No. 510/2014 of the European Parliament and of the Council of 16 April 2014 laying 
down the trade arrangements applicable to certain goods resulting from the processing of agricultural  products 
and repealing Council Regulations (EC) No. 1216/2009 and (EC) No. 614/2009. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32014R0510 . WT/TPR/S/395 • European Union  
 
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  4.83.   Tariffs for some cereals may be adjusted, based on import prices. For high -quality common 
wheat, durum wheat (high -, medium - and low -quality), maize, flint maize, sorghum, and rye96, the 
duty is EUR 157.0497 minus the c.i.f. import price, with further adjustments depending on the 
product, port of unloading, quality, and other factors as set out in Commission Regulation (EU) 
No. 642/2010.98 On the basis of these calculations, the import duty that had been fixed at zero in 
November 201499 increased for rye, maize and sorghum from early August 2017 to early 
March  2018.100 
4.84.   In the case of husked rice, the level of import duty was modified  in early March 2019 for the 
first time since March 2012, following the importation of 265,000 tonnes of non -basmati rice during 
the first six months of marketing year 2017/18 that triggered an increase from EUR  30 up to 
EUR 65 per tonne.101 
4.85.   The entry price system applying to certain fruit and vegetables102 continues to be applied as 
set out in Commission Implementing Regulation (EU) 2017/892 of 13 March 2017 laying down rules 
for the application of Regulation (EU) No. 1308/2013 with regard to the fruit and veg etables and 
processed fruit and vegetables. The standard import values that used to be published through 
Commission implementation regulations are now made available via the TARIC.  
4.86.   Previously, the EU notified, in its two latest WTO notifications on import s under tariff and 
other quotas103, a total of 124 TRQs104, including 60 for marketing year 2017/18 and 64 for calendar 
year 2018. As reflected in the latest EU information on the administration of TRQs105, of the 
124 TRQs, 82 were erga omnes  and 42 had country -specific allocations. According to the 
Commission, and as enumerated in its notifications, the EU uses first -come first -served and licences 
to allocate agricultural TRQs.  
4.87.   Several Commission implementation regulations were adopted during the period under re view 
in relation to TRQs, notably as a result of Article XXIV.6 and Article XXVIII GATT negotiations . The 
EU Commission noted that it had  reflected these changes106 in the draft schedule in document 
G/MA/TAR/RS/506.107  
4.88.   Changes were also brought about, following the provisional application of the CETA between 
the EU and Canada108, including, in particular, changes to Commission Implementation Regulation 
                                                
96 CN codes 1001 11 00, 1001 19 00, ex 1001 91 20 (common wheat seed), ex 1001 99 00 
(high-quality common wheat other than for sowing), 1002 10 00, 1002 90 00, 1005 10 90, 1005 90 00, 1007 
10 90 and 1007 90 00.  
97 That is, the intervention price (EUR  101.31 per tonne) plus 55%.  
98 Commission Regulation (EU) No. 642/2010 of 20 July 2010 on rules of application (cereal sector 
import duties) for Council Regulation (EC) No. 1234/2007. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A3 2010R0642 , as notably amended by Commission Implementing Regulation 
(EU) 2017/1587 of 19 September 2017 amending Regulation (EU) No. 642/2010 on rules of application (cereal 
sector import duties) for Council Regulation (EC) No. 1234/2007. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32017R1587 , following the provisional application of CETA between the EU 
and Canada.  
99 Commission Implementing Regu lation (EU) No. 1206/2014 of 7 November 2014 fixing the import 
duties in the cereals sector applicable from 8 November 2014. Viewed at: https://eur -lex.europa.eu/legal -
content/GA/TXT/?uri=CELEX:32014R1206 . 
100 Commission Implementing Regulations (EU) 2017/1434, 2017/1517, 2017/1835 and 2018/316. 
Duties rose up to EUR  10,95 per tonne on 1 September 2017 and started decreasing on 10 October 2017.  
101 Commission Implementing Regulation (EU) 2019/371 of 7 March 2019 fixing the import duties 
applicable to certain type of husked rice from 8 March 2019. Viewed at: https://e ur-lex.europa.eu/legal -
content/GA/TXT/?uri=CELEX:32019R0371 . 
102 The products covered as listed in Annex VII of Implementing Regulation (EU) 2017/892 are: 
tomatoes; cucumbers; artichokes; courgettes; oranges; clementines; mandarins; lemons; table grapes; 
apples; pears; apricots; cherries, other than sour; peaches, including nectarines; and plums  
103 WTO documents G/AG/N/EU/48, 25 October 2018; and G/AG/N/EU/50, 15 February 2019.  
104 Corresponding to the number of TRQs contained in Section I -B of the draft EU -28 schedule circulated 
in WTO document G/MA/TAR/RS/506, 6 October 2017.  
105 WTO documents G/AG/N/EU/31, 2 September 2016; G/AG/N/EU/31/Corr.1, 13 January 2017; 
G/MA/TAR/RS/506; and information provided by the Commission.  
106 Commission Implementing Regulations (EU ) 2017/1085, 2017/1156, 2018/82, 2018/1232 and 
2019/675.  
107 As amended by document G/MA/TAR/RS/506/Add.2, 17 October 2018.  
108 Commission Implementing Regulations (EU) 2017/1585, 2017/1586 and 2017/1588.  WT/TPR/S/395 • European Union  
 
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  (EU) No.  481/2012109 in relation to the autonomous TRQ of high -quality beef, opened pursuant to 
Council Re gulation 617/2009 as amended by Regulation (EU) No. 464/2012 of the European 
Parliament and of the Council, following the memoranda of understanding signed in the context of 
WTO disputes DS26 and DS48 launched by the United States and Canada (case 
European  Communities – Measures Concerning Meat and Meat Products (Hormones) ).110 The EU and 
Canada notified a mutually -agreed solution for WTO dispute DS48 on 28 September 2017.111 
4.89.   The Council also adopted, on 15 July 2019112, a Decision on the signing of an agreement with 
the United States on the allocation of a share of 35,000 tonnes within this autonomous TRQ of 
high-quality beef, as resulting from the revised memorandum of understanding signed on 
21 October  2013.113 
4.90.   As a result of the agreement signed between the EU a nd China in relation to WTO dispute 
DS492 Measures affecting tariff concessions on certain poultry meat products114, Commission 
Regulation No. 616/2007, opening TRQs in the sector of poultry meat, was amended115, and a 
mutually -agreed solution was notified to the WTO.116 
4.91.   The Omnibus Regulation also provides for the Commission to make the results of the 
allocations of TRQs public through an appropriate web -publication.  
4.92.   Under the Agreement on Agriculture, the EU has the right to use the agricultural special 
safegua rd mechanism for certain agricultural products designated as such in its WTO schedule of 
commitments, as negotiated in the Uruguay Round. According to the notifications made to the 
Committee on Agriculture during the period under review, the EU invoked the  special safeguard for 
six tariff lines of poultry or egg products in the marketing years 2016/17 , 2017/18 , and 2018/19  
pursuant to the price -based special safeguard system (SSG). The EU noted that the volume -based 
SSG was not invoked in 2016/17 , 2017/ 18, and 2018/19,  although it wa s made operational on 
18 tariff lines (corresponding to 15 products) for fruit and vegetable  products. In these cases, the 
term "made operational" means that prices are monitored and the price -based SSG may be charged 
if the import price is below the trigger price or, for the volume -based SSG, import volumes are 
calculated.117 The trigger volumes f or the years 2018 and 2019 for the possible application of 
additional import duties on certain fruit and vegetables are fixed in Commission Implementing 
Regulation (EU) 2018/3 of 4 January 2018.  
4.1.1.3   Domestic support levels  
4.1.1.3.1   WTO notifications  
4.93.   The two last DS:1 n otifications from the EU for domestic support were for marketing years 
2015/16 and 2016/17, and include changes that resulted from the 2013 reform of the CAP 
(Chart  4.1).118 
                                                
109 Commission Implementing Regulation (EU) 2017/1585.  
110 WTO documents WT/DS26/28, 30 September 2009; WT/DS26/29, 17 April 2014; and WT/DS48/26, 
22 March 2011.  
111 WTO document WT/DS48/27, 3 October 2017.  
112 European Council, Imports of hormone -free beef: EU -US agreement confirmed. Viewed at: 
https://www.consilium.europa.eu/en/press/press -releases/2019/07/15/imports -of-hormone -free-beef-eu-us-
agreement -confirmed/ . 
113 WTO document WT/DS26/29, 17 April 2014.  
114 Council Decision (EU) 2018/1252, 28 January 2019.  
115 Commission Implementing Regulation (EU) 2019/398 of 8 March 2019 amending Regulation (EC) 
No. 616/2007 as regards some additional tariff quotas in the sector of poultrymeat an d derogating from that 
Regulation for the quota year 2018/2019. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32019R0398 . 
116 WTO document WT/DS49 2/9, 30 May 2019.  
117 WTO documents G/AG/N/EU/39, 4 October 2017; G/AG/N/EU/47, 30 October 2018; and 
G/AG/N/EU/56, 24 September 2019.  
118 WTO documents G/AG/N/EU/46, 23 August 2018 and corrigenda; and G/AG/N/EU/55, 1 April 2019.  WT/TPR/S/395 • European Union  
 
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  Chart 4.1 Domestic support, 2007/08 -2016/17  
(EUR million)  
 
Source:  WTO notifications.  
010,00020,00030,00040,00050,00060,00070,00080,0002007/08 2008/092009/102010/112011/122012/132013/142014/152015/162016/17de minimis total
 Current total AMS
 Blue Box
 Green Box
02,0004,0006,0008,00010,00012,00014,0002007/082008/092009/102010/112011/122012/132013/142014/152015/162016/17Others
Olive oil
Sugar
Dairy
Cereals
Fruit and vegetables
Beef
01,0002,0003,0004,0005,0006,0002007/082008/092009/102010/112011/122012/132013/142014/152015/162016/17 Other
Sheep and goats
Dairy
Beef
CropsChart 4.[domestic support] Domestic support in the EU 2007/08 -2016/17
010,00020,00030,00040,00050,00060,00070,00080,0002007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 Other
Decoupled income support and SAPS
Structural adjustment, environment 
and regional assistance
General servicesGreen, Blue and Amber Boxes 
(including de minimis) (EUR million)
Amber box 
(excluding de minimis)
Blue BoxGreen Box
Source: WTO notifications.WT/TPR/S/395 • European Union  
 
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  4.94.   The notified value of support shows a significant increase, by 50%, in Blue Box payments 
from marketing year 2014/2015 to 2015/16; they then remained stable from marketing 
year 2015/16 to 2016/17, reflecting the introduction of the voluntary coupled support scheme 
(Section  4.1.2.1.1 above), to replace the previous "Article 68" coupled support scheme.119  
4.95.   According to the EU, the increase in the amounts available for payments under the Blue Box 
was obt ained entirely by reducing the available amounts for decoupled direct payments in the 
2013 CAP reform.120 
4.1.1.3.2   OECD monitoring and evaluation of agricultural policies  
4.96.   Compared to the methodology used to calculate the level of support provided under the 
Amber, Blu e, and Green Boxes in the WTO, the OECD's annual monitoring and evaluation reports on 
support to agriculture in OECD countries use a different methodology to calculate the value of 
support which is expressed in a number of indicators, including: the Produc e Support Estimate (PSE) 
for gross transfers from consumers and tax payers to agricultural producers; the Total Support 
Estimate (TSE) for transfers to the agricultural sector in general; and the Single Commodity 
Transfers (SCTs) for transfers to specific commodities. As previously noted, the PSE represents the 
value of transfers to producers, unlike support under the Amber Box, Blue Box and Green Box, which 
measure compliance with WTO commitments. Therefore, the value of support as notified to the WTO 
is neither compatible nor comparable with the values calculated by the OECD.  
4.97.   Overall, the percentage PSE (that is, support as a percentage of gross farm receipts) 
confirmed, during the 2016 -18 period, its stabilization since 2010, at a level of around 20%, 
considerably below the levels of the 1990s. Market price support increased between 2016 and 2018, 
from EUR  16 billion to close to EUR 20 billion, essentially due to the beef and veal sector, for which 
the market price differential increased significantly ( Table 4.11) . 
Table 4.11 OECD indicators for support to agriculture, 2011 -18 
(EUR million - except producer NPC)   
2011  2012  2013  2014  2015  2016  2017  2018  
Total               
  
Value of 
production  364,601.49  376,186.24  386,582.89  386,582.89  376,374.27  366,314.20  389,276.12  393,092.18  
TSE 92,293.31  100,967.36  105,351.01  90,707.55  97,752.08  99,114.93  99,200.75  104,530.23  
PSE 79,102.50  87,623.92  92,240.27  79,005.95  85,573.33  88,151.64  88,376.04  93,471.69  
SCT 14,664.88  21,573.40  26,262.93  18,846.57  22,169.04  21,481.90  20,872.53  25,447.81  
MPS 10,409.48  17,611.73  22,332.30  14,666.04  17,091.68  16,000.84  15,513.37  19,893.31  
Producer 
NPC                 
Common wheat  
Value of 
production  26,727.20  30,291.40  30,033.52  28,020.71  27,188.62  20,742.70  23,106.88  23,188.72  
SCT 0.13 1,195.87  1,328.97  685.16  1,437.46  176.33  228.71  170.59  
MPS 0.00 1,195.86  1,328.97  685.16  1,437.46  176.33  228.71  170.59  
Producer 
NPC 1.00 1.04 1.04 1.02 1.05 1.01 1.01 1.01 
Refined sugar  
Value of 
production  3,684.80  3,833.66  3,620.64  3,975.63  2,994.72  3,166.27  3,408.77  2,167.22  
SCT 41.04  48.52  692.94  721.80  603.92  193.52  193.63  442.52  
MPS 0.00 0.00 636.33  699.46  411.62  0.00 0.00 248.62  
Producer 
NPC 1.00 1.00 1.22 1.22 1.16 1.00 1.00 1.13 
                                                
119 Art. 68, Council Regulation (EC) No. 73/2009 of 19 January 2009 establishing common rules for 
direct support schemes for farmers under the common agricultural pol icy and establishing certain support 
schemes for farmers, amending Regulations (EC) No.  1290/2005, (EC) No. 247/2006, (EC) No. 378/2007 and 
repealing Regulation (EC) No. 1782/2003. Viewed at: https://eur -lex.europa.eu/legal -
content/en/ALL/?uri=CELEX%3A32009R0073 . 
120 See EU's answer to the question, raised during the November 2018 Regular Committee on 
Agriculture (ID89038, available at: agims.wto.org).  WT/TPR/S/395 • European Union  
 
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2011  2012  2013  2014  2015  2016  2017  2018  
Milk 
Value of 
production  52,139.28  50,411.02  57,032.57  60,178.71  51,280.00  48,039.26  58,300.46  57,533.12  
SCT 625.44  661.04  691.56  935.82  2,241.41  1,621.12  1,372.54  1,370.87  
MPS -29.71  -58.81  -92.38  -44.57  814.37  134.24  -39.75  -9.70 
Producer 
NPC 1.01 1.01 1.01 1.01 1.03 1.01 1.01 1.01 
Beef and veal  
Value of 
production  26,586.66  28,666.26  28,288.18  28,000.60  29,432.55  2,685.15  27,994.90  28,508.60  
SCT 4,086.36  9,461.61  11,814.62  7,307.83  8,907.30  5,574.96  6,971.41  10,434.86  
MPS 2,481.73  7,939.13  10,338.65  5,874.00  7,059.52  3,725.47  5,123.75  8,561.79  
Producer 
NPC 1.10 1.39 1.58 1.27 1.32 1.17 1.23 1.43 
Pig meat  
Value of 
production  33,822.12  36,852.72  37,620.52  35,625.75  32,746.49  34,861.43  38,037.15  34,134.78  
SCT -53.03  -126.48  521.83  -107.64  -183.07  -127.85  -97.56  24.43  
MPS -76.34  -153.95  508.44  -116.10  -187.78  -146.18  -102.70  -25.40  
Producer 
NPC 1.00 1.00 1.02 1.00 1.00 1.00 1.00 1.00 
Poultry  
Value of 
production  14,990.37  15,777.56  16,237.06  16,470.03  16,757.26  16,758.37  17,231.01  18,035.46  
SCT 3,456.28  3,084.64  1,664.47  2,062.96  1,317.90  4,760.88  4,180.39  4,235.89  
MPS 3,436.74  3,058.87  1,658.06  2,057.05  1,317.90  4,731.91  4,163.39  4,199.15  
Producer 
NPC 1.30 1.25 1.12 1.15 1.10 1.40 1.32 1.31 
Sheep meat  
Value of 
production  4,829.09  4,680.86  4,580.85  4,567.07  4,621.69  4,512.73  4,597.60  5,051.48  
SCT 318.59  301.03  698.81  446.84  607.09  1,361.65  681.14  735.21  
MPS -6.91 -5.86 391.00  26.86  -10.55  637.74  6.72 53.31  
Producer 
NPC 1.00 1.00 1.10 1.01 1.00 1.17 1.00 1.01 
Source:  OECD , Getting the agricultural policy mix right . Viewed at: 
http://www.oecd.org/agriculture/topics/agricultural -policy -monitoring -and-evaluation/ . 
4.1.2   Fisheries  
4.1.2.1   Fisheries  
4.98.   The EU ranks among the top five fishing producer s in terms of production (3.2% of total world 
fisheries  in volume ) and trade ( 16.0% of total world fisheries  in value, excluding intra -EU-28).121 
Since the last Review, t he EU demand for fish products has continued to increase, resulting in it 
greatly exceeding its own supply and being the largest importer of fish and fish products in the 
world.122 The fisheries sector was, nonetheless , relatively small in terms of its contribution  to its 
economy (0.06% of total gross value added (GVA)). Its importance va ries from one member State 
to another, being most important in Greece (0.44% of GVA), Malta (0.31%), and Croatia (0.35%) 
during the period under review.123 
4.99.   The EU's total production of fisheries products (fish catch and aquaculture) in terms of volume 
was es timated to be about 6.3 million tonnes in 2016, which was still down on the corresponding 
                                                
121 WTO Secretariat cal culations based on Eurostat Statistics Explained , Fishery statistics . Viewed at: 
https://ec.europa.eu/eur ostat/statistics 
explained/index.php?title=Fishery_statistics#Total_fisheries_production_and_employment ; FAO Stat database. 
Viewed at: http://www.fao.org/fishery/statistics/global -production/en ; and FAO (2017). FAO yearbook. Fishery 
and Aquaculture Statistics 2017 . Viewed at: http://www.fao.org/fishery/statistics/yearbook/en .  
122 FAO (2017). FAO yearbook. Fishery and Aq uaculture Statistics 2017. Viewed at: 
http://www.fao.org/fishery/statistics/yearbook/en ; and EUMOFA, The EU Fish Market – 2018 Edition , pp. 23.  
123 Eurostat,  National Accounts (including GDP), (nama_10_a64) . Viewed at: 
https://ec.europa.eu/eurostat/web/national -accounts/data/database . Figures are based on 2015 -17 averages.  WT/TPR/S/395 • European Union  
 
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  level in 2000124 (Chart 4.2). The EU's total fish catch was estimated at 5 million tonnes in 2016, 
which accounted for about 80% of total EU fisheries production. Despi te the long -term downward 
trend in capture production in terms of volume, according to a 2018 Eurostat report, recent figures 
for fish catches showed a nearly 6% increase from 2016 to 2017.125 Aquaculture production was 
small relative to capture, with total production of 1.3 million tonnes (20% of total EU fisheries 
production), valued at EUR  4.3 billion in 2016.126 Main producers include Spain, the United Kingdom, 
Denmark, France, and the Netherlands.  
4.1.2.2   Trade performance127 
4.100.   The EU has continued to be highly depen dent on imports for fish and fish products since the 
last Review. This led to a record high trade deficit of EUR 20.9 billion, with imports of EUR  26.4 billion 
and exports of EUR 5.5 billion in 2018 (Chart 4.2). The deficit increase was mainly due to the g rowing 
value of frozen and fresh products, and prepared/preserved products. Fish products imported into 
the EU expanded more rapidly in value than in volume terms (5.1% per year in value from 2015 to 
2018, compared to 1.9% in volume), primarily due to risi ng prices (e.g.  the import price for salmon 
increased from EUR 5.22/kg in 2015 to EUR 6.63/kg in 2018) (Chart  4.2). Among EU members, 
most of the member States had trade deficits (including intra -EU trade): Italy had the largest trade 
deficit, of EUR 5.3 b illion, in 2018, followed by France (EUR  4.4 billion). Trade in fish and fish 
products, however, remains relatively small: 1.3% of total extra -EU-28 imports and 0.3% of exports 
in 2018.  
4.101.   Norway remained the leading supplier of fish and fish products for ext ra-EU-28 imports, 
accounting for 26% of total extra -EU imports, followed by China (7%), Morocco, and Ecuador (5% 
each)  in 2018. Main imported products (over EUR 1 billion) included salmon, cod, shrimp, skipjack 
tuna, and octopus, representing about 58% of total extra -EU-28 imports in 2018. According to a 
2018 European Market Observatory for Fisheries and Aquaculture Products (EUMOFA) report, 
Ecuadorian fish products (mainly skipjack) benefitted from duty -free entry under the EU -Ecuador 
FTA, effective from J anuary 2017; this contributed to an increased import value and volume from 
Ecuador.128 The top three EU destinations for extra -EU imports were Spain, Sweden, and Denmark, 
which accounted for over 45% of total extra -EU-28-imports in 2018.129  
4.102.   Extra-EU exports i ncreased to EUR 5.5 billion in 2018, up from EUR 4.8 billion in 2015, with 
a growth rate of 4.7% per year. In 2018, the United States was the largest destination market for 
EU exports (14.0% of total extra -EU-28 exports), followed by China (13.2%), Switzer land (8.6%), 
and Norway (8.4%). With regard to species, salmon accounted for the largest share (16.7%) of 
extra-EU-28 exports in 2018.  
                                                
124 Eurostat Statistics Exp lained, Fishery statistics . Viewed at: https://ec.europa.eu/eurostat/statistics -
explained/index.php?title=F ishery_statistics#Total_fisheries_production_and_employment .  
125 Eurostat (2018). Agriculture, forestry, and fishery statistics, 2018 Edition , pp. 117. Viewed at: 
https://ec.europa.eu/eurostat/web/products -statistical -books/ -/KS-FK-18-001.  
126 Information provided by the authorities.  
127 For data analysis, fish and fish products are based on HS 03, HS 0508, HS 051191, HS 150410, 
HS 150420, HS 1603 -05, and HS 230120. Also, EUMOFA's correlation table " Annex 4  Correlation between Main 
commercial species/Commodity Groups and CN -8 from 2001 to  2019" is applied. Viewed at: 
https://www.eumofa.eu/supply -balance -and-other -methodologies . 
128 EUMOFA, The EU Fish Market – 2018 Edition , pp. 55.  
129 Eurostat. Viewed at: https://ec.europa.eu/eurostat/data/database . WT/TPR/S/395 • European Union  
 
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  Chart 4.2 Production and trade of  fish and fishery products  
 
Source:  Eurostat, International trade in goods . Viewed at: https://ec.europa.eu/eurostat/web/international -
trade -in-goods/data/database ; EUMOFA, the EUMOFA databas e. Viewed at: 
http://www.eumofa.eu/web/eumofa/data ; and Eurostat Statistics Explained, Fishery statistic s. 
Viewed at:  
https://ec.europa.eu/eurostat/statisticsexplained/index.php?title=Fishery_statistics#Total_fisheries_
production_and_employment . 
4.1.2.3   Law, regulations, and polices  
4.103.   Article 3 of the TFEU stipulates th at the EU has exclusive competence for the conservation 
of marine biological resources under the Common Fisheries Policy (CFP) and for the conclusion of 
international agreements. Article 4 of the TFEU stipulates that other fisheries policy areas including 
responsibility for the implementation of EU rules and for registration of vessels falling under shared 
competence between the EU and the member States.  
4.104.   The CFP provides a set of rules for managing European fishing fleets and for conserving fish 
stocks. Th e reformed CFP130, effective from 1 January 2014, ensures that fishing and aquaculture 
activities are environmentally, economically and socially sustainable in the long term, and that they 
are managed under an ecosystem approach.131 The fisheries regime is bas ed on three main 
                                                
130 Since its introduction in 1970, the CFP has been reformed several times (e.g. the 1983 regulation, 
the 1992 regulation, and the 2002 reform), most recently in 2014.  
131 European Parliament and the Council Regulation (EU) No. 1380/2013, Article 2.  
01,0002,0003,0004,0005,0006,0007,0008,0009,00020002001200220032004200520062007200820092010201120122013201420152016Aquaculture Catches('000 tonnes of live weight )Chart 4. [Fish] Fisheries and aquaculture prodcution
Source:Production
0.01.02.03.04.05.06.07.08.09.0
2013 2014 2015 2016 2017 2018Prices of major extra -EU imported species 
Eurostat database. Viewed at: https://ec.europa.eu/eurostat/data/database; and EUMOFA database. Viewed at: 
https://www.eumofa.eu/data.  (EUR/kg)
Salmon Skipjack 
tunaMis-
cellaneous 
shrimpWarmwater 
shrimpsCod15171921232527
01,0002,0003,0004,0005,0006,0007,000
2013 2014 2015 2016 2017 2018Volume Value('000 tonne ) (EUR billion )
Imports 
-30.0-25.0-20.0-15.0-10.0-5.00.05.010.0
2013 2014 2015 2016 2017 2018
Fresh/live - boiled/cooked Frozen
Prepared-preserved Dried-salted-smoked
Unspecified Trade balance(EUR billion)
Trade balance
Exports
ImportsWT/TPR/S/395 • European Union  
 
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  regulations: the basic regulation on the CFP (Regulation (EU) No. 1380/2013 of the 
European  Parliament and the Council); the common organization of the markets in fishery and 
aquaculture products (Regulation (EU) No. 1379/2013 of the Europ ean Parliament and the Council); 
and the European Maritime and Fisheries Fund (Regulation (EU) No. 508/2014 of the 
European  Parliament and the Council).  
4.105.   Since the last Review , there have been no significant changes  with respect to fisheries 
management unde r the CFP . However, in the sixth year of the implementation of the CFP, which set 
the objective of restoring and maintaining fish stocks at sustainable levels by 2020, the EU has been 
carrying out an overall assessment of the implementation of the CFP thro ugh the European 
Commission's report on the status of play on the CFP132 as well as a public consultation for preparing 
proposals on fishing opportunities .133 Also, as part of managing fisheries, the Commission recently 
adopted the regulation on technical meas ures (in force since 14 August 2019)134 and put forward a 
proposal to revise the existing regulation on the fisheries control system135 in order to ensure their 
compliance with the reformed CFP.  
4.106.   The CFP covers several instruments managing fisheries. Under it, the multi -annual recovery 
and management plans continue to play an important role in managing almost all important stocks 
and fisheries, with clear objectives and rules at the core of the conservation policy. As at 
August  2019, five  new-generation  plans136 were in force (e.g. over -fished species such as cod, 
herring and sprat in the Baltic Sea).137 These plans contain, inter alia , the goal for fish stock 
management (in terms of fishing mortality and/or targeted stock size); the target of fishing at 
maximum sustainable yield and a deadline for achieving this target; the implementation of the 
landing obligation; safeguards for remedial action where needed; review clauses; and technical 
measures (Table 4 .12). Since 1 January 2019, the landing obligation  has fully applied to all catches 
of regulated species (i.e. catch limits and minimum fishing size)138; fish caught are required to be 
landed, and discarding is not allowed anymore, with some exceptions such as de minimis and species 
with high survival rates .139  
4.107.   The EU has demonstrated its fishing effort management, which is an essential part of 
ensuring sustainable fishing, one of the main objectives of the CFP. Fleet capacity continued to 
decline, in number, capacity and power; the number of vessels decrease d from some 84,000 in 2015 
to 82,000 in 2017.140 However, in 2017, the fleet  showed a net profit of EUR 1.3 billion, mainly as a 
result of low fuel prices, higher average prices of several species, increased landings, improved 
stocks , and technological advan ces.141 The total capacity of the fleet may not be increased; the 
                                                
132 European Commission , Communication on the State of Play of the Common Fisheries Policy and 
Consultation on the Fishing Opportunitie s for 2020 . Viewed at: 
https://ec.europa.eu/transparency/regdoc/rep/1/2019/EN/COM -2019-274-F1-EN-MAIN -PART-1.PDF ; and 
Commission Staff Working Documen t. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52019SC0205&from=EN .  
133 European Union, Sustainable fisheries: Commission presents  progress made and opportunities for 
2020. Viewed at: https://ec.europa.eu/fisheries/press/sustainable -fisheries -commissi on-presents -progress -
made -and-opportunities -2020_en . 
134 Regulation (EU) 2019/1241 of the European Parliament and of the Council, 20 June 2019. Viewed at: 
https://eur -lex.eu ropa.eu/legal -content/EN/TXT/?uri=CELEX:32019R1241 . 
135 European Commission, The EU's fisheries control system . Viewed at: 
https://ec.europa.eu/fisheries/cfp/control_en .  
136 The fisheries agreement s after the reform of the CFP in 2013. They include special provisions on 
human rights, and the rule that sectoral support is decoupled from payments for access to fisheries resources.  
137 European Commission, Multi-Annual Plans . Viewed at: 
https://ec.europa.eu/fisheries/cfp/fishing_rules/multi_annual_plans_en . 
138 European Commission, Communication on the State of Play of the Common Fisheries Policy and 
Consul tation on the Fishing Opportunities for 2020 . Viewed at: 
https://ec.europa.eu/transparency/regdoc/rep/1/2019/EN/COM -2019-274-F1-EN-MAIN -PART-1.PDF . 
139 European Commission, Discarding and the landing obligation . Viewed at: 
https://ec.europa.eu/fisheries/cfp/fishing_rules/discards_en#Landing%20obligation . 
140 Eurostat , Fishing fleet by age, length and gross tonnage (fish_fleet_alt) . Viewed at: 
https://ec.europa.eu/eurostat/web/fisheries/data/database .  
141 STECF, JRC Science for Policy R eport, The 2019 Annual Economic Report on the EU Fishing Fleet 
(STECF 19 -06). Viewed at: https://stecf.jrc.ec.europa.eu/documents/43805/2483556/STECF+19 -06+-+AER+-
+2019.pdf .  WT/TPR/S/395 • European Union  
 
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  member States are required to comply with a fleet entry/exit scheme without introducing additional 
fishing capacity.142  
Table 4.12 Main fisheries management principles/instruments  
 Functions  
The Total Allowable 
Catches (TACs)  TACs are catch limits (i.e. the amount of each species to be caught) for most 
commercial fish stocks  in EU waters (there are only  a few TACs in the Mediterranean 
Sea). TACs are shared between EU members in the form of national quotas , and are 
fixed on an annual or bi -annual basis (for deep -sea stocks) on the basis of scientific 
advice on the stock status from advisory bodies  such as the International Council for 
the Exploration of the Sea (ICES) and the Scientific, Technical and Econom ic 
Committee for Fisheries (STECF) . For stocks that are shared or jointly managed with 
non-EU member States, the TACs are agreed with those non -EU member States. EU 
member States can exchange quotas with other EU member States. Each member 
State is respons ible for ensuring that the quotas are not over -fished.  
The maximum 
sustainable yield 
(MSY)  The MSY approach aims at restoring and maintaining fish stocks at levels that allow 
fishermen to catch a maximum proportion of a fish stock without leading to a 
long-term depletion and a reduction in overall yield. An effective MSY approach can 
be implemented using fishery management instruments such as multi -annual plans 
and TACs. Under the reformed CFP, member States agreed to set the objective of 
reaching MSY for all stocks by 2020 . 
Discarding/landing  
obligation  All commercial species must be landed and counted against quota, except when 
subject to some exemptions. The obligation applies to all species under TACs in 
EU waters and for European vessels fishing in the high seas or, in the Mediterranean, 
for species under minimum landing sizes. The use of landed undersized fish is 
restricted to non -direct human consumption only.  
Regionali zation The reformed CFP has shifted to more decentralized governance  by having a 
decision -making process at national and regional level. In this regard, the member 
States with a direct management interest may agree to submit joint 
recommendations for achieving the CFP conservation objectives. The 
recommendations must be ba sed on scientific advice and be compatible with relevant 
conservation measures and/or multi -annual plans. The EU member States must 
consult the relevant Advisory Councils on the joint recommendation before submitting 
them to the European Commission. If all these conditions are met, the Commission 
can then adopt a Commission Act to transform these joint recommendations into EU 
law applicable to all operators . 
Fishing effort  The member States are required to adjust their fishing capacities to bring them into  
line with fishing opportunities. An annual report on the balance between the fishing 
capacity of their fleet and the fishing opportunities must be submitted. When 
imbalances are identified, action plans should be incorporated into the report, to be 
submit ted to the Commission by 31 March each year. These reports are made 
publicly available.  
Access to water  As a general rule, registered fishing vessels have equal access to all EU waters and 
resources managed under the CFP. A fishing licence is required.  
Technical measures  Technical measures are a broad set of rules which govern how, where and when 
fishermen may fish. These may include , inter alia , specification s for the design and 
use of gears, mesh sizes for nets, and closed areas and seasons . The fram ework was 
recently reformed, with the entry into force of the new Technical Measures Regulation 
(Regulation 2019/1241).  
                                                
142 Regulation (EU) No. 1380/2013 of the European Parliament and of the Council of 11 December 2013 
on the Common Fisheries Policy, amending Council Regulations (EC) No. 1954/2003 and (EC) No. 1224/2009 
and repealing Council Regulations (EC) No. 2371/2002 and  (EC) No. 639/2004 and Council Decision 
2004/585/EC, Article 23. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32013R1380&from=EN . In accordance of with Article  23 (3), the 
European  Commission carried out an evaluation of the implementation of the entry/exist scheme for EU vessels 
on 25 July 2019. Viewed at: https://ec.europa.eu/fisheries/sites/fisheries/files/docs/body/swd -2019-
312_en.pdf .  WT/TPR/S/395 • European Union  
 
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   Functions  
Fisheries control 
system  The Control Regulation (Council Regulation (EC) No. 1224/2009) provides for control, 
inspection and enforcement to ensure compliance with the rules of the CFP. The EU 
CFP control system is supported by the implementation of sustainable management 
of external fishing fleet (SMEFF)  and illegal, unreported, a nd unregulated (IUU)  
Regulations. The system is designed  to, inter alia , ensur e that only the allowed 
quantities of fish are caught, and illegal fishing is prevented; allow data collection to 
manage fishing opportunities; and ensur e that rules and sanctions are uniformly 
applied across the EU. The Regulation is currently under revisi on in order to ensure 
its compliance with the reformed CFP.  
Source:  Information compiled by the WTO Secretariat from EU online information; and WTO document 
WT/TPR/S/357/Rev.1, 13 October 2017 . 
4.108.   Aquaculture is a key component of both the CFP  and the Blue Growth strategy .143 The CFP 
Regulation (Article 34) sets the objective of the sustainable development of the EU aquaculture 
sector. As indicated in the Regulation, the European Commission adopted, in 2013, non -binding 
Strategic Guidelines for the sustainable  development of EU aquaculture144, setting common priorities 
and targets to unlock the potential of the sector. As also required by the CFP Regulation, EU member 
States adopted multi -annual national strategic plans (MNAPs), for the development of sustainable  
aquaculture on the basis of the Commission Guidelines.145 The Commission facilitates exchanges of 
best practices among EU member States regarding the implementation of their MNAPs in the context 
of the Open Method of Coordination for aquaculture.146 
4.109.   With resp ect to the Common Organisation of the Markets of Fishery and Aquaculture 
Products (CMO) , which is an integral part of the CFP, there have been no significant changes since 
the last TPR report147, except for an expiry of storage aid (i.e. support for fishery producer 
organizations to store their products) on 1 January 2019. The CMO regulation148 helps producers in 
the sector to guarantee sustainable fisheries and to strengthen the competitiveness of the EU fishery 
and aquaculture sector through, inter alia , prod uction and marketing plans, consumer information 
requirements, and market intelligence (i.e. EUMOFA for market transparency and efficiency).  
4.1.2.4   Market access and import requirements  
4.110.   Tariffs on fishery products remain high, with an average MFN rate of 11.8% as  compared to 
the overall average of 6.3% in 2019 (Section 3.1.3). All customs  duties are expressed as ad valorem  
rates, with a range of 0% -26%.  Some fishery products (i.e. 9 tariff codes at the 8 -digit level) are 
subject to seasonal rates (e.g. CN code 030 24400 – Mackerel149). Despite relatively high tariff 
protection on an MFN basis, the EU grants preferences (at zero or reduced duties), on a reciprocal 
or unilateral basis, to major fishery suppliers for extra -EU-28 imports (Table 4.13). For instance, 
duty-free treatment applies to all fishery imports from EU's major suppliers, such as Ecuador. 
According to EU statistics , in 2018, more than 50% of EU -28 fishery imports benefitted from FTAs 
                                                
143 The Blue Growth Strategy, adopted by the European Commission in 2012, is a long -term strategy to 
support sustainable growth in the marine and mariti me sectors. The following sectors are considered as priority 
sectors on the basis of their potential for creating new jobs and fostering innovation: aquaculture, coastal 
tourism, marine biotechnology, ocean energy, and seabed mining with an emphasis on cre ating new jobs and 
fostering innovation. European Commission, Blue Growth . Viewed at: 
https://ec.europa.eu/maritimeaffairs/policy/blue_growth_en . 
144 European Commission, Strategic Gu idelines for the sustainable development of EU aquaculture . 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52013DC0229&from=EN . 
145 European Commission. Multiannual national plans, Aquaculture . Viewed at: 
https://ec.europa.eu/fisheries/cfp/aquaculture/multiannual -national -plans . 
146 Article 34 (5) of Regulation (EU) No. 1380/2013 of the European  Parliament and the Council  of 
11 December 2013 on the Common Fisheries Policy, amending Council Regulations (EC) No. 1954/2003 and 
(EC) No. 1224/2009 and repealing Council Regulations (EC) No. 2371/2002 and (EC ) No. 639/2004 and 
Council Decision 2004/585/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32013R1380&from=EN ; and European Comm ission, Multiannual national 
plans, Aquaculture.  Viewed at: https://ec.europa.eu/fisheries/cfp/aquaculture/multiannual -national -plans_en .  
147 WTO document WT/TPR/S/357/Rev.1, 13 October 2017.  
148 Regulation (EU) No. 1379/2013 of 11 December 2013 on the common organisation of the markets in 
fishery and aquaculture prod ucts, amending Council Regulations (EC) No. 1184/2006 and (EC) No. 1224/2009 
and repealing Council Regulation (EC) No. 104/2000. Viewed at: https://eur -lex.eur opa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32013R1379&from=EN .  
149 From 1 January to 14 February and from 16 June to 31 December, the applied MFN rate is 20%; and 
from 15 February to 15 June, it is duty -free.  WT/TPR/S/395 • European Union  
 
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  and unilateral tariff arrangements (EUR 14 billion in 2018, up from EUR 10 billion in 2015).150 
Furthermore, the EU's  trade policy instruments for fishery products include WTO tariff quotas and 
autonomous tariff quotas (ATQs)151 (Section 3.1.3.3).  ATQs apply to certain fish and fish products, 
to increase the supply of raw  materials which are insufficiently produced to meet the demand in the 
EU for the processing industry .  
4.111.   Imports of fishery products and shellfish (bivalve molluscs) into the EU  are, in principle, 
subject to the EU food law, which forms the basis for EU imp ort rules ( Section 3.3.3 ). As a general 
rule, fishery products are imported into the EU from only approved countries152 and from approved 
establishments (e.g. processing plants).153 Imports must be accompanied by sanitary 
documentations (e.g. a health certific ate issued by the competent authority of the non -EU country 
that confirms that fishery products meet the standards for export to the EU).154 Also, catch 
certificates validated by flag States are required for most fishery products from non -EU countries, 
proving that fishery products from non -EU countries come from legal sources (i.e. not from illegal 
fishing).155 In May 2019, the European Commission launched CATCH (an IT system), aiming to 
digitalize the currently paper -based EU catch certification scheme.156 Moreover, the EU sets various 
requirements for a wide range of issues, including traceability and labelling, hygiene -related 
regulations, and packaging and storage.  
Table 4.13 Average applied tariffs for major spe cies by selected tariff regimes, 2019  
 MFN Chile  Peru  Iceland  Norway  Canada  GSP GSP+  
Alaska pollock  10.9 0.0 0.0 2.2 2.5 0.0 7.1 0.0 
Anchovy  16.7 0.0 0.0 5.0 5.0 0.0 13.2 0.0 
Cod 12.2 0.0 0.0 0.7 1.1 0.4 8.0 0.0 
Cuttlefish  7.6 0.0 0.0 2.3 2.3 1.6 2.7 0.0 
Fish oil  3.6 0.0 0.0 0.0 3.6 0.0 2.5 0.0 
Fishmeal  0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 
Hake 12.7 3.1 0.0 3.0 3.5 0.0 8.6 0.0 
Herring  14.9 0.0 0.0 9.0 11.6 0.0 11.4 0.0 
Lobster Homarus spp  9.4 0.0 0.0 2.8 2.8 3.4 3.3 0.0 
Mackerel  18.8 0.0 0.0 15.4 16.1 0.0 13.3 0.0 
Octopus  11.0 0.0 0.0 1.8 3.3 4.5 3.9 0.0 
Salmon  5.1 1.6 0.0 5.1 5.1 0.0 2.2 0.0 
Sardine  16.8 0.0 0.0 5.0 5.0 0.0 13.3 0.0 
Scallop  10.4 0.0 0.0 3.0 4.2 3.6 3.6 0.0 
Shrimp, miscellaneous  16.0 0.0 0.0 6.0 9.8 6.2 5.6 0.6 
Shrimp, warmwater  12.0 0.0 0.0 12.0 12.0 0.0 4.2 3.6 
Squid  6.6 0.0 0.0 2.0 2.0 1.5 2.9 0.0 
                                                
150 Eurostat, International trade in goods . Viewe d at: https://ec.europa.eu/eurostat/web/international -
trade -in-goods/data/database .  
151 Council Regulation (EU) 2018/1977 of 11 December 2018 opening and providing for the 
management of autonomous Union tariff quotas for certain fishery products for the period 2019 –20. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN /TXT/PDF/?uri=CELEX:32018R1977&from=EN ; and Commission 
Implementing Regulation (EU) 2018/1602 of 11 October 2018 amending Annex I to Council Regulation (EEC) 
No. 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff. Viewed at : 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32018R1602&from=EN .  
152 Commission Decision 2006/766/EC of 6 November 2006 establishing the list s of third countries and 
territories from which imports of bivalve molluscs, echinoderms, tunicates, marine gastropods and fishery 
products are permitted. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2006:320:0053:0057:EN:PDF . 
153 European Commission, Non-EU Countries Authorised Establishments . Viewed at: 
https://ec.europa.eu/food/safety/international_affairs/trade/non -eu-countries_en . 
154 European Commission, EU import conditions for seafood and other fishery products . Viewed at: 
https://ec.europa.eu/food/sites/food/files/safety/docs/ia_trade_import -cond-fish_en.pdf . 
155 Council Regulation (EC) No. 1005/2008 of 29 September 2008 establishing a Community system to 
prevent, deter and eliminate illegal, unreported and unregulated fishing, amending Regulations (EEC) 
No. 2847/93, (EC) No. 1936/2001 and (EC) No. 601/2004 and repealing Regulations (EC) No. 1093/94 and 
(EC) No. 1447/1999 . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32008R1005&from=EN ; and Commission Regulation (EC) No. 1010/2009 of 
22 October 2009 laying down detailed rules for the implementation of Co uncil Regulation (EC) No. 1005/2008 
establishing a Community system to prevent, deter and eliminate illegal, unreported and unregulated fishing. 
Viewed at: https://eur -lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:280:0005:0041:EN:PDF .  
156 European Commission CATCH - Information Note . Viewed at: 
https://ec.europa.eu/fisheries/sites/fisheries/files/docs/body/catch -it-system_en.pdf .  WT/TPR/S/395 • European Union  
 
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   MFN Chile  Peru  Iceland  Norway  Canada  GSP GSP+  
Tuna, miscellaneous  15.6 5.3 1.0 4.2 4.7 3.3 12.9 0.0 
Tuna, skipjack  16.6 8.8 0.0 5.0 5.0 6.4 14.1 0.0 
Tuna, yellowfin  16.6 8.8 0.0 5.0 5.0 6.4 14.1 0.0 
Note:  Calculations for averages are based on the 8 -digit tariff line level, excluding in -quota rates.  
 Duty-free treatment applies to all fishery imports from Ecuador, Morocco and Everything But Arms 
(EBA) beneficiaries.  
Source:  WTO Secretariat calculation s based on  the WTO Integrated Data Base (IDB ) database and Eurosta t. 
4.1.2.5   External policy  
4.112.   While nearly 80% of all EU catches take place in EU waters, the remaining catches come 
from the international high seas and waters of non -EU countries.157 EU fishing activities outside 
EU waters are based on the same principles as fishing within the EU. In December 2017, the EU 
introduced a new regulation on  the sustainable management of external fishing fleets (SMEFF 
Regulation) , which provides a new system of issuing  and managing authorizations for EU vessels 
fishing outside EU  waters, in order to improve monitoring and transparency of EU vessels.158 All 
EU vessels outside EU waters under the management of Regional Fisheries Management 
Organizations (RFMOs) and bilatera l fisheries agreements, and in high seas not under RFMOs, must 
be authorized by a flag member State.  
4.113.   The EU is party to several international agreements on fisheries, and has engaged in joint 
management of fisheries resources with non -EU countries. EU fis hing in high seas is regulated 
through two types of RFMOs, in which the EU has actively continued to participate: for 
highly -migratory fish stocks (6 tuna RFMOs) and for other fish stocks (11 non -tuna RFMOs).159 Also, 
the EU is an active participant in multi lateral negotiations on the law of the sea and the international 
fisheries law under the United Nations Conventions on the Law of the Sea (UNCLOS), and other 
international agreements and conventions under the FAO.  
4.114.   The EU continues to cooperate with interna tional partners to fight illegal, unreported, and 
unregulated (IUU) fishing worldwide, pursuant to the EU regulation on IUU.160 During the review 
period, the EU signed an agreement on ocean partnerships with China (on 16 July 2018)161 and 
Canada (on 18 July 20 19)162 for better international governance of the oceans, including the fight 
against IUU fisheries and the conservation and sustainable use of marine resources in the high seas. 
Besides IUU fishing, on 3 October 2018, the EU and nine other countries signed an Agreement to 
Prevent Unregulated Commercial Fishing on the High Seas in the Central Arctic Ocean.163 The 
Agreement prohibits commercial fishing in the high seas of the Central Arctic Ocean for at least 
16 years. As part of the Agreement, there will be a j oint scientific research and monitoring 
programme .164 
                                                
157 Publications Office of the European Union, EU sustainable fisheries partnership agreements. Viewed 
at: https://publications.europa.eu/en/publication -detail/ -/publication/c8b5d962 -0d38-11e7-8a35-
01aa75ed71a1/language -en/format -PDF/source -37907030 . 
158 Regulation (EU) 201 7/2403 of 12 December 2017 on the sustainable management of external fishing 
fleets, and repealing Council Regulation (EC) No. 1006/2008. Viewed at: https://eu r-lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017R2403&from=EN .  
159 European Commission, Regional fisheries management organisations (RFMOs) . Viewed at: 
https://ec.europa.eu/fishe ries/cfp/international/rfmo . 
160 Council Regulation (EC) No.  1005/2008 of 29 September 2008 establishing a Community system to 
prevent, deter and eliminate illegal, unreported and unregulated fishing, amending Regulations (EEC) 
No. 2847/93, (EC) No. 1936/200 1 and (EC) No. 601/2004 and repealing Regulations (EC) No. 1093/94 and 
(EC) No. 1447/1999. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=C ELEX:32008R1005&from=EN . 
161 European Commission, EU and China sign landmark partnership on oceans . Viewed at: 
https://ec.europa.eu/maritimeaffairs/content/eu -and-china -sign-landmark -partnership -oceans_en . 
162 European Commission, EU and Canada conclude ocean p artnership agreement . Viewed at: 
https://ec.europa.eu/fisheries/press/eu -and-canada -conclude -ocean -partnership -agreement_en .  
163 European Commission, EU and Arctic partners enter historic agreement to prevent unregulated 
fishing in high seas – Frequently Asked Questions . Viewed at: https://ec.europa.eu/fisheries/eu -and-arctic -
partners -enter -historic -agreement -prevent -unregulated -fishing -high-seas-%E2%80%93 -frequently_en . 
164 European Commission, EU and Arctic partners enter historic agreement to preven t unregulated 
fishing in high seas – Frequently Asked Questions . Viewed at: https://ec.europa.eu/fi sheries/eu -and-arctic -
partners -enter -historic -agreement -prevent -unregulated -fishing -high-seas-%E2%80%93 -frequently_en . WT/TPR/S/395 • European Union  
 
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  4.115.   Regarding arrangements with non -EU countries, the EU has two types of fishing agreements 
with Norway, Iceland, the Faroe Islands under Northern Agreements; and the Sustainable Fisheries 
Partnership Agreem ents (SFPAs), in which the EU provides financial and technical support in 
exchange for fishing rights, mainly with developing countries. Each SFPA protocol specifies fishing 
opportunities, amounts and methods of payments, and sectoral support.  
4.116.   SFPAs are re stricted to agreed target species under tuna agreements and multi -species 
agreements . As at October 2019, 12 SFPAs were in force between the EU and the partner countries 
(Table 4.14). In exchange for access rights to the Exclusive Economic Zone (EEZ), the EU provides 
these partners with a financial contribution for sectoral support for, inter alia , small -scale fisheries, 
science and research, institutional capacities, and reinforcement of monitoring and control 
capacities. SFPAs contribute to fighting and eradicating IUU by providing these partners with various 
tools such as capacity building and mon itoring and control of surveillance actions by the Vessel 
Monitoring System (VMS).165 There are also seven  dormant agreements,  such as with Gabon, Kiribati 
and Madagascar which adopted a fisheries partnership agreement without having a protocol in force . 
EU vessels are not allowed to fish under the regime of the dormant agreements.  
Table 4.14 List of fisheries agreements  
Country  Expiration date  
Tuna: EU vessels are allowed to catch migrating tuna stocks off the shores of Africa and through 
the Indian Ocean  
Cabo Verde  5 years ( 20.05. 2019-19.05.2024)  
Cook Islands   4 years (14.10.2016 -13.10.2020)  
Côte d'Ivoire   6 years (1.8.2018 -31.7.2024)  
The Gambia  6 years ( 31.07.2019-30.07.2025)  
Liberia  5 years (9.12.2015 –8.12.2020)  
Mauritius  4 years (08.12.2017 -07.12.2021 ) 
Seychelles  6 years (18.1.2014 –17.1.2020)  
Senegal  5 years (20.11.2014 —19.11.2019)  
On 19 July 2019 , the EU and Senegal negotiators paraphed  a new implementing 
protocol to the existing sustainable fisheries partnership agreement166  
Multi -species agreements : EU vessels are allowed to catch a wide range of fish stocks in the 
partner country's EEZs   
Greenl and 5 years (1.1.2016 –31.12.2020)  
Guinea -Bissau   5 years (15.6.2019 –14 06.2024)  
Mauritania  4 years (16.11.2015 -15.11.2019)  
Morocco  4 years ( 18.07.2019 -17.07.2023)  
To be activated shortly  
São Tomé and 
Principe   Protocol expired on 22.05.2018  
On 17 April 2019 , the EU and S ão Tomé and Principe negotiators paraphed a new 
implementing protocol to the existing sustainable fisheries partnership agreement  
Dormant agreements  
Equatorial Guinea  Protocol expired on 30.06.2001  
Gabon  Protocol expired on 23.07.2016  
Kiribati  Protocol expired on 15.09.2015  
Madagascar  Protocol expired on 31.12.2018  
Micronesia   Protocol expired on 24.02.2010  
Mozambique   Protocol expired on 31.01.2015  
Solomon Islands   Protocol expired on 8.10.2012  
Source:  European Commission,  Bilateral agreements with countries outside the EU . Viewed at: 
https://ec.europa.eu/fisheries/cfp/international/agreements_en ; and information provided by the 
authorities.  
4.1.2.6   Structural support  
4.117.   The European Maritime and Fisheries Fund (EMFF) serves as a financial tool in support of the 
CFP ( Section 3.3.1.1 ). During the period 2014 -20, the Fund amounts to EUR  6.4 billion, of which 
                                                
165 Publications Office of the European Union, EU sustainable fisheries partnership agreements. Viewed 
at: https://publications.europa.eu/en/publication -detail/ -/publication/c8b5d962 -0d38-11e7-8a35-
01aa75ed71a1/language -en/format -PDF/so urce-37907030 . 
166 European Commission, EU signs sustainable fishing partnership agreement protocol with Senegal . 
Viewed at: https://ec.europa.eu/fisheries/press/eu -concludes -sustainable -fishing -partnership -agreement -
protocol -senegal_en .  WT/TPR/S/395 • European Union  
 
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  89% is managed by the member States.167 Each member State is allocated a share of the total 
budget, based on a number of criteria related to the size of its fishing industry. Spain is the largest 
recipient of the funding (20.0% of the total EMFF), followed by France (10.2%), and Italy (9.3%).168 
The member States can decide which measures covered by the EMFF to implement, based on their 
own operational programmes.169 A number of projects have been funded by the EMFF in order to 
meet requirements under the CFP. For example, member States spent EUR 40 million ( of the total 
amount of EUR 89 million committed ) of EMFF support on the implementation of the landing 
obligations (e.g. support for landing, storing, processing and marketing of those catches).170  
4.118.   On 2 May 2018, the European Commission proposed a new EMFF budget (EUR 6.14 billion) 
for 2021 -27.171 The proposed EMFF  budget  will focus on four  priorities: (i) fostering sustainable 
fisheries and the conservation of marine biological resources; (ii) contributing to food security in the 
EU through sustainable and competitive aquaculture and markets;  (iii) enabling the growth of a 
sustainable blue economy and fostering prosperous coastal communities; and (iv) strengthening 
international ocean governance and enabling sa fe, secure, clean and sustainably -managed seas and 
oceans.172 The new proposed EMFF  budget  aims at simplifying the delivery of the Fund and providing 
greater flexibility to member States regarding their strategic priorities, instead of "pre -defined" 
measures ; aligning with the other EU structural and investment funds ; broadening support  for 
coastal communities ; and support for international commitments for better international ocean 
governance at bilateral, regional and multilateral levels.173 
4.119.   In addition to the EMFF, the member States may provide state aid to the fisheries and 
aquaculture sector, pursuant to the guidelines on state aid174 (Section 3.3.1.2 ). State aid is, in 
principle, not compatible with the internal market (Article 107(1) of the TF EU), except for some 
cases such as de minimis  aid and certain types of subsidies covered by the Fishery and Aquaculture 
Block Exemption Regulation. De minimis  state aid cannot exceed EUR 30,000 per beneficiary over 
three  years, and cannot exceed 2.5% of th e annual turnover on fisheries output per member 
State.175 In accordance with Article 2 of the Regulation, certain types of subsidies may be provided 
to SMEs for projects reflecting the objectives of the EMFF, with eligible costs that do not exceed 
EUR 2 million or if the amount of aid does not exceed EUR  1 million per beneficiary per year.176 If 
none of these two specific cases is applicable, each member State must notify any state trading 
scheme to the Commission, declaring that it complies with the TFEU befo re it can be implemented.177 
                                                
167 European Commission, European Maritime and Fisheries Fund (EMFF) . Viewed at: 
https://ec.europa.eu/fisheries/cfp/emff_en . The EMFF covers six priorities: sustainable fisheries, sustainable 
aquaculture, implementing the CFP, marketing and processing, employment and territorial cohesion, and 
integrated maritime policy.  
168 European Union, Facts and figures on the common fisheries policy – 2018 Edition , p. 48. Viewed at: 
https://ec.europa.eu/fi sheries/sites/fisheries/files/docs/body/pcp_en.pdf . 
169 European Commission, EMFF country files Operational Programmes 2014 –2020. Viewed at: 
https://ec.europa.eu/fisheries/cfp/emff/country -files.  
170 European Commission, Communication on the State of Play of the Common Fisheries Policy and 
Consultation on the Fishing Opportunities for 2020 , pp. 4 -5. Viewed at: 
https://ec.europa.eu/transparency/regdoc/rep/1/2019/EN/COM -2019-274-F1-EN-MAIN -PART-1.PDF . 
171 European Commission, Questions and answers on the new European Maritime and Fisheries Fund 
(EMFF) 2021 -2027. Viewed at: https://ec.europa.eu/fisheries/press/questions -and-answers -new-european -
maritime -and-fisheries -fund-emff-2021-2027_en .  
172 European Commission , EU Budget for the future, June 2018 . Viewed at: 
https://ec.europa.eu/commission/sites/beta -political/files/budget -may2018 -maritime -fisheries -fund_en.pdf . 
173 European Commission, EU Budget for the future.  Viewed at: 
https://ec.europa.eu/commission/sites/beta -political/files/budget -may2018 -maritime -fisheries -fund_en.pdf . 
174 European Commission, Guidelines for the examination of State aid to the fishery and aquaculture 
sector . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52015XC0702(01)&from=EN . 
175 Commission Regulation (EU) 717/2014 of 27 June 2014 on the application of Articles 107 and 108 of 
the Treaty on the Functioning of the European Union to de minimis aid in the fishery and aquaculture sector, 
Article 3. Viewed at: https://eur -lex.europa.eu/le gal-content/EN/TXT/PDF/?uri=CELEX:32014R0717&from=EN . 
176 Commission Regulation (EU) No. 1388/2014 of 16 December 2014 declaring certain categories of aid 
to undertakings active in the production, processing and marketing of fishery and aquaculture products 
compatible with the internal market in application of Articles 107 and 108 of the Treaty on the Functioning of 
the European Union. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32014R1388&from=FR . 
177 Council Regulation (EU) 2015/1589 of 13 July 2015 laying down detailed rules for the application of 
Article 108 of the Treaty on the Functioning of the European Union (codification), Articl e 3. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32015R1589&from=EN ; and Commission 
Regulation (EC) No. 794/2004 of 21 April 2004 implementing Council Regulation (EC) No. 659/1999 laying WT/TPR/S/395 • European Union  
 
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  Moreover, tax exemptions from indirect taxes (e.g. excise duties) for energy products used for water 
navigation (including fishing) in the territorial waters of EU member States are granted in accordance 
with Article 14(1)(c) of the Council Directive 2003/96/EC .178 For example, fuel tax exemption for 
inland fisheries and commercial marine fishing in Estonia was notified to the WTO during the review 
period.179 
4.120.   According to the OECD, total government financial transfers to the marine ca pture fisheries 
sector in the EU were EUR  440 million in 2017, of which: nearly 60% was for general service support, 
such as management of resources, R&D, and support to fishing communities. However, data were 
not available for all EU member States.180  
4.121.   The EU budget for maritime affairs and fisheries  was EUR 927 million in payments in 201 8. 
Around 84.7% of this amount  was for the EMFF, 10.5% for c ompulsory contribution s to RFMOs, 
other international organizations, and SFPAs, and 4.8% for administrative expen diture.181 
4.2  Energy  
4.122.   The EU imported 55.1% of its energy in 2017, making it the world's largest energy 
importer182, with an annual energy -import bill averaging EUR 300 billion over the last five years . 
Some EU  member States depend on one or two external suppliers for their entire gas imports, and 
therefore remain vulnerable to supply shocks.183 It has been estimated that every additional 1% 
increase in energy savings cuts gas imports by 2.6%. Some 75% of the EU's housing stock is 
energy  inefficient, and 94%  of transport relies on oil products, of which around 90% is imported. 
Collectively, the EU spends some EUR 120 billion per year, directly or indirectly, on energy subsidies, 
often not justified.184  
4.123.   Production of primary energy in t he EU-28 has been decreas ing over the last few years, 
partly due to the exhaustion of natural resources and/or producers considering their exploitation  
uneconomical.185 According to the latest available figures, in 2017, it reached 758.2 million tonnes 
of oil equivalent (toe) (Table  4.15), i.e. 5.6% of worldwide production, and 14.7% lower than a 
decade earlier (862.9 million toe in 2007). In 2017, production of primary energy was dominated by 
France, with a 17.4% share of the EU -28, followed by the United Kingdom (15.6%) and Germany  
(15.3%).186 
                                                
down detailed rules for the application of Article 93 of the EC Treaty, Article 2. Viewed at: https:// eur-
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32004R0794&from=EN .  
178 Council Directive 2003/96/EC of 27 October 2003 restructuring the Community framework for the 
taxation of energy products and electricity. Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:283:0051:0070:EN:PDF . 
179 WTO document G/SCM/N/343/EU/Add.8, 13 August 2019.  
180 OECD Stat, Fisheries Support Estimate . Viewed at: 
https://stats.oecd.org/Index.aspx?datasetcode=FISH_FSE . Data were available for 16 countries: Belgium, 
Denmark, Estonia, France, Germany, Greece, Ireland, Italy, Latvia, Lithua nia, the Netherlands, Portugal, 
Slovenia, Spain, Sweden, and the United Kingdom.  
181 European Union Budgets. European Commission Documents, Draft General Budget of the European 
Union for the financial year 2020, Volume 3, Section III, Commission.  Viewed at: https://eur -
lex.europa.eu/budget/data/DB/2020/en/SEC03.pdf . Figures are based on the following budget chapters: 1101, 
1103 (110301 and 110302), and 1106.  
182 Eurostat, Energy product ion and imports: Statistics Explained . Viewed at: 
https://ec.europa.eu/eurostat/statistics -explained/pdfscache/1216.pdf . 
183 European Commission, Fourth Report on the State of the Energy Union. Viewed at: 
https://ec.europ a.eu/commission/publications/4th -state-energy -union_en . 
184 European Commission, A Framework Strategy for a Resilient Energy Union with a Forward -Looking 
Climate Change Policy. Viewed at: https://eur -lex.europa.eu/resource.html?uri=cellar:1bd46c90 -bdd4-11e4-
bbe1-01aa75ed71a1.0001.03/DOC_1&format=PDF . 
185 Primary energy production takes place when natural resources are exploited (e.g. coal mines, crude 
oil fields, or hydro power plants). Tran sformation of energy from one form to another, such as electricity or 
heat generation in thermal power plants, is not considered as primary energy production.  
186 Compared with a decade earlier, some of the main changes were falls of 41.7 and 32.8 percentag e 
points, respectively, in the shares of Denmark and the United Kingdom, and increases of 17.8 and 
13.5 percentage points in the shares of Italy and Spain. Eurostat, Energy production and imports: Statistics 
Explained . Viewed at: https://ec.europa.eu/eurostat/statistics -explained/pdfscache/1216.pdf . WT/TPR/S/395 • European Union  
 
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  Table 4.15 Energy production, 2017  
 Total 
production of 
energy  Share of total production (%)  
Nuclear 
energy  Solid 
fossil fuels  Natural 
gas Crude 
oil Renewable 
energy  Other  
EU-28 758.2  27.8 16.4 13.6 8.8 29.9 3.5 
Belgium  14.9 74.0 0.0 0.0 0.0 21.6 4.4 
Bulgaria  11.7 33.8 48.6 0.6 0.2 16.6 0.3 
Czech 
Republic  27.3 25.7 55.5 0.7 0.4 16.3 1.5 
Denmark  15.9 0.0 0.0 27.4 43.6 26.5 2.4 
Germany  115.8  17.0 34.1 5.2 1.9 36.8 5.0 
Estonia  5.8 0.0 0.0 0.0 0.0 27.0 73.0 
Ireland  4.9 0.0 0.0 58.6 0.0 23.5 17.9 
Greece  7.5 0.0 60.9 0.1 1.9 37.1 0.0 
Spain  34.2 44.2 3.3 0.1 0.4 51.3 0.8 
France  132.2  78.6 0.0 0.0 0.6 19.6 1.2 
Croatia  4.2 0.0 0.0 29.2 16.7 52.1 1.9 
Italy 36.7 0.0 0.0 12.4 11.3 72.4 4.0 
Cyprus  0.1 0.0 0.0 0.0 0.0 97.5 2.5 
Latvia  2.6 0.0 0.0 0.0 0.0 99.7 0.3 
Lithuania  1.8 0.0 0.0 0.0 3.2 94.4 2.3 
Luxembourg  0.2 0.0 0.0 0.0 0.0 80.8 19.2 
Hungary  11.1 36.6 11.5 12.7 6.4 28.6 4.2 
Malta  0.0 0.0 0.0 0.0 0.0 100.0  0.0 
Netherlands  41.7 1.9 0.0 79.5 2.3 13.4 2.8 
Austria  12.3 0.0 0.0 8.5 5.7 79.6 6.2 
Poland  64.0 0.0 77.4 5.5 1.6 14.2 1.4 
Portugal  5.2 0.0 0.0 0.0 0.0 97.1 2.9 
Romania  25.5 11.4 17.5 33.5 13.8 22.9 0.9 
Slovenia  3.5 42.3 26.6 0.2 0.0 29.4 1.5 
Slovak  
Republic  6.4 62.6 7.0 1.8 0.1 25.4 3.1 
Finland  18.1 29.8 0.0 0.0 0.0 64.5 5.6 
Sweden  36.6 44.7 0.0 0.0 0.0 53.0 2.3 
United 
Kingdom  118.1  12.8 1.6 30.5 37.8 13.2 4.2 
Source:  Eurostat, Energy production and imports: Statistics Explained . Viewed at: 
https://ec.europa.eu/eurostat/statistics -explained/pdfscache/1216.pdf . 
4.124.   Primary energy production in the EU -28 was led by renewable energy (29.9% of the total in 
2017), followed by nuclear energy (27.8%), solid fossil fuels (largely coal), natural gas, crude oil, 
and other (Table 4.15). The significance of nuclear energy was particularly high in France (78.6% of 
the national production of primary energy) a nd Belgium (74.0%), while Germany announced plans 
to close its nuclear reactors by 2022. Germany will also close down all 84 of its coal plants by 2038, 
and will need to get 65% -80% of its power from renewables.187 Several other EU member States 
introduced o r confirmed objectives and timelines to phase out coal for electricity generation. France 
intends to do so by 2022, Italy and Ireland by 2025, and Denmark, Finland, the Netherlands, 
Portugal and Spain by 2030.188 In 2007 -17, the production of renewables in t he EU -28 increased by 
65.6%, exceeding that of all the other energy types.189 By contrast, the production levels for the 
other sources fell over the same period: natural gas ( -39.4%), crude oil ( -38.9%), solid fuels 
(-30.5%), and nuclear energy ( -12.8%).190 
4.125.   All EU member States are net importers of energy, with imports of primary energy exceeding 
exports by around 948 million toe in 2017 (Table 4.16). The largest net importers of primary energy 
                                                
187 Germany is the world's sixth largest greenhouse gas polluter, mainly due to coal; Germany gets 
almost a third of its electr icity from coal. NY Times. Germany lays out a path to quit coal by 2018 . Viewed at: 
https://www.nytimes.com/2019/01/26/world/europe/germany -quit-coal-2038.html .  
188 European Commission, United in delivering the Energy Union and Climate Action - Setting the 
foundations for a successful clean energy transition . Viewed at: 
https: //ec.europa.eu/energy/sites/ener/files/documents/recommondation_en.pdf ; and relevant Commission 
Recommendations of 18 June 2019 on the draft integrated National Energy and Climate Plans covering the 
period 2021 -30. 
189 Almost 80% of renewable energy in the E U-28 is biomass and waste, followed by hydro power, wind, 
solar energy, and geothermal energy. Eurostat, Energy production and imports: Statistics Explained . Viewed 
at: https://ec.europa.eu/eurostat/statistics -explained/pdfscache/1216.pdf . 
190 Eurostat, Energy production and imports: Statistics Explained . Viewed at: 
https://ec.europa.eu/eurostat/statistics -explained/pdfscache/1216.pdf . WT/TPR/S/395 • European Union  
 
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  are generally the most populous EU member States, except Poland whe re some indigenous reserves 
of coal remain. Relative to population size, the largest net importers are Luxembourg, Malta and 
Belgium.191 
Table 4.16 Net imports of energy, 2007 -17 
 Million toe Toe per inhabitant  
2007  2009  2011  2013  2015  2017  2007  2009 2011  2013  2015  2017  
EU-28 989 939 953 916 906 948 2.0 1.9 1.9 1.8 1.8 1.8 
Belgium  51 48 48 49 50 48 4.8 4.5 4.4 4.3 4.4 4.2 
Bulgaria  10 8 7 7 7 7 1.4 1.1 1.0 0.9 1.0 1.1 
Czech Republic  12 12 13 12 13 16 1.1 1.1 1.2 1.1 1.3 1.5 
Denmark  -5 -4 -1 2 2 2 -1.0 -0.7 -0.2 0.4 0.4 0.4 
Germany  200 198 199 207 198 207 2.4 2.4 2.5 2.6 2.4 2.5 
Estonia  2 1 1 1 1 0 1.2 0.9 0.6 0.7 0.4 0.2 
Ireland  14 13 13 12 13 10 3.2 2.9 2.7 2.7 2.7 2.1 
Greece  24 22 19 16 18 19 2.2 2.0 1.8 1.5 1.7 1.7 
Spain  124 111 105 90 95 102 2.7 2.4 2.3 1.9 2.1 2.2 
France  138 134 131 129 120 125 2.2 2.1 2.0 1.9 1.8 1.9 
Croatia  5 4 5 4 4 5 1.2 1.0 1.1 1.0 1.0 1.2 
Italy 158 141 141 123 121 125 2.7 2.4 2.4 2.0 2.0 2.1 
Cyprus  3 3 3 2 2 3 3.8 3.6 3.1 2.7 2.9 3.1 
Latvia  3 3 3 3 2 2 1.4 1.4 1.3 1.3 1.2 1.1 
Lithuania  6 4 6 5 5 6 1.8 1.4 2.0 1.8 1.9 2.0 
Luxembourg  4 4 4 4 4 4 9.3 8.5 8.5 7.7 7.0 6.9 
Hungary  17 15 13 12 14 17 1.7 1.5 1.3 1.2 1.4 1.7 
Malta  2 2 2 2 2 3 4.4 4.9 5.5 5.0 5.0 6.4 
Netherlands  37 32 28 22 43 47 2.3 2.0 1.7 1.3 2.5 2.7 
Austria  23 21 24 21 20 22 2.8 2.5 2.8 2.5 2.3 2.5 
Poland  25 30 35 26 29 40 0.7 0.8 0.9 0.7 0.8 1.1 
Portugal  22 21 19 17 18 20 2.1 2.0 1.8 1.6 1.8 1.9 
Romania  12 7 8 6 5 8 0.6 0.3 0.4 0.3 0.3 0.4 
Slovenia  4 3 4 3 3 3 1.9 1.7 2.0 1.8 1.5 1.4 
Slovak  Republic  12 11 11 10 10 11 2.3 2.1 2.1 1.9 1.8 2.1 
Finland  20 19 19 17 16 15 3.8 3.5 3.6 3.1 2.9 2.7 
Sweden  19 18 19 17 15 14 2.1 1.9 2.0 1.8 1.5 1.4 
United Kingdom  46 57 74 96 73 66 0.7 0.9 1.2 1.5 1.1 1.0 
Source:  Eurostat, Energy production and imports: Statistics Explained . Viewed at: 
https://ec.europa.eu/eurostat/statistics -explained/pdfscache/1216.pdf . 
4.126.   The origin of EU energy imports changed somewhat in recent years, although the 
Russian  Federation remains the main supplier of crude oil (30.3% of total imports in 2017), natural 
gas (38.7%), and hard coal (38.9%). The security of the EU's primary energy supplies may be 
threatened if a high proportion of imports are concentrated among relatively few partners. In 2017, 
74.6% of the EU's imports of natural gas came from the Russian Federation, Norway and Algeria; 
72.7% of the hard coal imports originated fro m the Russian Federation, Colombia and the 
United  States; while the Russian Federation, Norway and Iraq accounted for 49.9% of the 
EU's imports of crude oil.192 
4.127.   More than half of the EU's energy needs are covered by imports. Indeed, dependency on 
energy impo rts increased from about 44.0% of gross available energy in 1990 to 55.1% in 2017. 
The highest dependency rate is for crude oil (86.7% in 2017), followed by natural gas (74.3%), and 
solid fossil fuels (43.9%). In 2017, the lowest dependency rates were reco rded for Estonia, Denmark, 
Romania and Sweden, driven by a combination of energy -efficiency gains and/or a switch to 
renewable resources. Malta, Cyprus and Luxembourg were almost entirely dependent on primary 
energy imports, with dependency rates of over 9 5.0%.193 
4.128.   Imports of electricity from outside the EU are duty free.  
4.129.   SOEs continue to play an important role in  the EU's energy sector (Section 3.3.5).  
4.130.   The EU enjoys shared legislative powers with its member States  in energy -related matters. 
The division of power in energy matters and a move towards a common energy policy are contained 
                                                
191 Eurostat, Energy Production and imports: Statistics Explained.  
192 Eurostat, Energy Production and imports: Statistics Explained.  
193 Eurostat, Energy Production and imports: Statistics E xplained.  WT/TPR/S/395 • European Union  
 
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  in Article 194 of the Energy Title (Title XXI) in the TFEU. Each member State maintains its right to 
"determine the conditions for e xploiting its energy resources, its choice between different energy 
sources and the general structure of its energy supply".194 Other legal provisions of the TFEU on 
energy include: Article s 114 (internal energy market); 122 (security of supply); 170 -172 (en ergy 
networks); and 216 -218 (external energy policy). In addition, Protocol 37 clarifies the financial 
consequences resulting from the expiry of the European Coal and Steel Community (ECSC) Treaty 
in 2002; while the Treaty establishing the European Atomic Energy Community (Euratom Treaty) 
serves as the legal basis for most EU actions in the field of nuclear energy.195 
4.131.   On 3 March 2010, the Energy 2020 strategy on climate change and energy was proposed by 
the European Commission, with the following interrelated  and mutually supportive targets  (also 
known as the "20 -20-20" targets)196: 20% reduction in greenhouse gas (GHG) emissions compared 
with 1990 levels; 20% share of renewable energy in gross final energy consumption; and 20% cut 
in energy consumption compared  to a 2020 business -as-usual projection. In October 2014, the 
European Council agreed the 2030 Climate and Energy Policy Framework  (see below) .197 The Energy 
Union Package 2015 set out to give EU consumers secure, sustainable, competitive and affordable 
energy by overhauling energy and climate policies.198 Under the Package, there are 
five mutually -reinforcing and interrelated objectives of the EU's energy policy: improving security of 
energy supply ; completing the internal energy market; boostin g energy efficiency; decarbonizing 
the economy and becoming the world leader in renewable energy ; and promoting research, 
innovation and competitiveness (see below).  
4.132.   In 2018 and 2019, the EU adopted a new comprehensive legislative framework for energy 
and climate policies . The European Parliament and Council agreed on a revision of the EU 's climate 
legislation, including the Emissions Trading System Directive199, both for stationary installations and 
for aviation, the Effort Sharing Regulation200, and the Regu lation on Land Use, Land Use Change and 
Forestry .201 They also agreed on the eight legislative proposals in the "Clean Energy for All 
Europeans " package  (all of which have entered into force)202, and on the ten mobility proposals 
following the Low -Emission Mob ility Strategy.203 This framework is expected to put the EU on a good 
trajectory to a climate -neutral economy by 2050  (see below) . 
4.133.   The 2030 Climate and Energy Policy Framework  and the updated legislative framework set 
out quantified objectives for 2030, namely: to reduce GHG emissions domestically by at least 40% 
compared to 1990 levels; to reach a share of at least 32% in renewable energy; and to increase 
energy efficiency by at lea st 32.5%  at EU level . The electricity interconnections target set to improve 
security of supply by stepping up to 15% in each member State by 2030. A legal framework on the 
                                                
194 Art. 194(2), TFEU.  
195 European Parliament. Energy Policy: General Principles . Viewed at: 
http://www.europarl.europa.eu/ftu/pdf/en/FTU_2.4.7.pdf . 
196 European Commission, Energy  2020: A Strategy for competitive, sustainable and secure energy. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=legissum:en0024 . 
197 European Commission, A p olicy framework for climate and energy in the period from 2020 to 2030. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52014DC0015&f rom=EN . 
198 European Commission, A Framework Strategy for a Resilient Energy Union with a Forward -Looking 
Climate Change Policy. Viewed at: https://eur -lex.europa.eu/resource.html?uri=cellar:1bd46c90 -bdd4-11e4-
bbe1-01aa75ed71a1.0001.03/DOC_1&format=PDF . 
199 Directive (EU) 2018/410 of the European Parliament and of the Council of 14 March 2018 amending 
Directive 2003/87/EC to enhance c ost-effective emission reductions and low -carbon investments, and Decision 
(EU) 2015/1814. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=C ELEX:32018L0410&from=EN . 
200 Regulation (EU) 2018/842 of the European Parliament and of the Council of 30 May 2018 on binding 
annual greenhouse gas emission reductions by Member States from 2021 to 2030 contributing to climate 
action to meet commitments unde r the Paris Agreement and amending Regulation (EU) No . 525/2013. Viewed 
at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32018R0842&from=EN .  
201 Regulation (EU) 2018/841 of the European Parliament and of the Council of 30  May 2018 on the 
inclusion of greenhouse gas emissions and removals from land use, land use change and forestry in the 2030 
climate and energy framework, and amending Regulation (EU) No . 525/2013 and Decision No . 529/2013/EU. 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32018R0841&from=EN . 
202 European Commission, Clean Energy for All Europeans. Viewed at: https://eur -
lex.europa.eu/resource.html?uri=cellar:fa6ea15b -b7b0-11e6-9e3c-
01aa75ed71a1.0001.02/DOC_1&format=PDF . 
203 European Commission, A European Strategy for Low -Emission Mobility. Viewed at: https://eur -
lex.europa.eu/resource.html?uri=cellar:e44d3c21 -531e-11e6-89bd-
01aa75ed71a1.0 002.02/DOC_1&format=PDF . WT/TPR/S/395 • European Union  
 
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  governance of the energy union was put in place , in order to ensure that the 2030 t argets are met , 
individually and collectively.204 It relies, among others, on a requirement for all member States to 
establish National Energy and Climate Plans for the period 2021 -30. Draft Plans have been submitted  
and assessed by the European Commission, with final Plans to be provided by end -2019.  Binding 
targets for 2030 were also set to reduce carbon emissions from cars by 37.5% compared to 2021 
levels; from vans by 31 .0% compared to 2021 levels; and from lorries by 30 .0% compared to 2019 
levels.205 
Improving security of energy supply  
4.134.   Diversification of energy  sources, suppliers and routes , and more efficient energy 
consumption are crucial for ensuring secure and resilient energy supplies . The EU took several 
measures in this regard during the last fe w years. Member States, for example, are required to 
maintain a minimum of oil stocks, corresponding to 90 days of average daily net imports or 61 days 
of average daily inland consumption, whichever is greater.206  
4.135.   New rules on security of gas supply and ele ctricity risk preparedness were adopted to 
organi ze operational cross -border regional cooperation , to prevent and manage the risk of gas 
disruptions, electricity shortage s or black -outs.207 Progress was also made in improving the design 
of electricity markets , including  a more integrated set of rules.208 According to the Commission, 
these rules improv e efficiency through increased price convergence and cross -border exchanges.  
Recent investments in smart in frastructure also prepared the grid for the changing energy system.209 
4.136.   In the Commission's view, p rogress was also made in the gas market, notably with the 
revision of the Gas Directive, according to which gas pipelines entering or leaving the 
European  internal gas market must now  comply with EU rules. In addition, the Commission  can now 
ensure that member States ' agreements with countries outside the EU comply with EU law before 
they are concluded. These measures are expected to increase the predictability of the single market 
for investors.210  
4.137.   Efforts were also made to ensure  the diversification of gas supply , and end dependency on 
a single supplier in certain member States. As a result, all member States but one ha ve access to 
two independent sources of gas and , if all ongoing projects are implemented on schedule, all 
member  States except for Malta and Cyprus will  have access to three sources of gas by 2022, and 
23 member States will have access to the global liquefied natural gas (LNG) market.211  
4.138.   The transition towards a more secure and sustainable energy system will require major 
investments in generation, network s and energy efficiency, estimated at some EUR 200 billion 
annually in the next decade. The private sector is expected to bear the brunt of the costs. The 
                                                
204 Regulation (EU) 2018/1999 of the European Parliament and of the Council of 11 December 2018 on 
the Governance of the Energy Union and Climate Action, amending Regulations (EC) No . 663/2009 and (EC) 
No. 715/2009 of the European Pa rliament and of the Council, Directives 94/22/EC, 98/70/EC, 2009/31/EC, 
2009/73/EC, 2010/31/EU, 2012/27/EU and 2013/30/EU of the European Parliament and of the Council, Council 
Directives 2009/119/EC and (EU) 2015/652 and repealing Regulation (EU) No . 525/2013 of the European 
Parliament and of the Council. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32018R1999&from=EN . 
205 European Com mission, Fourth Report on the State of the Energy Union. Viewed at: 
https://ec.europa.eu/commission/publications/4th -state-energy -union_en . 
206 Council Directive 2009/119/ EC of 14 September 2009 imposing an obligation on Member States to 
maintain minimum stocks of crude oil and/or petroleum products. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32009L0119&from=EN . 
207 Regulation (EU) 2017/1938 of the European Parliament and of the Council of 25 October 2017 
concerning measures to safeguard the security of gas supply and repealing Regulation (EU) No . 994/2010, 
Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32017R1938&from=EN .  
Proposal for a Regulation of the European Parliament a nd of the Council on risk -preparedness in the 
electricity sector and repealing Directive 2005/89/EC. Viewed at: https://eur -
lex.europa.eu/resource.html?uri=cellar:1d8d2670 -b7b2-11e6-9e3c-
01aa75ed71a1.0001.02/DOC_1&format=PDF . 
208 European Commission. Markets and consumers . Viewed at: 
https://ec.europa.eu/ene rgy/en/topics/markets -and-consumers .  
209 European Commission, Fourth Report on the State of the Energy Union.  
210 European Commission, Fourth Report on the State of the Energy Union.  
211 European Commission, Fourth Report on the State of the Energy Union.  WT/TPR/S/395 • European Union  
 
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  European Investment Bank, the Connecting Europe Facility and the European Structural and 
Investment F unds already p articipate . Moreover, the European Fund for Strategic Investments will 
provide additional support , facilitating access to finance for projects of European significance , such 
as in energy networks, renewable energy and energy efficiency.  
Completing the internal energy market  
4.139.   A key driver of energy security is the completion of the EU internal energy market , which is 
crucial  to providing EU citizens with a supply of secure , sustainable, competitive and affordable 
energy.  The third energy package  is one of the main legislative instruments in this regard, further 
liberalizing the gas and electricity markets. The package entered into force on 3 September 2009 
and refers to measures in five main areas: unbundling (separation of the operation of electricity and 
gas transmission networks from the supply and generation activities); facilitating cross -border 
energy trade , and assisting  National Regulatory Authorities (NRAs)  through the establishment of the 
Agency for the Cooperation of Energy R egulator s (ACER) ; promoting cross -border collaboration and 
investment through the e stablishment of the European Networks of Transmission System Operat ors 
for Electricity and Gas (ENTSO -E/G); greater transparency and improved record keeping; and access 
to storage and LNG facilities.212  
4.140.   On 5 June 2019, the E U published Regula tion (EU)  No. 2019/943 on the internal market for 
electricity  and Directive (EU) No. 2019/944 on common rules for the internal market for electric ity. 
Regulation (EU)  No. 2019/943  "sets the basis for an efficient achievement of the objectives of the 
Energy Union and in particular the Climate and Energy Policy Framework for 2030 by enabling market 
signals to be delivered for increased efficiency, hig her share of renewable energy sources, security 
of supply, flexibility, sustainability, decarbonization and innovation". It aims at providing the 
fundamental principles of the future common electricity market, describes how a fair cross -border 
exchange in electricity should be conducted, and sets the basic rules to encourage free price 
formation and more flexible generation and demand.213  
4.141.   Directive (EU) No. 2019/944 "establishes common rules for the generation, transmission, 
distribution, energy storage and supply of electricity, together with consumer protection provisions, 
with a view to creating a truly integrated competitive, consumer -centred, flexible, f air and 
transparent electricity market in the EU". The provisions also aim to ensure, inter alia , that electricity 
consumers are free to purchase power from the supplier of their choice and can also have more than 
one electricity supply contract at the sam e time, provided that the required connections and 
metering points are established. In addition, consumers should be free to buy and trade electricity 
services independently from their electricity supply contracts.214 
4.142.   According to the Commission , energy in the EU is now traded more freely (although still not 
sufficiently freely) across borders, building on the Electricity and Gas Market Directives215, as well 
as antitrust enforcement.216 As concerns electricity, the measurable decrease in wholesale electricity 
prices by 6.4% between 2010 and 2017 contributed to a decrease in the price of energy for 
                                                
212 Other internal energy market instruments include: Regulation on Guidelines for Trans -European 
Energy Infrastructure (Regulation (EU) 347/2013); Regulation on Wholesale Energy Market Integrity and 
Transparency (Regulation (EU) 1227/2011); Electricity Direct ive (COM(2016) 864); Electricity Regulation 
(COM(2016) 861); and Risk -Preparedness Regulation (COM(2016) 862).  
213 Regulation (EU) 2019/943 of the European Parliament and of the Council of 5 June 2019 on the 
internal market for electricity (recast). Viewed a t: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/? uri=CELEX:32019R0943&from=EN . 
214 Directive (EU) 2019/944 of the European Parliament and of the Council of 5 June 2019 on common 
rules for the internal market for electricity and amending Directive 2012/27/EU (recast). Viewed at: 
https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019L0944&qid=1573829683251&from=EN . 
215 Directive 2009/72/EC of the European parl iament and of the Council of 13 July 2009 concerning 
common rules for the internal market in electricity and repealing Directive 2003/54/EC. Viewed at: https:/ /eur-
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32009L0072&from=EN . Directive 2009/73/EC of the 
European. parliament and of the Council of 13 July 2009 concerning common rules for the internal market in 
natural gas and repealing Directive 2003/55/EC . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32009L0073&from=EN .  
216 Antitrust decisions gave customers in Central and Eastern Eur ope an effective tool to make sure they 
have access to more competitive gas prices, most recently in the following decisions: AT.39816 Gazprom 
commitment decision, AT.40461 DE -DK Interconnectors commitment decision, and AT.39849 BEH Gas 
prohibition decisio n.  WT/TPR/S/395 • European Union  
 
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  households and industry by  6% and 30%, respectively. However, the increase in network charges , 
taxes and levies led to an average increase in final consumer prices of 1 9.3% for households and 
8.7% for industrial consumers across the EU over the same period. Energy -related taxes and levies 
represent up to 40% of the retail energy price for households.217 
4.143.   The EU still faces challenges to the completion of its internal energy market. For example, 
in the view of the Commission,  the digitization of the power infrastructure will require improv ed 
cybersecurity and protect ion of the critical infrastructure.  Moreover, w hile investments made have  
enabled sector integration, the Commission  considers that more needs to be done to bring together 
the power generation and end -use sectors.218 According to the Commission , this is necessary to 
integrate the rising share of renewable energy; heating and cool ing; and electric vehicles in the 
energy system.  This will be a key area of attention for the future , as demand for electrical vehicles 
will vary across regions and will depend on factors  such as  the development of alternative fuel 
infrastructure.219 
Boostin g energy efficiency  
4.144.   The current energy -efficiency framework consists of several  directives, the revision  of which 
is either ongoing or planned. The Energy Efficiency Directive No. 2012/27/EU , as amended by 
Directive (EU) No. 2019/944, requires member States to set indicative national energy -efficiency 
targets. As a lready indicated, the EU aims to achieve at least a 20% improvement in energy 
efficiency  by 2020, and at least 32.5% by 2030.  
4.145.   In the view of the Commission , there is a need to further intens ify efforts to reach the 2020 
energy -efficiency target . Indeed, f ollowing a gradual decrease between 2007 and 2014, energy 
consumption started to increase in recent years, and is now slightly above the linear trajectory for 
the 2020 targets. This is due to  colder years 2015 and 2016, but also increased economic activity 
and low oil prices.220 While the 2020 target is still within reach, continued increase in energy 
consumption could put it at risk. As a result, t he Commission  established a Task Force with member 
States to mobili ze efforts and fully exploit energy -efficiency potentials. In the transport sector, 
energy consumption and emissions decreased between 2007 and 2013, but are now roughly back 
at 2005 levels. The positiv e impact of efficiency policies was outweighed by increased transport 
activity, and low capacity utili zation in road -freight transport.221 
4.146.   The Energy Efficiency Directive also requires member States to assess and notify the 
Commission of the potential for hi gh-efficiency cogeneration and district heating and cooling on their 
territory , and to conduct a cost -benefit analysis based on climate conditions, economic feasibility 
and technical suitability (with some exemptions). Member States  are free to make these  minimum 
requirements more stringent as they strive to save energy. The Directive  also introduces  a binding 
set of measures to help member States  achieve this target , and sets legally -binding rules for 
end-users and energy suppliers.  
4.147.   Further energy -efficiency standards  for products and buildings were set , with the Ecodesign 
Directive ( No. 2009/125/EC), the  Energy Efficiency Labelling Directive ( No. 2010/30/EU) and the 
Energy Performance of  Buildings Directive ( No. 2010/31/EU).  The application of mini mum 
requirements to the energy performance of new buildings and new building units, establish es, for 
instance, that , by 31  December 2020 , all new buildings must be nearly zero -energy.  
4.148.   In the framework of the Energy Union Package, the Commission  launched the EU Strategy 
on Heating and Cooling.222 It includes plans to boost the energy efficiency of buildings, improve 
                                                
217 European Commission, Fourth Report on the State of the Energy Union.  
218 Since the end of 201 9, close to EUR 400 million in Connecting Europe Facility (CEF) grants were 
made available to over 50 projects to deploy alternative fuels, mobilizing total in vestments exceeding 
EUR 3 billion. The aim is to make available an additional EUR 350 million through the CEF blending facility in 
2019. European Commission, Fourth Report on the State of the Energy Union.  
219 European Commission, Fourth Report on the State of the Energy Union.  
220 Energy intensity in industry continued to improve by as much as 22% between 2005 and 2017, and 
energy savings have helped offset parts of the impact of these increases. But they have been insufficient to 
maintain total consumption on  a downward trend.  
221 European Commission, Fourth Report on the State of the Energy Union.  
222 European Commission, An EU Strategy on Heating and Cooling. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52016DC0051&from=en . WT/TPR/S/395 • European Union  
 
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  linkages between electricity systems and district heating systems, which will greatly increase the 
use of renewable energy, and encourage reuse of  waste heat and cold generated by industry. 
Legislative provisions for this Strategy are included in the Clean Energy for all Europeans package.  
4.149.   The Commission invited the European Standardization Organizations (ESOs) to contribute to 
the efforts to make Europe more climate -resilient (Section 3.3.2.4).  
Decarbonizing the economy and becoming the world leader in renewable energy  
4.150.   The EU is committed to becoming the world leader  in renewable energy, and the global hub 
for developing the next generation of technically advanced and competitive renewable energies.  The 
Renewable Energy Directive established that a mandatory 20% share of EU energy consumption 
must come from renewables  by 2020.223 In addition, all member States are required to obtain 10% 
of their transport fuels from renewables by that year. The Directive also specifies national renewable 
energy targets for each country , considering its starting point and overall potentia l for renewables. 
These targets range from a low of  10% in Malta to a high of  49% in Sweden.   
4.151.   The 2030 Climate and Energy Policy Framework  points to a renewable energy share of at 
least 30% by  2030. In December 2018, under Directive (EU) No. 2018/2001 of 11 December 2018 
on the promotion of the use of energy from renewable sources224, the EU established  an increased 
EU-wide target of at least 32% by 2030, building on the national target for renewable energy of 
2020.225 Since 2014, the share of renewable energy in the EU energy mix has increased , reaching 
17.5% in 2017 .226 According to the European Commission, w hile the EU is on track to meet its 2020 
targets for renewable energy , member States should step up their efforts to both deploy renewables 
and reduce energy consumption  to ensure that 2030 targets are met.227  
4.152.   According to the Commission , member States may also use statistical transfers, as provided 
for in the Renewable Energy Directive, either to ensure that they achieve the target when there is a 
deficit or to sell their surplus . The Commission  adopted  a revised Renewable Energy Directive  to: 
further deploying ren ewables in the electricity sector; mainstream renewables in the heating and 
cooling sector; decarboni ze and diversify the transport sector (with a renewables target for  2030 of 
at least  14% of total energy consumption in transport); empower and inform cust omers; strengthen 
the EU sustainability criteria for bioenergy; and mak e sure the EU -level binding target is achieved 
on time and in a cost -effective way.228 
                                                
223 Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the 
promotion of the use of energy from renewable sources and amending and subs equently repealing Directives 
2001/77/EC and 2003/30/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32009L0028&from=EN . 
224 Directive (EU) 2018/2001 of the European parliament and of the Council of 11 December 2018 on 
the promotion of the use of energy from renewable sources (recast). Viewed at:  https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32018L2001&from=EN . 
225 EU countries set out how they plan to meet these targets, and the general roadmap for their 
renewable energy policy, in national renewable energy action plans . Progress towards the national targets is 
measured every two years, when countries publish national renewable energy progress reports  in line with the 
governance regulation . 
226 Eurostat, Renewable energy statistics . Viewed at : https://ec.europa.eu/eurostat/statistics -
explained/index.php/Renewable_energy_sta tistics . 
227 European Commission, Fourth Report on the State of the Energy Union.  
228 Proposal for a Directive of the European Parliament and of the Council on the promotion of the use of 
energy from renewable sources (recast). Viewed at:  
https://eur -lex.europa.eu/resourc e.html?uri=cellar:151772eb -b7e9-11e6-9e3c-
01aa75ed71a1.0001.02/DOC_1&format=PDF . WT/TPR/S/395 • European Union  
 
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  4.153.   The EU currently has two targets for biofuels, namely to source 10% of transport fuels from 
renewables by 2020229, and to oblige fuel providers to reduce the GHG intensity of their fuels by 6% 
by 2020.230 The Commission proposed to scrap these two targets after 2020.231  
4.154.   European renewable energy businesses have a combined annual turnover of over 
EUR 130 billion,  and employ more than 1  million people. EU companies have a share of around 40% 
of all patents for renewable technologies. A key challenge is to retain Europe's leading role in global 
investment in renewable energy.232 
4.155.   The full implementation of t he circular economy approach is also critical for decarboni zing 
the EU's economy, notably in energy -intensive sectors such as steel, cement and glass, while 
keeping or increasing its competitiveness. Re use and recycling of raw material s lead to lower 
emissions , and reduce dependency on raw material suppl ies. In December 2018, the Commission 
launched the Circular Plastic s Alliance , consisting  of key industry stakeholders , covering the full 
plastics value chain , as part of its continued  efforts to reduce plastics littering, increase the share of 
recycled plastics , and stimulate market innovation.233 
Promoting research, innovation and competitiveness  
4.156.   The Horizon 2020 (H2020) programme runs from 2014 to 2020 and is the main EU  tool for 
promoting energy research. Funds amounting to EUR 5,9 million hav e been earmarked to support 
the development of clean, secure , efficient  and sustainable energy . It include s EUR  1,6 million for 
the Euratom programme in 2014 -18.234 Horizon Europe,  an ambitious EUR 100 billion research and 
innovation programme,  will replace H2020 as from 2021 and will also have a major climate and 
energy component.235  
4.157.   The European Strategic Energy Technology Plan (SET -Plan), adopted by the  Commission on 
22 November 2007, is aimed at accelerating the market introduction  and take -up of low -carbon and 
efficient energy technologies.  The projected budget for the SET -Plan was estimated at up to 
EUR 71.5 billion .236 
4.158.   According to the Commission , public investment (national and EU) in the Energy Union 's 
research and innovation priorities was  relatively stable throughout 2014 -17, averag ing some  
EUR 5.3 billion a year. With national funding of EUR 4.1 billion on average per year, the H2020 
research programme and cohesion policy funds were essential in keeping research and innovation 
investment steady over the last four years. The Commission aims to invest almost EUR  2 billion in 
2020 in clean energy research and innovation  to meet its commitment to double its public research 
and innovation investment in this area since 2015 as part of its membership of Mission Innovation. 
However, the private sector remains the main provider of such investment, accounting for more 
                                                
229 Directive 2009/28/EC of the European parliament and of the Council of 23 April 2009 on the 
promotion of the use of energy from renewable sources and amending and subsequentl y repealing Directives 
2001/77/EC and 2003/30/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32009L0028&from=EN . 
230 Directive 2009 /30/EC of the European Parliament and of the Council of 23 April 2009 amending 
Directive 98/70/EC as regards the specification of petrol, diesel and gas -oil and introducing a mechanism to 
monitor and reduce greenhouse gas emissions and amending Council Dir ective 1999/32/EC as regards the 
specification of fuel used by inland waterway vessels and repealing Directive 93/12/EEC. Viewed at: 
https://eur -lex.europ a.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:140:0088:0113:EN:PDF . 
231 European Parliament. Renewable energ y. Viewed at: 
http://www.europarl.europa.eu/factsheets/en/sheet/70 /renewable -energy . 
232 European Commission, A Framework Strategy for a Resilient Energy Union with a Forward -Looking 
Climate Change Policy. Viewed at: https://eur -lex.europa.eu/resource.html?uri=cellar:1bd46c90 -bdd4-11e4-
bbe1-01aa75ed71a1.0001.03/DOC_1&format=PDF . 
233 European Commission, Fourth Report on the State of the Energy Union.  
234 Other sources of funding for research, innovati on and competitiveness include the Modernisation 
Fund, the Innovation Fund and the European Strategic Investment Fund. Also, the next multi -annual financial 
framework (MFF) is expected to have a climate mainstreaming objective.  
235 European Commission, Horizon Europe - the next research and innovation framework programme . 
Viewed at: https://ec.europa.eu/info/horizon -europe -next-research -and-innova tion-framework -
programme_en . 
236 Strategic Energy Technologies Information System (SETIS).  What is the SET -Plan?  Viewed at: 
https://setis.ec.europa.eu/about -setis/set -plan-governance . WT/TPR/S/395 • European Union  
 
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  than 75% of EU  investments in clean energy research and innovation, having increased annual 
spending from about EUR 10 billion to over EUR 16 billion within a decade.237 
The EU's v ision for a climate -neutral economy by 2050  
4.159.   In November 2018, the Commission  published its strategic long -term vision  for a prosperous, 
modern, competitive and climate -neutral economy by 2050 as its contribution to the EU 's long -term 
low GHG emission development strategy . The strategy  should be adopted and communicated by 
2020 to the United Nations F ramework Convention on Climate Change, in accordance with the Paris 
Agreement. In parallel, each member State must also prepare its national long -term strategy.238  
4.160.   The Commission  presented this vision not only to keep the global increase in temperature 
well below 2°C compared to pre -industrial levels, but also to pursue efforts to limit this increase to 
1.5°C by achieving net -zero GHG emissions by 2050. To achieve this, the EU must make progress 
on seven strategic building blocks (e nergy efficiency; the deployment of renewables and increased 
electrification; clean, safe, and connected mobility; competitive industry and circular economy; 
infrastructure and inter connections ; bio-economy and natural carbon sinks; and tackling remaining 
emissions with carbon capture and storage ). These building blocks build on the five  dimensions of 
the Energy Union. They also set the direction of travel for EU climate and energy policy to achieve 
the temperature objec tives in the Paris Agreement.239 
4.161.   Achieving the benefits of the 2030 Climate and Energy Policy F ramework will require an 
estimated EUR 180 billion in additional annual investment between 2020 and 2030 (compared to 
the 2016 reference scenario). Reaching climat e-neutrality will require additional investments in the 
range of EUR 142 -199 billion a year between 2030 and 2050 (compared to a baseline with existing 
measures requiring already close to EUR 400 billion in investment each year).240 
4.3  Manufacturing  
4.162.   The EU is a  world leader in manufacturing241, notably in the automotive, mechanical 
engineering, chemicals, pharmaceuticals, and fashion industries. About 17% of total value added in 
the EU -28 comes from the manufacturing sector. The aim is to reach a 20% share of GDP for 
manufacturing by 2020. I t is estimated that one job in manufacturing creates up to 2.5 other jobs 
across the value chain.242 The sector also accounts for some three quarters of the E U-28's 
merchandise exports  (Section 1.3.1) . Moreover, about 80% of priva te-sector R&D expenditure is 
spent in manufacturing, and the sector is closely inter -linked , both upstream and downstream, with 
services.  Therefore, competitiveness in manufacturing influences competitiveness in services, and 
vice-versa.  
4.163.   The manufacturing  sector  comprises some 2.1  million enterprises, most of which are SMEs  
that operate mainly at national level.243 It employs  around 30. 7 million people,  and generat es around 
EUR 2,000 billion of value added  (Table 4.17) . According to the latest available figures, in 2016, 
Germany was the leading contrib utor to the EU -28's total manufacturing value added , with a 2 9.8% 
share, followed by Italy (1 1.8%), France (11.2%), the United Kingdom (1 0.6%), and Spain (5.5%) .  
                                                
237 Public funding will continue to play a key role in coordinating research and steering private 
investment to priorities compatible with the EU's long -term strategic vision. Strong policies and predictable 
price signals are necessary conditions for promot ing innovation in the clean -energy ecosystem, which will 
ultimately boost research investment in clean energy technologies. European Commission, Fourth Report on 
the State of the Energy Union.  
238 European Commission, A Clean Planet for all A European strategic long -term vision for a prosperous, 
modern, competitive and climate neutral economy. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52018DC0773&from=EN . 
239 European Commission, Fourth Report on the State of the Energy Union.  
240 European Commission, Fourth Report on the State of the Energy Union.  
241 The manufacturing sector is  composed of 24 subsectors in the NACE Rev.2 Section C. NACE is the 
acronym for " Nomenclature statistique des activités économique dans la Communauté Européenne ". Industry 
is composed of manufacturing, mining and quarrying, and utilities.  
242 European Commis sion, Industrial Policy Strategy: A holistic strategy and a strong partnership in a 
new industrial age. Viewed at: https://ec.europa.eu/commission/presscorner/detail/en/IP_17_ 3185. 
243 European Parliament. General Principles of EU Industrial Policy . Viewed at: 
http://www.europarl.europa.eu/ftu/pdf/en/FTU_2.4.1.pdf . WT/TPR/S/395 • European Union  
 
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  Table 4.17 Manufacturing ma in indicators, 20 16 
 Number of 
enterprises  Number 
of people  
employed  Turnover  
(EUR 
million)  Value 
added  Personnel 
costs  Apparent 
labour 
produ ctivity  Average 
personnel 
costs  Wage -
adjusted 
labour 
productivity  
(EUR '000 
per head)  Gross 
operating 
rate (%) Investment 
rate 
(%) ('000) (EUR million)  (EUR '000 per head)  
EU-28 2,120.6  30,472.5  7,418,941.6  1,912,370.9  1,154,963.3  63.0 40.1 156.0  10.2 13.6 
Belgium  34.1 494.6  246,308.0  55,191.8  29,245.2  111.6  63.5 175.7  10.5 17.7 
Bulgaria  31.3 549.0  29,457.0  7,135.1  3,286.2  13.0 6.2 208.1  13.1 25.3 
Czech  Rep. 175.4  1,293.7  160,973.3  37,469.3  19,290.7  29.0 17.0 170.6  11.3 20.1 
Denmark  15.2 305.4  111,412.6  33,722.4  19,439.0  110.4  64.9 170.2  12.8 11.0 
Germany  201.8  7,361.0  2,095,634.2  569,863.5  397,179.8  77.4 55.2 140.3  8.2 11.3 
Estonia  7.3 108.9  11,881.5  2,862.7  1,847.2  26.3 17.3 152.3  8.5 20.7 
Ireland  15.6 213.1  215,788.6  86,628.5  10,969.5  406.5  53.2 763.7  35.1 1.8 
Greece  61.9 311.4  46,793.0  10,425.7  5,796.0  33.5 22.8 146.8  9.9 12.4 
Spain  167.0  1,854.9  466,087.9  105,309.8  64,215.9  56.8 36.7 154.6  8.8 15.2 
France  216.0  2,905.6  909,055.4  213,731.6  154,682.6  73.6 55.0 133.8  6.5 14.5 
Croatia  19.5 264.2  20,021.8  5,767.6  3,371.8  21.8 13.3 164.3  11.9 17.6 
Italy 387.9  3,662.3  889,271.7  224,944.7  135,864.1  61.4 42.8 143.6  10.0 13.1 
Cyprus  5.0 29.7 3,044.2  962.8  566.8  32.4 20.2 160.1  13.0 10.2 
Latvia  11.1 119.5  7,686.1  2,156.3  1,197.2  18.0 10.4 172.9  12.5 19.8 
Lithuania  20.0 214.6  18,114.5  4,213.0  2,328.8  19.6 11.3 173.6  10.4 19.4 
Luxembourg  0.8 33.6 13,232.8  3,118.2  1,914.6  92.8 57.3 162.0  9.1 12.9 
Hungary  50.0 739.1  102,005.2  21,785.1  10,263.3  29.5 14.4 204.5  11.3 26.8 
Malta  2.2 22.6 2,451.8  707.0  392.6  31.3 18.5 169.3  12.8 24.1 
Netherlands  65.2 686.2  322,255.0  67,208.2  37,287.1  97.9 57.9 169.1  9.3 11.8 
Austria  25.0 629.1  181,005.4  54,390.3  34,843.3  86.5 57.2 151.3  10.8 12.3 
Poland  196.1  2,584.4  288,672.3  64,219.7  30,435.2  24.8 12.8 193.7  11.7 22.8 
Portugal  67.0 686.7  82,103.9  20,136.0  11,594.7  29.3 17.7 165.4  10.4 22.7 
Romania  48.3 1,209.8  75,169.5  16,943.8  10,125.8  14.0 8.5 165.5  9.1 33.8 
Slovenia  19.1 197.0  26,387.8  7,651.9  4,623.7  38.8 24.9 155.7  11.5 18.5 
Slova k Rep.  68.4 478.9  72,080.5  12,901.4  7,121.1  26.9 16.9 159.7  8.0 27.6 
Finland  20.3 332.3  121,792.4 26,983.5  16,641.1  81.2 51.9 156.4  8.5 12.1 
Sweden  53.8 595.3  197,908.3  53,528.4  34,274.8  89.9 64.0 140.6  10.3 14.0 
United 
Kingdom  135.4  2,589.7  702,346.8  202,362.3  106,165.1  78.1 41.6 188.0  13.7 14.5 
Source:  Eurostat, Manufacturing statistics – NACE Rev. 2 . Viewed at:  
https://ec.europa.eu/eurostat/statistics -explained/index.php/Manufacturing_statistics_ -
_NACE_Rev._2 . 
4.164.   On average, manufacturing value added in the EU -28 grew 23.0% in real terms between 
2009 and 2016.244 This was  mainly due to the growth of manufacturing of motor vehicles, trailers 
and semi -trailers245, the single largest EU -28 subsector in terms of value added, with an 11.0% 
share in 2016, followed by machinery and equipment (10.8%), and food products (10.1%). The 
manufacture of food products was the biggest employer, with a 14.0% share in 2016.246  
4.165.   The sector's apparent labour productivity ( value  added per person employed ) was 
EUR 63,000 per person in 2016, while the average pe rsonnel costs amounted to  EUR 40,100 per 
employee . Among the EU member States, the highest apparent labour productivity in 2016 was 
recorded in Ireland (EUR 406,500 per person employed), while the lowest was in Bulgaria 
(EUR 13,000) (Table  4.17).  
4.166.   Average personnel costs ranged from over EUR 50,000 per emp loyee in Austria, Belgium, 
Denmark, Finland, France, Germany, Ireland, the Netherlands, Luxembourg, and Sweden, to below 
EUR 10,000 per employee in Bulgaria and Romania. Combining these two indicators gives the 
wage -adjusted labour productivity ratio, whic h is a measure of labour productivity that takes account 
the very different levels of pay and social charges between member States and activities. The highest 
such ratio was recorded in Ireland (763.7%) and the lowest was in France (133.8%).  An analysis of  
the EU -28's gross operating rate (share of operating surplus in turnover ) gives an idea of the 
                                                
244 European Commission, Investing in a smart, innovative and sustainable Industry A renewed EU 
Industrial Policy Strategy . Viewed at: https://ec.europa.eu/transparency/regdoc/rep/1/2017/EN/COM -2017-
479-F1-EN-MAIN -PART-1.PDF . 
245 The Slovak Republic stood out with the manufacturing of mot or vehicles, trailers and semi -trailers 
and other transport equipment which represented 43% of the country's total value of sold production, followed 
by the Czech Republic (33%) and Hungary (29%). Eurostat. Industrial production statistics . Viewed at: 
https://ec.europa.eu/eurostat/statistics -explained/index.php/Industrial_production_statistics . 
246 Eurostat, Manufacturing statistics – NACE Rev. 2 . Viewed at: 
https://ec.europa.eu/eurostat/statistics -explained/index.php/Manufacturing_statistics_ -_NACE_Rev._2 . WT/TPR/S/395 • European Union  
 
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  operating profit before depreciation charges. Ireland had the highest such ratio (35.1%) while France 
recorded the lowest (6.5%) (Table 4.17).  
4.167.   Manufacturing sub sectors are very diverse, combining activities with relatively low apparent 
labour productivity and average personnel costs, such as wearing apparel, leather products, 
furniture, wood and products of wood and cork, and textiles, with other activities that have 
considerably higher values for the same indicators, such as coke and refined petroleum products, 
tobacco manufacturing, basic pharmaceutical products and pharmaceutical preparations, and 
chemicals. Basic pharmaceutical products and pharmaceutical prep arations was the most profitable 
of the manufacturing activities , with a 22.0% gross operating rate in 2016, while the least profitable 
was coke and refined petroleum products (5.1%), explained, in part, by the capital -intensive nature 
and high turnover of  this transformation activity.247 
4.168.   In 201 6, some 5 8.6% of the sector 's value added was generated by 16,100 large enterprises 
(employing 250 or more people ), and these employed 4 2.4% of the manufacturing workforce. The 
contribution of large enterprises was con centrated in the manufacture of coke and refined petroleum 
products, of motor vehicles, trailers and semi -trailers, of tobacco products, and of other transport 
equipment. Among the EU member States  the relative importance of large enterprises was greatest 
in Ireland (8 5.6%).  
4.169.   The contribution  of medium -sized enterprises (employing 50 to 249 persons) to value added 
in 201 6 was highest in the textiles, rubber and plastic products, fabricated metal products and 
machinery , and paper and paper products subsector s. Medium -sized enterprises made a 
considerable contribution to manufacturing value added in Latvia,  with 4 3.7% of the total value 
added.  In none of the manufacturing subsectors did small enterprises (employing 10 to 49 people) 
or micro enterprises (employ ing fewer than 10 people ) contribute the largest share of value added 
among the four size classes.248 
4.170.   Several policies, programmes and initiatives, covering a wide variety of fields, contribute to 
EU industrial policy. Examples of initiatives with a budget envelope include249: the ESIF ( six funds 
worth EUR 450  billion in 2014-20) (Section 3.3.1.1) ; Horizon 2020 (EUR 77 billion in 2014-20); the 
CEF (EUR 30.4 billion in 2014 -20)250; and the programme for the COSME (over EUR 2 billion until 
2020). In additio n, the Investment Plan for Europe and the EFSI aim to mobili ze at least 
EUR 408.4  billion in private and public investment by 2020. Two recurring priorities across these 
programmes and initiatives are SMEs and innovation.251 
4.171.   Under Article 173 of the TFEU, industrial policy aims a t: speeding up the adjustment of 
industry to structural changes;  encouraging an environment favourable to initiative and to the 
development of  enterprises, particularly SMEs ; encouraging an environment favourable to 
cooperation betw een undertakings;  and fostering better exploitation of the industrial potential of 
policies of innovation,  research and technological development.  
4.172.   In March 2010, the Europe 2020  (Section 1.2.5)  strategy was launched to enhance the 
competitiveness of the EU  and to create more growth and jobs. It put forward seven flagship 
initiatives, four of which are especially relevant to making manufacturing more competitive: 
                                                
247 Eurostat, Manufacturing Stati stics – NACE Rev.2.  
248 Eurostat, Manufacturing Statistics – NACE Rev.2.  
249 European Commission, Industrial Policy Strategy: Making Europe's industry stronger. Key initiatives. 
Viewed at: https://ec.europa.eu/commission/presscorner/detail/en/IP_17_3185 . 
250 The CEF is a fund for pan -European infrastructure  investment in transport, energy and digital 
projects which aim at greater connectivity between EU member States. It operates thr ough grants, financial 
guarantees and project bonds.  
251 European Commission, Investment Plan results . Viewed at: 
https://ec.europa.eu/commission/priorities/jobs -growth -and-investment/investment -plan-europe -juncker -
plan/investment -plan-results_en . WT/TPR/S/395 • European Union  
 
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  "Innovation Union"252; "A digital agenda for Europe"253; "An industrial policy for the globalisation  
era"254; and "New Skills for New Jobs ".255 
4.173.   On 14 October 2011,  the "Industrial Policy: Reinforcing competitiveness " was adopted.256 It 
calls for deep structural reforms and coherent and coordinated policies across member States  to 
enhance economic and industria l competitiveness and foster long -term sustainable growth. It also 
points out several key areas in which greater effort is needed: structural change in the economy; 
the innovativeness of industries; sustainability and resource efficiency; the business envi ronment; 
the single market; and  SMEs .257 
4.174.   On 10 October 2012, "A Stronger European Industry for Growth and Economic Recovery — 
Industrial Policy Communication Update " was launched.258 It aims at supporting investment in 
innovation, with a focus on six priority areas (advanced manufacturing technologies for clean 
production; key enabling technologies; bio -based products; sustainable industrial and construction 
policy and raw materials; clean vehicles and vessels; and smart grids). This communication also  
highlighted the need for better market conditions, access to finance and capital, and human capital 
and skills, as means of promoting industrial competitiveness.  
4.175.   In January 2014, the policy " For a European Industrial Renaissance " was launched .259 
It focuses  on reversing industrial decline and reaching the target of 20% of GDP for manufacturing 
activities by 2020. According to the Commission, t o attract new investments and create a better 
business environment, the EU needs more coherent policies in the field of the internal market, 
including infrastructure such as energy, transport and information networks, as well as for goods 
and services. The importance of improved cooperation in the areas of good quality public 
administration, trade, research and raw mater ials is also mentioned.260 
4.176.   This policy was complemented in 2016 by "Digitising European Industry : Reaping the full 
benefits of a Digital Single Market ", which focuses on digital transformation and addresses related  
challenges such as funding, ICT standardi zation, big data and skills.261 Moreover, the  Start-up and 
Scale -up Initiative , launched in 2016 , aims to give  Europe 's many innovative entrepreneurs every 
opportunity to build world -leading  companies.262 
4.177.   In September 2017, a renewed EU Industrial Policy Strateg y, "Investing in a smart, 
innovative and sustainable industry", was outlined  to bring together all existing and new horizontal 
and sector -specific initiatives into a comprehensive strategy. Some  of its main elements  include263: 
• a package to reinforce the industry's  cybersecurity. It includes the creation of a European 
Cybersecurity Research and Competence Centre to support the development of technology 
                                                
252 European Commission, Europe 2020 Flagship Initiative Innovation Union . Viewed at: 
https://ec.europa.eu/research/innovation -union/pdf/innovation -union -communication_en.pdf . 
253 European Commission,  A Digital Agenda for Europe.  Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0245:FIN:EN:PDF . 
254 European Commission, An Integrated Industrial Policy for the Globalisation Er a Putting 
Competitiveness and Sustainability at Centre Stage . Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0614:FIN:EN:PDF . 
255 European Commission,  New Skills for New Jobs Anticipating and matching labour market and skills 
needs. Viewed at: https://eur -lex.europa.eu/LexUriServ/LexUriServ.do ?uri=COM:2008:0868:FIN:EN:PDF . 
256 European Commission, Industrial Policy: Reinforcing competitiveness.  Viewed at: https://eur -
lex.europa.eu/LexUriServ/LexUriServ .do?uri=COM:2011:0642:FIN:EN:PDF . 
257 European Parliament, General Principles of EU Industrial Policy . Viewed at: 
http://www.europarl.europa.eu/ftu/pdf/en/FTU_2.4.1.pdf . 
258 European Commis sion, A Stronger European Industry for Growth and Economic Recovery. Viewed at: 
https://eur -lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2012:0582:FIN:EN:PDF . 
259 European Commission, For a European Industrial Renaissance . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52014DC0014&from=EN . 
260 European Parliament, General Principles of EU Industrial Policy.  
261 European Commission, Digitising European Industry - Reaping the full benefits of a Digital Single 
Market . Viewed at: https://ec.europa.eu/transparency/regdoc/rep/1/2016/EN/1 -2016-180-EN-F1-1.PDF . 
262 European Commission, Europe's next leaders: the Start -up and Scale -up Initiative . Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52016DC0733&from=EN . 
263 European Commission, State of the Union 2017 - Industrial Policy Strategy: Investing smart 
innovative and sustainable  industry. View ed at: https://ec.europa.eu/growth/content/state -union -2017-
%E2%80%93 -industrial -policy -strategy -investi ng-smart -innovative -and-sustainable_en . WT/TPR/S/395 • European Union  
 
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  and industrial capabilities in cybersecurity, as well as an EU -wide certificati on scheme for 
products and services, recognized in all member States  (Section 4.4.5.1.1) ; 
• a proposal for a regulation on the free flow of non -personal data  that will enable data 
to circulate freely across borders, helping to modernize industry and create a  truly 
common European data space  (Section 4.4.3.1) ; 
• a new series of actions on circular economy, including a strategy on plastics  and measures 
to improve the production of renewable biological resources  and their conversion into 
bio-based products and bio -energy ; 
• a set of initiatives to modernize the intellectual property (IP) framework, including a report 
on the functioning of the Directive on the enforcement of intellectual property rights ( IPRs) 
and a communication on a balanced, clear and predictable E uropean licensing framework 
for standard essential patents  (Section 3.3.7) ; 
• an initiative to improve the functioning of public procurement  in the EU, including a 
voluntary mechanism to provide clarity and guidance to authorities planning large 
infrastructu re projects  (Section 3.3.6) ; 
• extension of the skills agenda  to new key industry sectors, such as construction, steel, 
paper, green technologies and renewable energies, manufacturing and maritime shipping ; 
• a strategy on sustainable finance  to better orient private capital flows to more 
sustainable investments  (Section 4.4.1.2.3.4) ; 
• initiatives for a balanced and progressive trade policy  and a European framework for the 
screening of FDI that may pose a threat to security or public order  (Section 2.4.2.1) ; 
• a revised list of critical raw materials  where the Commission will continue to help ensure 
the secure, sustainable and affordable supply for the EU manufacturing industry ; and  
• new proposals for clean, competitive and connected mobility , including tightened CO2 
emissions standards for cars and vans, an Alternative Fuels Infrastructure Action Plan to 
support the deployment of charging infrastructure, and foster autonomous driving  (see 
below) . 
4.178.   The European Council adopted Conclusions on 22 March 2019 inviting t he Commission to 
"present, by the end of 2019, a long -term vision for the EU 's industrial future, with concrete 
measures to implement it. It should address the challenges European industry faces, touching upon 
all relevant policy areas ". 
4.179.   Additionally, foll owing up on previous Council Conclusions, on 27 May 2019, the 
Competitiveness Council adopted "An EU Industrial Policy Strategy: Vision 2030"264, reiterating the 
Council 's call for a comprehensive and long -term EU industrial policy strategy with a clear visi on for 
2030 and stress ing the importance of mobili zing all EU policies to strengthen the competitiveness of 
EU industry. Weakness in the manufacturing sector has contributed to the slowdown of GDP growth 
since the second half of 2018 (Section 1.1).  
4.180.   Under i ts renewed Industrial Policy Strategy, the EU also aims to increase the exploitation 
of key enabling technologies (KETs), and to reverse the decline in KETs -related manufacturing and 
patents being exploited outside the EU, as this will stimulate growth and  jobs. Currently, there is a 
group of six KETs265: materials and nanotechnology ; photonics and micro - and nano -electronics ; life 
                                                
264 Council of the European Union, An EU Industrial Policy Strategy: a Vision for 2030. Viewed at: 
https://www.consilium.europa.eu/media/3950 7/st09706 -en19.pdf . 
265 European Commission, Re -Finding Industry. Report from the High -Level Strategy Group  on Industrial 
Technologies. Viewed at: 
https://ec.europa.eu/research/industrial_technologies/pdf/re_finding_industry_022018.pdf . WT/TPR/S/395 • European Union  
 
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  sciences technologies ; AI; digital security ; and connectivity . The Strategy is complemented by 
sector -specific measures, such as those in the automotive industry.266 
4.181.   On the basis of ISIC (Revision 2), MFN customs tariffs on manufactured imports average 
6.2%, with rates ranging up to 162.9 % on certain food products. Some non -ad valorem  tariffs 
(i.e. compound, mixed, or other) apply to manufacturing products and, therefore, it is often difficult 
to determine the duty rate and calculate the real tariff impact in such cases (Section 3.1.3.2) . 
Automotive  
4.182.   The EU is the second -largest automotive production region in the world  (in volume), and the 
industry represents the largest private investor in R&D in the EU. The automotive industry provides 
jobs for some 12 million people (3 million in manufacturing, 4.3 million in maintenance and 
4.8 million in transport , i.e. about 11% o f the EU's manufacturing employment ) and accounts for 
4% of GDP. It also has an important multiplier effect on the economy, being key for upstream 
industries (e.g. steel, chemicals and textiles ), as well as downstream ones (e.g. ICT, repair, and 
mobility s ervices ).267 
4.183.   Traditionally, the EU-28 has enjoyed a trade surplus in cars (EUR 81.5 billion in 20 18, with 
EUR 127.7  billion in exports , or 7% of total merchandise exports, and EUR 46.2 billion in imports ). 
In 2018, the United States was the main export desti nation for the EU's cars (29% of the total), 
followed by China (17%) and Japan (7%). Japan was the main origin of imports, with a 22% share, 
followed by Turkey (19%) and the Republic of Korea (15%).  Germany is the EU's largest exporter 
of cars (55.0% of th e total in 2018), followed by the United Kingdom (17.3%). For most member 
States, imports of cars made up less than 3% of their total import of goods. Only three countries 
had higher shares: Slovenia (15.2%), Belgium (7.4%), and Germany (3.5%) ( Table 4.18 ).268 
Table 4.18 Trade in cars, 2018  
 Extra -EU trade (EUR million)  Share in EU trade (%)  Share in total trade  
(%) 
 Export  Import  Balance  Export  Import  Export  Import  
EU-28 127,745  46,212  81,533  100.0  100.0  6.5 2.3 
Belgium  2,550  10,074  -7,523  2.0 21.8 2.4 7.4 
Bulgaria  46 140 -95 0.0 0.3 0.5 1.2 
Czech Rep . 3,086  271 2,815  2.4 0.6 11.5 0.7 
Denmark  98 220 -122 0.1 0.5 0.3 0.8 
Germany  70,251  12,965  57,286  55.0 28.1 13.0 3.5 
Estonia  5 42 -37 0.0 0.1 0.1 1.1 
Ireland  4 196 -192 0.0 0.4 0.0 0.6 
Greece  4 171 -167 0.0 0.4 0.0 0.6 
Spain  4,284  3,807  477 3.4 8.2 4.3 2.8 
France  3,241  4,327  -1,086  2.5 9.4 1.6 2.5 
Croatia  29 36 -7 0.0 0.1 0.6 0.7 
Italy 6,845  4,260  2,585  5.4 9.2 0.1 2.4 
Cyprus  3 92 -88 0.0 0.2 0.1 2.4 
Latvia  10 10 0 0.0 0.0 0.2 0.2 
Lithuania  88 135 -47 0.1 0.3 0.8 1.4 
Luxembourg  7 10 -3 0.0 0.0 0.3 0.4 
Hungary  1,070  188 882 0.8 0.4 5.5 0.7 
Malta  1 33 -32 0.0 0.1 0.1 2.2 
Netherlands  540 1,087  -547 0.4 2.4 0.3 0.4 
Austria  1,676  306 1,371  1.3 0.7 3.7 0.8 
Poland  695 418 277 0.5 0.9 1.6 0.6 
                                                
266 European Commission, Industrial Policy Strategy: Making Europe's industry stronger. Key initiatives.  
267 With motor vehicle production of around 16 million units (18.1 million units in 2006), the EU -28 
share in world production went from 27% in 2006 to 25% in 2017, largely due to increased production in other 
countries. European Commission (2017), GEAR 2030 Strategy 2015 -2017: Comparative analysis of the 
competitive position of the EU automotive industry and the impact of the introduction of autonomous vehicles , 
Brussels.  
268 Cars dominate trade in motor vehicles an d related products, with a 64% and 52% share of total 
EU export and imports in 2017, respectively. The value of extra -EU exports of cars increased by an annual 
average of 5.6% between 2012 and 2017, while imports grew at an average of 5.4% per year. Eurost at, 
International trade in cars . Viewed at: https://ec.europa.eu/eurostat/statistics -
explained/index.php?title=International_trade_i n_cars&oldid=396479 . WT/TPR/S/395 • European Union  
 
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   Extra -EU trade (EUR million)  Share in EU trade (%)  Share in total trade  
(%) 
 Export  Import  Balance  Export  Import  Export  Import  
Portugal  237 263 -26 0.2 0.6 1.7 1.4 
Romania  668 251 417 0.5 0.5 4.3 1.2 
Slovenia  510 1,782  -1,272  0.4 3.9 5.7 15.2 
Slovak  Rep. 5,164  37 5,127  4.0 0.1 45.2 0.2 
Finland  246 241 5 0.2 0.5 0.9 1.2 
Sweden  4,266  685 3,581  3.3 1.5 7.5 1.6 
United 
Kingdom  22,120  4,166  17,954  17.3 9.0 10.2 1.5 
Source:  Eurostat, International trade in cars . Viewed at: https://ec.europa.eu/eurostat/statistics -
explained/index.php?title=International_trade_in_cars&oldid=396479 . 
4.184.   Since some 80% of the growth in the automotive sector is expected to come from outside 
the EU, cost leadership and a continued lead in new technology areas will become more important 
if the EU is to maintain and grow its future market share. One key contributor to competitivene ss in 
the future will be the evolution of the regulatory environment , both within and outside the EU.  The 
strict regulation in the EU ensures that the automotive industry continues to develop sustainable, 
high-quality, technologically -advanced products, wh ile being in a strong position of regulatory 
leadership from the point of view of both protecting the internal market and maximi zing 
opportunities to access external markets.269 
4.185.   The EU's work towards a clean, sustainable and competitive automotive  industry  
encompasses a wide range of policy areas and initiatives : ensuring that emissions legislation is 
respected, introducing more robust and accurate emissions tests, proposing a full overhaul of the 
type approval system, promoting a shi ft to zero -emissions vehi cles, and fostering connected mobility 
solutions, equipment and vehicles and a modern infrastructure to support them .270 
4.186.   The EU automotive industry is trying to maintain its competitiveness on the global stage in 
the face of strong competition from manufacturers in both developed and emerging economies and 
given the  demands from society with respect to mobility and transport. Issues which are likely to 
affect the industry going forward include271: 
• changes in car ownership levels, both an increase in car ownership in emerging markets 
as purchasing power increases and a potential decrease in developed markets as mobility 
as a service and car -sharing schemes take an inc reasing market share ;  
• strengthening regulations on both safety and environmental impact from all major 
markets, with emerging markets rapidly catching up to the EU industry 's leading position 
in these fields ; 
• a significant shift towards e lectro mobility, as nations across the world move towards 
reducing their environmental impact (e.g. GHG) and as cities aim to tackle increasing air 
pollution levels ;  
• the rising  connectivity of vehicles and the advent of autonomous driving. This has 
wide-ranging implicatio ns for the automotive industry, from potentially significantly 
reduced vehicle sales and ownership levels to new business models, but perhaps most 
importantly the gradual merging of the automotive, ICT and telecommunications 
industries ;  
• the introduction o f a large number of innovative, low -cost, small vehicles (e.g. e -scooters), 
providing mobility solutions  in urban areas , particularly in emerging markets, as these 
become more crowded and polluted with the global urbani zation of the population ; and 
                                                
269 European Commission, GEAR Strategy 2015 -2017; Comparative analysis of the competitive position 
of the EU automotive industry and the impact of the introduction of autonomous vehicles. Viewed at: 
https://ec.europa.eu/growth/content/final -report -gear-2030-strategy -2015-2017_en . 
270 European Commission, Industrial Policy Strategy: Making Europe's industry stronger. Key initiatives.  
271 European C ommission, GEAR Strategy 2015 -2017; Comparative analysis of the competitive position 
of the EU automotive industry and the impact of the introduction of autonomous vehicles.  WT/TPR/S/395 • European Union  
 
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  • concern that some of the differentiators that European vehicle manufactures have 
enjoyed, such as leading performance on comfort, environmental impact and safety, are 
declining as other manufacturers (particularly from emerging markets) gain ground in 
these  areas . 
4.187.   Tariff protection for motor vehicles (HS 87) in the EU averages 6.7 %, ranging up to 22%. 
Chemicals  
4.188.   Until recently, the EU was the world's leading chemicals producer, having gradual ly lost  its 
top spot to Asia n countries , notably China. The EU share  of world chemicals sales went down from 
30.9% in 2004 to around  15.6% currently .272 Nonetheless, t he EU -28 still is the world's largest 
exporter of chemical products ( EUR 355.8 billion in 201 8), with the highest trade surplus 
(EUR 152.2 billion in 201 8). The United States, Switzerland and China,  together, account for around 
40% and 60% of the EU-28's total exports and imports of chemicals, respectively.273 
4.189.   The EU -28's chemicals gross value added and gross output (turnover) amount to around 
EUR 120 billion  and EUR 500 billion, respectively . The chemical industry is capital intensive but still 
employs  1.2 million persons (4% of manufacturing workers) and, with total sold production of 
EUR 674 billion in 2017 , is one of the biggest industrial sectors i n the EU , and an important source 
of direct and indirect employment in many regions. It accounts for over 7% of manufacturing output , 
comprising some 27,000 enterprises, 96% of which are SMEs . Moreover, its activities directly affect 
downstream chemicals u sers, with the largest industrial customers being the rubber and plastics, 
construction , and automotive sector s.274 
4.190.   The largest product group in chemicals is medical and pharmaceutical products, with about 
a quarter of the EU -28's total sold production in 20 17. Similarly, medical and pharmaceutical 
products contributed 46% and 41% to the EU -28's total chemical exports and imports, 
respectively.275 
4.191.   Germany, the largest chemicals producer in Europe, together with France, Italy, and the 
United Kingdom, produce abo ut 60% of the E U-28's chemicals output. In 2018, Ireland had the 
highest trade surplus in chemicals and related products of any EU member State (EUR 65.5 billion, 
up from EUR 35.8 billion in 2008), followed by Germany, the Netherlands, and Belgium. Poland had 
the highest trade deficit in chemicals and related products (EUR 10.8 billion in 2018), followed by 
Spain and Romania ( Table 4.19 ).  
Table 4.19 Trade in chemicals and related products (SITC 5), 2008  and 20 18 
(EUR million ) 
 Exports  Imports  Trade balance  
 2008  2018  2008  2018  2008  2018  
EU-28 197,607.6  355,848.3  124,287.2  203,622.3  73,320.5  152,226.0  
Belgium  90,221.5  121,125.3  71,531.8  96,654.1  18,689.7  24,471.2  
Bulgaria  1,209.4  2,840.1  2,195.3  4,500.6  -985.9  -1,660.5  
Czech Republic  5,978.1  10,519.3  9,921.7  17,223.8  -3,943.5  -6,704.4  
Denmark  10,226.8  19,763.9  8,205.9  10,654.5  2,020.9  9,109.5  
Germany  140,848.7  216,674.2  102,619.3  158,631.2  38,229.4  58,042.9  
Estonia  535.4  918.1  1,149.8  1,847.7  -614.4  -929.6  
Ireland  44,095.3  85,698.3  8,276.2  20,182.8  35,819.2  65,515.5  
Greece  2,421.8  3,500.3  8,638.2  7,996.5  -6,216.3  -4,496.1  
Spain  24.662.7  39,361.8  34,146.9  47,527.6  -9,484.2  -8,165.8  
France  73,431.2  91,722.2  61,872.4  75,390.8  11,558.8  16,331.4  
Croatia  944.8  1,845.5  2,203.4  3,334.6  -1,258.6  -1,489.0  
Italy 37,085.4  60,812.2  47,481.8  67,193.2  -10,396.4  -6,381.0  
                                                
272 European Commission, Impacts of REACH and corresponding legislation governing th e conditions for 
marketing and use of chemicals in different countries/regions on international competitiveness of EU industry. 
Viewed at: https://op.europa.eu/en/publication -detail/ -/publication/67415a33 -aafe-11e6-aab7-01aa75ed71a1 . 
273 Eurostat. Production and international trade in chemicals . Viewed at: 
https://ec.europa.eu/eurostat/statistics -
explained/index.php/Production_and_international_trade_in_chemicals . 
274 CEFIC. Estimations by CEFIC for 2017 - Facts & Figures of the European chemical industry . Viewed 
at: https://cefic.org/app/uploads/2018/1 2/Cefic_Facts And_Figures_2018_Industrial_BROCHURE_TRADE.pdf . 
275 Eurostat. Production and international trade in chemicals.  WT/TPR/S/395 • European Union  
 
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   Exports  Imports  Trade balance  
 2008  2018  2008  2018  2008  2018  
Cyprus  188.3  388.5  637.9  755.7  -449.6  -367.1  
Latvia  631.6  1,235.4  1,302.2  1,978.0  -670.6  -742.6  
Lithuania  2,199.4  4,266.6  2,433.9  4,603.6  -234.6  -337.0  
Luxembourg  817.4  1,670.8  1,713.6  2,486.4  -896.2  -815.6  
Hungary  6,122.0  12,959.3  7,296.6  13,016.4  -1,170.6  -57.1 
Malta  220.8  357.0  347.2  537.3  -126.4  -180.3  
Netherlands  60,456.7  104,975.0  44,698.3  69,428.0  15,758.4  35,547.0  
Austria  13,116.3  20,256.8  13,653.0  21,555.5  -536.7  -1,298.6  
Poland  9,105.2  19,928.6  18,512.5  30,708.0  -9,407.2  -10,779.4  
Portugal  2,971.0  4,985.8  6,952.1  10,230.3  -3,981.1  -5,244.5  
Romania  2,059.6  2,872.7  6,212.5  10,432.4  -4,152.9  -7,559.7  
Slovenia  3,119.8  5,581.6  2,794.3  5,086.2  325.5  495.4  
Slovak Republic  2,280.7  3,427.7  4,279.7  6,558.1  -1,999.1  -3,130.4  
Finland  4,009.3  6,119.4  6,126.9  7,586.1  -2,117.6  -1,466.7  
Sweden  13,651.5  16,837.2  12,810.0  15,579.7  841.5  1,257.5  
United Kingdom  54,880.7  62,046.5  48,584.5  65,945.0  6,296.2  -3,898.5  
Source:  Eurostat , International trade of chemicals and related products (SITC 5) , by reporting country . 
Viewed at: https://ec.europa.eu/eurostat/databrowser/view/tet00008/default/table?lang=en . 
4.192.   The EU's horizontal and principal regulation concerning chemicals is the Registration , 
Evaluation, Authorisation and Restriction of Chemicals  (REACH ). In addition, there is the 
Classification, Labelling and Packaging of Substances and Mixtures  (CLP), and vertical regulations 
for specific families of products, such as fertilizers, pesticide s and biocides, detergents, explosives, 
pyrotechnic articles, drug precursors, pharmaceuticals, cosmetics, and food contact materials, or for 
specific areas, such as the workplace (workers' legislation framework and related directives on 
chemicals ), indust ry (Industrial Emissions Directive) and air (Ambient Air Quality Directive).  
4.193.   REACH entered into force on 1 June 2007 and its provisions were phased  in over 11 years. 
It aims at ensuring  a high level of protection of human health and the environment from th e risks 
that can be posed by chemicals, promoting alternative methods to assess the hazards of substances, 
the free circulation of substances on the internal market, and the enhancement of competitiveness 
and innovation in the EU chemical industry.  It give s greater responsibility to the industry to manage 
the risks from chemicals and to provide safety information on the substances , and calls for the 
progressive substitution of the most hazardous  chemicals when suitable alternatives exist.  By 
providing knowl edge about the hazardous properties of chemicals and appropriate safety 
information, REACH aims to enhance the communication and implementation of conditions of safe 
use in the supply chains and the substitution of hazardous substances by less dangerous on es. In 
addition, through different types of measures on substances of very high concern, REACH seeks to 
reduce the risks to human health and  the environment at the EU level.276 
4.194.   The European Chemical Agency (ECHA), established under REACH  and operational since 
June 2008, is tasked to, inter alia , ensure the consistent application of REACH , and to manage the 
database of all registered chemicals. Key elements of REACH include increasing the threshold for 
registering new substances from 10  kg to 1  tonne, and the maximum time -limit for exemption from 
registration for R&D from 6 to 15 years. EU manufacturers and importers are required to gather 
information on the properties of their chemical substances, and to register the information in a 
central da tabase run by the ECHA in Helsinki.  The direct costs of REACH to the chemicals industry 
of testing and registering were  estimated at EUR 2.3 billion for the first two registration deadlines .277  
4.195.   According to the 2018 REACH Review, more information on the pro perties and uses of 
chemicals is now available and  is being used for the assessment and management of risks, indicating 
that REACH is progressively improving the protection of human health and the environment in the 
EU. The Review found that benefits are s tarting to materiali ze, with an estimated scale in the order 
of EUR 100 billion over 25 -30 years. The Review further identified a number of shortcomings and 
room for improvement in relation to the high level of non -compliance of registration dossiers, the 
insufficient flow of information along the supply chain, the need to simplify the overall authori zation 
                                                
276 European Commission, Commission General Report on the operation of REACH and review of certain 
elements . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52018DC0116&from=EN . 
277 European Commission, Extended Impact Assessment of REACH . Viewed at:  
http://ec.europa.eu/environment/chemicals/reach/pdf/background/impact_on_environment_report.pdf . WT/TPR/S/395 • European Union  
 
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  process , and the need to ensure a level playing field between EU and non -EU companies through 
effective restrictions and enforcement .278 Following the Review, and in cooperation with member 
States and the ECHA, the Commission proposed a number of actions intended to improve 
implementation and reduce burdens in relation to e.g. compliance of registration dossiers, the 
extended Safety Data Sheets, and the pro cess to apply for authori zation and restriction – without 
incurring reductions in the level of protection of human health and the environment.279 
4.196.   When REACH was adopted, attention was paid to ensure that domestic and foreign 
businesses manufacturing or impor ting chemicals into the EU were treated equally. However, third 
countries have repeatedly raised concerns in the WTO T BT Committee that REACH would create 
barriers to trade and benefit the chemicals industry in the EU over foreign competitors.280 According 
to the Commission, however, there is no evidence that this is the case.  
4.197.   MFN tariffs on in organic  chemicals (HS 28) and organic  chemicals (HS 29) average 4.2% 
and 4.5%, respectively, with rates ranging up to 5.5% and 39.2%, respectively .  
4.198.   Some of the E U's applied anti -dumping duties and countervailing measures are on chemical 
products (Section 3.1.6.1).  
Steel  
4.199.   The EU's steel industry is world -leading in certain steel product segments, and represents 
1.3% of GDP. Closely integrated with the manufacturing and construction industries, steel is the 
backbone for development, growth and employment in the EU . It is the mos t versatile industrial 
material in the world . It is 100% recyclable , and therefore is a fundamental part of the circular 
economy. As a basic engineering material, it is also an essential factor in the development and 
deployment of innovative, CO2-mitigatin g technologies, improving resource  efficiency , and fostering 
sustainable development.281 
4.200.   Gross Value Added (GVA) of the EU steel industry reached EUR 148 billion in 201 8, if direct, 
indirect and induced effects are factored in. The GVA per worker is around 11% above the average 
for the overall EU economy, and some 7% higher than that of the wider EU  manufacturing sector.282 
The EU steel sector 's total value of turnover (sale s) amounted to EUR 123 billion in 2017, six times 
the industry 's direct GVA, and larger than comparable manufacturing industries. Due to substantial  
capital requirements, large companies tend to dominate the industry. Counting direct, indirect and 
induced employment, the EU industry supports nearly some 2. 6 million jobs.283 
4.201.   In 201 8, the EU produced around 16 7 million tonnes of steel ( down  from 16 9 million tonnes 
in 201 4), led by Germany,  with a 2 5.3% share, Italy (14. 6%), France (9.2%), and Spain (8.5%)  
(Table 4.20 ). The EU is a net importer of steel , with imports of 29.3 million tonnes in 2018 and 
exports of 20.6 million tonnes  in 2018 . Excluding semi -finished  goods , import levels re ached a record 
high in 2018, with EU's exports continuing the decline that be gan in 2014.284 
                                                
278 European Commission, Commission General Report on the operation of REACH and review of certain 
elements.  
279 European Commission, Commission General Report on the operation of REACH and review of certain 
elements.  
280 European Commission, Impacts of REACH and corresponding legislation governing the conditi ons for 
marketing and use of chemicals in different countries/regions on international competitiveness of EU industry.  
281 European Steel Association, European Steel in Figures 2018, covering 2008 -17. Viewed at: 
http://www.eurofer.org/News%26Events/PublicationsLinksList/201806 -SteelFigures.pdf . 
282 In part, this reflects the capital -intensive nature of the industry, which spends EUR 3.9 billion per 
year on new mac hinery and building work. European Steel Association, European Steel in Figures 2018, 
covering 2008 -17. 
283 The multiplier effect of the 327,710 direct jobs in the steel industry is 7.7 times.  European Steel 
Association, European Steel in Figures 2018, cover ing 2008 -17. 
284 European Steel Association, European Steel in Figures 2019, covering 2009 -18. Viewed at: 
http://www.eurofer.org/News%26Events/N ews/20190703%20European%20Steel%20in%20Figures%202019.f
html. WT/TPR/S/395 • European Union  
 
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  Table 4.20 Crude steel production, 2014 -18 
Country  2014  2015  2016  2017  2018  2018  
(% share )  
Austria  7,876  7,687  7,438  8,135  6,885  4.1 
Belgium  7,331  7,257  7,687  7,842  7,980  4.8 
Bulgaria  612  543  527  652  666 0.4 
Croatia  167  122  0  0  136 0.1 
Czech Rep.  5,360  5,262  5,305  4,686  4,938  3.0 
Finland  3,807  3,988  4,101  4,003  4,146  2.5 
France  16,143  14,984  14,413  15,506  15,385  9.2 
Germany  42,943  42,676  42,080  43,910  42,435  25.3 
Greece  1,022  910  1,158  1,359  1,467  0.9 
Hungary  1,131  1,674  1,279  1,901  1,989  1.2 
Italy  23,714  22,018  23,373  24,068  24,532  14.6 
Luxembourg  2,193  2,127  2,175  2,172  2,228  1.3 
Netherlands  6,964  6,995  6,917  6,781  6,813  4.1 
Poland  8,541  9,198  8,940  10,289  10,167  6.1 
Romania  3,158  3,352  3,276  3,361  3,550  2.1 
Slovak  Rep.  4,705  4,562  4,808  4,980  4,947  3.0 
Slovenia  641  625  644  673  692 0.4 
Spain  14,187  14,846  13,631  14,434  14,299  8.5 
Sweden  4,514  4,348  4,595  4,692  4,632  2.8 
United 
Kingdom   12,061  10,853  7,635  7,492  7,268  4.3 
Others  2,053  2,015  1,998  2,056  2,215  1.3 
EU 28  169,126  166,042  161,982  168,992  167,370  100.0  
Source:  The European Steel Association, European Steel information in figures, 201 9 "Covering 200 9-18". 
Viewed at: https://aceroplatea.es/docs/EUROFERSteelFigures2019.pdf . 
4.202.   According to the Commission, the EU's competitive position on the global steel market 
deteriorated in recent years , mainly due to excess production of steel in third countries that has 
depressed prices and given rise to an unprecedented wave of unfair trading practices dis torting the 
global playing field. As a result, in 2016, the Commission presented its communication " Steel: 
Preserving sustainable jobs and growth in Europe" , with the following actions285: 
• defence against unfair trade practices  (Section 3.1.6.1) ;  
• tackling t he causes of global overcapacity: in addition to measures aiming to address 
global overcapacity, the EU is tackling the underlying causes of the problem at bilateral 
and multilateral level s. This is being done with the EU's main partners (China, Japan, Ind ia, 
the Russia n Federation , Turkey and the United States) as well as in relevant international 
forums;  
• investing in future solutions and technologies for a more competitive industry: 
encouraging more private and public investment in innovation, research an d new 
technologies. Various funds are available , such as the EUR 315 billion E FSI (which has 
already supported the moderni zation of a steel factory), the ESIF,  and Horizon 2020 ; 
• moderni zing the steel industry by investing in people: invest ing in people and their skills 
in close cooperation with member States  and social partners. The European Globalisation 
Adjustment Fund and the ESF are available to support workers and their local 
communities, to mitigat e adverse social consequences in the con text of relocation ; and  
• focussing policies in areas like competition, energy, emissions trading and the circular 
economy: state aid rules provide ample opportunities for member States  to support 
cross-border technology, research and innovation , and renewab le energy schemes.  
4.203.   MFN tariffs on i ron and steel (HS 72) and articles of iron and steel (HS 73) are relatively low, 
averaging 0.2 % and 1.7%, respectively, with rates ranging up to 7% and 3.7%, respectively . 
                                                
285 European Commission, Steel: Preserving sustainable jobs and growth in Europe. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52016DC0155&from=EN . WT/TPR/S/395 • European Union  
 
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  4.204.   The EU applies tariff rate quotas, some of which  provide autonomous access below MFN 
rates for steel products (Section 3.1.3.3).  Anti-dumping duties and safeguard measures are applied 
on some steel products , including recently -introduced surveillance of imports of certain aluminium 
products (Sections 3. 1.6.1 and 3.1.6.2).  
4.4  Services  
4.4.1   Financial Services  
4.4.1.1   Recent performance  
4.205.   The EU financial services sector accounted for some 4.9% of GDP in 2017 , and employed 
around 1.5% of the active population . The EU remained  a net exporter of  financial services  during 
the review period . The sector  plays a central role in the Union's economic performance, including 
business financing. In the Commission's view, financial services should contribute to an environment 
that protects consumers, promo tes market integrity , and supports investment, growth and jobs.286 
An ambitious reform package is underway within the EU to operationalize this vision , through the 
establishment of common financial rules for EU countries (Section 4.4.1. 2). 
4.206.   During the review period, the banking sector benefited from the positive macroeconomic 
developments in most European countries ( Section 1). Banks ' solvency ratios performed well, as 
Common Equity Tier 1 (CET1) ratios increased by 14.3% in 2017 and 14.5% in 2018. Asset quali ty 
improved further, in a context where the average non-performing loan (NPL) ratio of EU banks 
decreased  significantly (Section 4.4.1.2.1) . However, profitability remain ed low on average , and has 
not yet reached sustainable levels.287 
4.207.   The insurance market c ontinued to be challenged by the prolonged low interest rate 
environment.288 Increased political uncertainty in 2018 and growing trade tensions further 
exacerbated the existing challenges. Total Gross Written Premium s (GWP s) grew in 2018 but 
remained stable as a percentage of GDP. The sum of GWP for both the life and non -life insurance 
sector s grew by 4.2% on an annual basis , and amount ed to around EUR 1.3 trillion at the end of 
2018. Overall GWP as a percentage of GDP remained stable , around 9% , for the total 
European  insurance market, while total assets as a share of GDP slightly decreased from 74% to 
70%.  
4.208.   Based on estimates from  the European Insurance and Occupational Pensions Authority , the 
profitability of insurers remain s under pressure in the current low -yield environment , and 
deteriorated further in 2018. Despite lower profitability, the solvency position of life insurers slightly 
improved in 2018 due to a slight increase in the interest rates used for discounting liabilities. 
However , the non-life insurers ' solvency capital requirement (SCR) ratio slightly decreased from 
220% in 2017 to 204% in 2018. Although the solvency position o f EU insurers significantly differs 
across EU  countries, it remains above 100% for all countries . 
4.209.   Regarding the securities  market, in 2017, market capitalization grew by 11.3% compared 
with 2016, reaching an all -time high of EUR  1.8 trillion (76.9% of GDP for the EU -28), largely driven 
by, inter alia, global recovery in GDP growth, accommodative monetary policies in major markets, 
and low levels of inflation and volatility.289  
                                                
286 European Commission, Financial services policy.  Viewed at: https://ec.europa.eu/info/business -
economy -euro/banking -and-finance/financial -reforms -and-their-progress/financial -service s-policy_en . 
287 European Banking Authority (EBA), EBA sees further improvements in EU banks resilience but 
highlights challenges connected to profitability, funding and operational risk.  Viewed at: 
https://eba.europa.eu/ -/eba-sees-further -improvements -in-eu-banks -resilience -but-highlights -challenges -
connected -to-profit ability -funding -and-operational -risk?doAsGroupId=10180 . 
288 European Insurance and Occupational Pensions Authority, The European Insurance Sector.  Viewed 
at: https://ei opa.europa.eu/Publications/Reports/Chapter2_%20FSR_June2019.pdf . 
289 European Capital Markets Institute, Recent Developments in European Capital Markets: Key Findings 
from the 2018 ECMI Statistical Package, p.1. Viewed at:  https://www.ceps.eu/ceps -publications/recent -
developments -european -capital -markets -key-findings -2018-ecmi-statistical -package . WT/TPR/S/395 • European Union  
 
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  4.4.1.2   Regulatory developments  
4.210.   This subsection reviews developments regarding four key aspects of EU regulation in the 
financial services sector: regulatory reform aimed at reducing risk and enhancing the resilience of 
the banking sector; the Banking Union; the Capital Markets Union Action Plan; and determining the 
equivalence of third -country regulatory regimes.  
4.4.1.2.1   Measures aimed at reducing risk and enhancing the resilience of the banking 
sector  
4.211.   As part of its efforts to reduce risk in the banking sector, the EU adopted amendments to 
core elements of the Single Rulebook, and took steps to  tackle issues relating to non-performing 
loans ( NPLs).  
4.212.   Following the financial crisis, the EU developed rules designed to create a safer financial 
sector for the Single Market that apply to all financial actors in the EU -28. These rules, collectively 
known as the Single Rulebook290, include , in particular , stronger prudential requirements for banks, 
improved protection for depositors , and rules for managing failed banks.291 The key legal acts that 
constitute the Single Rulebook are the Capital Requirements Re gulation292 and Capital Requirements 
Directive IV293; the amended Directive on Deposit Guarantee Schemes294; and the Bank Recovery 
and Resolution Directive.295  
4.213.   In May 2019, the EU adopted a "banking reform package", based on a Commission proposal 
of November 2016 , which consists of amendments to the Capital Requirements Regulation and 
Directive and the Bank Recovery Resolution Directive to implement some outstanding issues that 
are essential to make the financial system more resilient and stable, and which had be en finalized 
by the Basel Committee on Banking Supervision and the Financial Stability Board.296 The package 
also included proposed amendments to the regulation establishing the Single Resolution Mechanism  
(SRM)297, one of the pillars of the Banking Union.  
                                                
290 European Banking Authority, The Single Rulebook . Viewed at: https://eba.europa.eu/regulation -and-
policy/single -rulebook . 
291 EU regulatory reforms in the financial sector are, to a large extent, based on international standards 
agreed by regulatory bodies, such as the G20, the Financial Stability Board, the Basel Committee on Banking 
Supervision, the International Organization of Securities Commissions, the International Association of 
Insurance Supervisors, the Financial Action Task Force, and the OECD. European Commission, International 
Relations.  Viewed at: https://ec.euro pa.eu/info/business -economy -euro/banking -and-finance/international -
relations_en . 
292 Regulation (EU) No. 575/2013 of the European Parliament and of the Council of 26 June 2013 on 
prudential requirements for credit institutions and investment firms and amendi ng Regulation (EU) 
No. 648/2012. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32013R0575&from=EN . 
293 Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to 
the activity of credit institutions and the prudential supervision of credit institutions and investment firms, 
amending Directive 2002/87/EC and repealing Dir ectives 2006/48/EC and 2006/49/EC. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32013L0036&from=EN . 
294 Directive 2014/49 of the Euro pean Parliament and of the Council of 16 April 2014 on deposit 
guarantee schemes. Viewed at:  https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:3201 4L0049&from=EN . 
295 Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a 
framework for the recovery and resolution of credit institutions and investment firms and amending Council 
Directive 82/891/EEC, and Directiv es 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 
2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No. 1093/2010 and (EU) No. 648/2012, of 
the European Parliament and of the Council. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32014L0059&from=EN .  
296 European Commission, Adoption of the banking package: revised rules on capital requirements 
(CRRII/CRD V) and re solution (BRRD/SRM).  Viewed at: https://europa.eu/rapid/press -release_MEMO -19-
2129_en.htm . 
297 Regulation (EU) No. 806/2014 of the European Parliament and of the Council of 15 July 201 4 
establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain 
investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and 
amending Regulation (EU) No. 1093/2010. Viewed at : https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32014R0806&from=EN . WT/TPR/S/395 • European Union  
 
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  4.214.   The changes made by the amended Capital Requirements Regulation298 (CRR II) and the 
Capital Requirements Directive299 (CRD V) include, inter alia : (i) the introduction of a binding 
leverage ratio requirement for all institutions subject to CRR II, which is set at 3% of Tier 1 capital, 
and an additional leverage ratio applicable to global, systematically -important institutions  (G-SIIs); 
(ii) a net stable funding ratio requirement to ensure that exposures are matched with stable funding 
sources; (iii) a new market  risk framework for reporting purposes; (iv) a requirement for third -
country institutions having significant activities in the EU to have an EU intermediate parent 
undertaking; (v) revised rules on capital requirements for counterparty credit risk and for exposures 
to central counterparties; (vi) an updated macro -prudential toolkit; (vii) measures aimed at reducing 
the administrative burden related to reporting and disclosure for small non -complex banks, as well 
as simplified market risk and liquidity rules  for those banks; (viii) a new total loss -absorbing capacity 
requirement for G-Slls; and (ix) an enhanced Minimum Requirement for own funds and Eligible 
Liabilities (MREL) subordination rules for G-SIIs.300 CRR II applies from 28 June 2021, subject to 
certai n exceptions. In principle, member States are required to adopt and publish the measures 
necessary to comply with CRD V by 28 December 2020.  
4.215.   The Bank Recovery and Resolution Directive301 (BRRD II ) amends the BRRD (Directive 
2014/59/EU)  regarding the loss -absorbing and recapitalization capacity of credit institutions and 
investment firms . BRRD II includes: a mendments to the requirement for contractual recognition of 
bail-in; new early -intervention powers for regulators ; a requirement for contractual recognitio n of 
resolution stay powers ; and amendments to the MREL calculation. Member States have until 
28 December 2020 to implement BRRD II . 
4.216.   The S ingle Resolution Mechanism Regulation302 (SRMR II ) amends the SRMR on the 
loss-absorbing and recapitalization capacity o f institutions and entities . It deals with , inter alia , the 
institution -specific add -on for G -Slls, and the general requirements applicable to banks established 
in the Banking Union. 
4.217.   The EU also took steps with respect to NPLs. It attaches great  importance to risk reduction 
on them, with a view to boosting banks ' profitability and ability to lend and , ultimately , boost 
economic growth. The level of NPLs has been on a decreasing trend in recent years, both at the 
EU level and in individual members .303 (Chart  4.3 and Chart 4. 4). In April 2019, the EU adopted a 
Regulation amending Regulation (EU) No . 575/2013 as regards minimum loss coverage for 
non-performing exposures.304 The Regulation provides for a statutory prudential backstop against 
any excessive  future build -up of NPLs without sufficient loss coverage on banks' balance sheets.  
                                                
298 Regulation (EU) 2019/876 of the European Parliament and of the Council of 20 May 2019 amending 
Regulation (EU) No. 575/2013 as regards the leverage ratio, the net stable fu nding ratio, requirements for own 
funds and eligible liabilities, counterpart credit risk, market risk, exposures to central parties, exposures to 
collective investment undertakings, large exposures, reporting and disclosure requirements, and regulation 
(EU) No. 648/2012. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019R0876&from=EN . 
299 Directive (EU) 2019/878 of the European Parliam ent and of the Council of 20 May 2019 amending 
Directive 2013/36/EU as regards exempted entities, financial holding companies, mixed financial holding 
companies, remuneration, supervisory measures and powers and capital conservation measures. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32019L0878&from=EN . 
300 European Commission, Adoption of the banking package: revised rules on capita l requirements 
(CRR II/CRD V) and resolution (BRRD/SRM).  Viewed at: https://europa.eu/rapid/press -release_MEMO -19-
2129_en.htm .  
301 Directive (EU) 2019/879 of the European Parliament a nd of the Council of 20 May 2019 amending 
Directive 2014/59/EU as regards the loss -absorbing and recapitalisation capacity of credit institutions and 
investment firms and Directive 98/26/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019L0879&from=EN . 
302 Regulation (EU) 2019/877 of the European Parliament and of the Council of 20 May 2019 amending 
Regulation (EU) No. 806/2014 as re gards the loss -absorbing and recapitalisation capacity of credit institutions 
and investment firms. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/P DF/?uri=CELEX:32019R0877&from=EN . 
303 European Commission, Fourth Progress Report on the reduction of non -performing loans and further 
risk reduction in the Banking Union.  Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52019DC0278&from=EN . 
304 Regulation (EU) 2019/630 of the European Parliament and of the Council of 17 April 2019 amending 
Regulation (EU) No. 575/2013 as regards minimum loss coverage for non -performing exposures. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32019R0630&from=EN . WT/TPR/S/395 • European Union  
 
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  Chart 4.3 Total gross NPLs and advances  
 
Source:  European Central Bank database. Viewed at: https://sdw.ecb.europa.eu . 
Chart 4.4 Total gross NPLs and advances  
 
Note:  Data on the Slovak  Republic  for two periods are not available.  
Source:  European Central Bank database. Viewed at: https://sdw.ecb.europa.eu . 
4.4.1.2.2   Banking Union  
4.218.   The Banking Union is an essential complement to the Economic and Monetary Union (EMU) 
and the internal market, which aligns respo nsibility for supervision, resolution and a single resolution 
fund at EU  level. It obliges  banks across the euro area to abide by the same rules.  While  the Single 
3.0%3.5%4.0%4.5%5.0%5.5%6.0%6.5%7.0%2014Q42015Q12015Q22015Q32015Q42016Q12016Q22016Q32016Q42017Q12017Q22017Q32017Q42018Q12018Q22018Q32018Q42019Q1Chart 4.[EU -NPLs] EU -28 total gross NPLs and advances
(% of total gross loans and advances, end of quarter values)
Source: European Central Bank Statistical Data Warehouse, Consolidated Banking data (CBD2). Viewed at: 
https://sdw.ecb.europa.eu/browse.do?node=9689727. 
-60.0%-40.0%-20.0%0.0%20.0%40.0%60.0%Slovak RepublicCzech RepublicEstoniaIrelandCyprusHungarySloveniaGermanyAustriaPortugalItalySwedenLuxembourgRomaniaBelgiumEU-28SpainBulgariaLithuaniaNetherlandsUnited KingdomFranceMaltaDenmarkGreeceCroatiaPolandFinlandLatviaChart 4.[EU -NPLs] EU total gross NPLs and advances by EU member States
(% change between 2017 and 2018)
Source: European Central Bank Statistical Data Warehouse, Consolidated Banking data (CBD2) . Viewed at: 
https://sdw.ecb.europa.eu/browse.do?node=9689727. WT/TPR/S/395 • European Union  
 
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  Rulebook applies to all EU countries, the Banking Union  applies to countries in the euro area . 
EU non-euro area  countries can also join.305 
4.219.   The Banking Union has three  pillars , of which two are operational . The first is the common 
supervision of banks through the Single Supervisory Mechanism (SSM) , which was brought into 
operation in  2014. It was placed within the European Central Bank ( ECB and is responsible for the 
direct supervision of the largest and most significant banking groups . As at 1 July 2019, 114 banks 
were under SSM supervision. National supervisors continue to oversee all other bank s, under the 
ultimate  responsibility of the ECB. The criteria for determining whether banks are considered 
significant relate to their size, economic importance, cross -border activities and the need for direct 
public suppo rts. 
4.220.   The second pillar is a proced ure for the orderly winding -up of banks, the Single Resolution 
Mechanism (SRM). It has been fully operational since January  2016, and has already addressed its 
first cases.  On 7 June 2017, the S ingle Resolution Board (SRB), the central resolution authority  
within the Banking Union,  adopted its first resolution decision in the case of Banco Popular. On 
23 June 2017, it decided not to take resolution action in relation to Banca Popolare di  Vicenza and 
Veneto Banca and , on 24  February  2018, it reached the same  decision concerning ABLV Bank AS 
and its subsidiary ABLV Bank Luxembourg S.A.  In addition, on 15 August 2019, f ollowing the ECB's 
assessment of AS PNB Banka as failing or likely to fail, the SRB decided that resolution action was 
not necessary .306 
4.221.   A Single  Resolution Fund (SRF) was established under the SRM . The SRF is expected  to 
ensure a uniform administrative practice in the financing of resolution s, and to avoid distortion to 
competition in the internal market due to divergent national practices. The SRF replace s the 
resolution financing arrangements of the participating EU member States in the Single Resolution 
Mechanism Regulation for banks incorporated in their territories . It is financed by bank s' 
contributions raised at the national level and pool ed at the EU level . As at July 2019, the total amount 
in the SRF was about  EUR 33 billion. The target size of the SRF is intended to be at least 1% of 
covered deposits by end -2023, which is expected to be about EUR 60 billion .307  
4.222.   A third pillar was proposed , in the form of a European Deposit Insurance Scheme  (EDIS) . 
However, it  has not yet been established.  The key objective of the EDIS is to protect covered 
deposits , i.e. up to EUR 100,000 against the consequences of insolvency of a credit institution. The 
relevant  legislative proposal envisages the establishment of a n EDIS in three successive stages: a 
reinsurance scheme for participating national Deposit Guarantee Schemes (DGSs)  for a first period 
of three years, a co -insurance scheme for participating nat ional DGSs for a second period of four 
years, and full insurance for participating national DGSs in the final stage .  
4.4.1.2.3   Capital Market s Union (CMU)  
4.223.   The CMU Action Plan, adopted in September 2015 , aims to develop deeper and more 
integrated capital markets across the EU.308 The CMU is a key pillar of the Investment Plan  for 
Europe, announced by the Commission in No vember  2014 (Section 1). The CMU is expected to 
ensure greater diversification in the funding of the economy , and reduce the costs of raising capital, 
particularly for SMEs. It is set to offer alternative sources of finance , in order to promote financial 
stability by increasing market liquidity and improving the allocation of risk among investors. The 
CMU is regarded as necessary to complement the Banking Union and to strengthen the EMU and the 
international role of the euro. It is also expected to contribu te to the development of the single 
                                                
305 European Commission, What is the banking union. Viewed at: https://ec.europa.eu/info/business -
economy -euro/banking -and-finance/banking -union/what -banking -
union_en#arulebookforallfinancialactorsintheeu . 
306 Single Resolution Boar d, AS PNB Banka: SRB Decides No Resolution Required.  Viewed at: 
https://srb.europa.eu/en/node/814 . 
307 Single Resolution Board, SRF grows to EUR  33 billion after latest round of transfers. Viewed at: 
https://srb.europa.eu/en/node/804 . 
308 European Commission, Action Plan on Building a Capital Markets Union . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52015DC0468&from=EN . In June 2017, the Commission 
published a monitoring report on progress in the implementation of the CMU, and introduced new measures, 
such as FinTech, to update and streng then the original Action Plan.  European Commission, Mid-term Review of 
the Capital Markets Action Plan . Viewed at: https://ec.europa.eu/info/sites/ info/files/communication -cmu-mid-
term-review -june2017_en.pdf . WT/TPR/S/395 • European Union  
 
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  market, to enhance the EU's attractiveness as a foreign investment destination, to help reorient 
private capital flows towards more sustainable investments, and to help reap the benefits of financial 
technology while saf eguarding consumer protection.309  
4.224.   The Commission presented 13 core CMU legislative proposals and three complementary 
proposals related to sustainable finance , and considers that it , thereby, has delivered all legislative 
proposals set out in the CMU Action Plan and in the 2017 mid -term review to put in place the key 
building blocks of the CMU.310  
4.225.   The Commission's l egislative proposals pertain to four categories of measures: (i) measures 
to make the most of the single market through new European products, labe ls and passports; 
(ii) measures to support business es and investors through clearer and simpler rules; (iii) measures 
to establish more efficient supervision of EU capital markets; and (iv) measures on sustainable 
finance.  
4.4.1.2.3.1   Measures to make the most of the Single Market through new European 
products, labels and passports  
4.226.   Four of the six core CMU legislative measures proposed by the Commission to introduce new 
EU-wide rules for products, labels and passports were adopted during the review period. Of the 
remai ning two proposals, one was the subject of political agreement between the Parliament and 
the Council, and the other is still under negotiation.  
4.227.   A regulation on European venture capital and social entrepreneurship funds  was adopted in 
October  2017 and applied from 1 March 2018.311 The Regulation  is intended to improve the 
regulations on European venture capital (EuVeCA) funds and European social entrepreneurship funds 
(EuSEF) that came into force in July 2013 .312 Firstly, it extend s the range of managers eligible to 
market and manage EuVECA and EuSEF funds . Secondly, it broaden s the definition of companies 
that can benefit from EuVECA investments (the qualifying portfolio undertakings) . Thirdly, 
it harmonizes the initial capit al and own funds requirements , with a view to simplifying registration 
processes throughout EU member States.  
4.228.   The Securitization Regulation  was adopted in December 2017 and was applied on 
1 January  2019.313 It sets transparency and other requirements for EU -regulated issuers 
(originators, sponsors, original lenders, and securitization special -purpose entities) as well as due -
diligence requirements for EU institutional investors for their securitization investments. The 
Regulation introduces a ban on "resecur itization" (no securitization of securitizations is allowed) , and 
brings the European regulation of securitization transactions under a unified legislative framework, 
marking the end of a sectoral and fragmented regulatory landscape. It establishes three k ey 
obligations: (i)  it requires due diligence and assessments that institutional investors need to run 
prior to, or when holding, a securitization position; (ii) it makes it an obligation for the originator, 
sponsor or original lender to retain at least 5%  of material net economic interest; and (iii) it requires 
originators, sponsors and securitization special -purpose entities to provide certain information to 
                                                
309 European Commission, Capital Markets Union: progress on building a Single Market for capital for a 
strong Economic and Monetary Union, pp. 1 -2. Viewed at: https://ec.europa.eu/finance/docs/policy/190315 -
cmu-staff-working -document_en.pdf . 
310 European Commission, Capital Markets Union: progress on building a Single Market for capital for a 
strong Economic and Monetary Union, p. 3. In addition to the legislative proposals, the Commission also took a 
number of non -legislative measures to implement the CMU Action Plan . 
311 Regulation (EU) 2017/1991 of the European Parliament and of the Council of 25 October 2017 
amending Regulation (EU) No. 345/2013 on European venture capital funds and Regulation (EU) No. 346/2013 
on European social entrepreneurship funds. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?uri=CELEX%3A32017R1991 . 
312 According to the EuVECA and EuSEF Regulations, the European Securities and Markets Authority 
(ESMA) is in charge of maintaining and keeping registers of the EuVECA and the EUSEF. As at 20 September 
2019, the registers counted 275 EuVECA funds and 11 EuSEF funds. ESMA, EuVECA and EuSEF registers. Viewed 
at: https://registers.esma.europa.eu/publication/searchRegister?core=esma_registers_euveca ; and 
https://registers.esma.europa.eu/publication/searchRegister?core=esma_registers_eusef . 
313 Regulation (EU) 2017/2402 of the European Parliament and of the Council of 12 December 2017 
laying down a general framework for securitisation and creating a specific fram ework for simple, transparent 
and standardised securitisation, and amending Directives 2009/65/EC, 2009/138/EC and 2011/61/EU and 
Regulations (EC) No. 1060/2009 and (EU) No. 648/2012. Viewed at:  https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017R2402&from=en . WT/TPR/S/395 • European Union  
 
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  investors, competent authorities and, where requested, to potential investors. Such information 
includes the underlying exposure, the essential documentation used in the transaction (excluding 
legal opinions), and the final offering document or prospectus used or a transaction summary. The 
Regulation enables certain securitization products to be design ated as Simple, Transparent and 
Standardized (STS) if they meet specific eligibility criteria relating to simplicity, transparency and 
standardization.  
4.229.   The Securitization Regulation was accompanied by amendments to the Capital Requirements 
Regulation appli cable to credit institutions and investment firms in respect of securitization, and to 
accommodate the proposed common rules and the new STS framework in the overall prudential 
framework.314 The framework provides a new hierarchy of risk calculation methods and lower capital 
requirements for positions in transactions qualifying as STS securitizations.  
4.230.   The Regulation on a pan -European Personal Pension Product was adopted on 
20 June 2019.315 It seeks to expand the market for personal pensions , through the creatio n of a 
pan-European pension product  (PEPP), the  features of which will be the same throughout the EU 
and can be offered by a wide range of providers, such as insurance companies, banks, occupational 
pension funds, investment firms , and asset managers. The Regulation ensures standardization of 
the core product features, such as: transparency requirements, investment rules, switching right , 
and type of investment options. PEPP providers will be able to sell the product anywhere in the EU 
with one single regis tration.  
4.231.   On 20 June 2019, the EU adopted a regulation  and a directive establishing a harmonized 
framework for the cross-border distribution of collective investment funds , with a view to  reduc ing 
regulatory barriers that hinder cross -border distribution of funds within the EU , and to enhance fund 
managers ' ability to fully benefit from the internal market.316 These measures aim to, inter alia , 
improve transparency by aligning national marketing requ irements and regulatory fees;  and 
introduce consistency in the way regulatory fees are determined . The new rules provide , notably , 
for a harmonized definition of pre -marketing, create a central database on cross -border marketing, 
modify the rules applicabl e to marketing communication requirements , and specify new 
requirements regarding facilities available to investors.  
4.232.   Political agreement was reached between the European Parliament and the Council on a 
Commission proposal for common rules on covered bonds.  Such harmonized rules are expected to 
develop covered bonds as a stable and cost -effective source of funding for EU banks.  
4.233.   A Commission proposal for a regulation on crowdfunding is still being negotiated. The 
proposal aims to allow platforms to apply for  an EU passport based on a single set of rules.  
4.4.1.2.3.2   Measures to support businesses and investors through clearer and simpler 
rules  
4.234.   The Commission proposed five core CMU legislative measures aimed at providing simpler, 
clearer and more proportionate rules for entrepreneurs, businesses and financial institutions. Two of 
                                                
314 Regulation (EU) 2017/2401 of the European Parliament and of the Council of 12 December 2017 
amending Regulation (EU) No. 575/2013 on prudential requirements for credit institutions and investment 
firms.  Viewed at: https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32017R2401&from=EN . 
315 Regulation (EU) 2019/1238 of the European Parliament and of the Council of 20 June 2019 on a pan -
European Personal P ension Product (PEPP).  Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019R1238&from=EN . The Regulation has entered into force but i s not yet 
applicable. It shall apply 12 months after the date of the adoption of certain delegated acts.  
316 Regulation (EU) 2019/1156 of the European Parliament and of the Council of 20 June 2019 on 
facilitating cross -border distribution of collective inve stment undertakings and amending Regulations (EU) 
No. 345/2013, (EU) No. 346/2013 and (EU) No. 1286/2014. Viewed at: https://eur -lex.europa.eu/legal -
content/EN /TXT/PDF/?uri=CELEX:32019R1156&from=EN . The Regulation applied from 1 August 2019, except 
that certain provisions will apply from 2 August 2021. Directive (EU) 2019/1160 of the European Parliament and 
of the Council of 20 June 2019 amending Directives 2009/65/EC and 2011/61/EU with regard to c ross-border 
distribution of collective investment undertakings. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019L1160&from=EN . Member States have until 2 August 2021 to comply 
with this Directive.  WT/TPR/S/395 • European Union  
 
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  the measures were adopted, and political agreement was reached on two of the other proposals. 
One proposed measure is still being negotiated.  
4.235.   On 20 July 2017, the Prospectus Regulation came into  force.317 It replaced the EU Prospectus 
Directive318, and lays down requirements for the drawing up, approval and distribution of the 
prospectus to be published when securities are offered to the public or admitted to trading on a 
regulated market situated or  operating within an EU member State. Except for some specific 
provisions that applied from 20 July 2017 or from 21 July 2018, the Regulation applied since 
21 July 2019, when the Directive was repealed. The new Regulation provides for, inter alia , a 
univer sal registration document; a simplified prospectus for secondary issuances; an EU growth 
prospectus to facilitate access to capital markets for small and medium -sized companies; new rules 
on risk factors; and new harmonized rules on the scrutiny and approv al of the prospectus, to drive 
supervisory convergence throughout the EU.  
4.236.   A directive  on preventive restructuring frameworks, second chance , and measures to 
increase the efficiency of restructuring, insolvency and discharge procedures  was adopted in 
June 2019.319 It focuses on three core elements: (i) common principles on early restructuring tools; 
(ii) rules to allow entrepreneurs to benefit from a second chance through discharge of debt; and 
(iii) targeted measures to increase the efficiency of insolvency, restructuring and discharge 
procedures.  
4.237.   Political agreement was reached on a Commission proposal r egulation on more proportionate 
and risk -sensitive rules for investment firms , in February 2019 . The proposal includes: (i) new and 
simpler prudential rules for  non-systemic investment firms , without compromising financial stability; 
and (ii) amended rules to ensure that large and system ic financial institutions which carry out 
bank-like activities and pose similar risks as banks are regulated and supervised like banks.  
4.238.   New rules that will facilitate financing through capital markets for small businesses  were 
agreed by co -legislators in March 2019. They aim to ensure  that smaller businesses in the EU have 
access to diversified sources of financing at each stage of their development. They are expected to  
make it cheaper and simpler for SMEs to access public markets through the "SME Growth Markets ", 
a new category of trading venue dedicated to small issuers.  
4.239.   A Commission proposal for a regulation on the law applicable to the third -party effects of 
assignments of claims  is under negotiation. It aims to reduce existing legal uncertainty throug h the 
adoption of a harmonized framework on conflict of laws rules, i.e. by determining which country's 
law applies to the third -party effects of assignments of claims in cross -border transactions.  
4.4.1.2.3.3    Measures to establish more efficient supervision of capit al markets  
4.240.   In March 2019, the European Parliament and EU member States reached political agreement 
on reforms of the European System of Financial Supervision (ESFS)320, based on two proposals made 
                                                
317 Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the 
prospectus to be published when securities are offered to the public or admitted to tradin g on a regulated market, 
and repealing Directive 2003/71/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017R1129&from=EN . 
318 Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 on the 
prospectus to be published when securities are offered to the public or admitted to trading and amending 
Directive 2001/34/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32003L0071&from=EN . 
319 Directive (EU) 2019/1023 of the European Parliament and of the Council of 20 June 2019 on preventiv e 
restructuring frameworks, on discharge of debt and disqualifications, and on measures to increase the efficiency 
of procedures concerning restructuring, insolvency and discharge of debt, and amending Directive (EU) 
2017/1132 (Directive on restructuring a nd insolvency). Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019L1023&from=EN . 
320 The ESFS was introduced in 2010. It consists of,  on the one hand, the three European Supervisory 
Agencies (ESAs), which are responsible for the supervision of the micro -level risk: the EBA, the EIOPA, and the 
ESMA; and, on the other, the European Systemic Risk Board (ESRB), which oversees the financial system as a 
whole and coordinates EU policies for financial stability. European Commission, European system of financial 
supervision . Viewed at: https://ec.europa.eu/info/business -economy -euro/banking -and-finance/financial -
supervision -and-risk-management/european -system -financial -supervision_en . WT/TPR/S/395 • European Union  
 
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  by the Commission in September 2017 and September 2018.321 Key aspects of these reforms 
include322: (i) an enhanced role for the EBA to ensure that all relevant authorities effectively and 
consistently incorporate risks of money laundering and terrorist financing into their supervisory 
strategies and practices ; (ii) ne w and improved instruments for the three European supervisory 
agencies (ESAs) to foster convergence in the way the European financial sector is supervised; 
(iii) more integrated supervision of capital markets at the EU level, through the extension of the 
European Securities and Markets Authority 's (ESMA) direct supervision to certain sectors that are 
highly integrated, have important cross -border activities, and which are, in most cases, regulated 
by directly applicable EU law. The ESMA will also play a more prominent coordinating role in market 
abuse cases; (iv) a strengthenin g of the roles of the ESAs with respect to consumer protection; 
(v) inclusion of provisions on sustainable finance, requiring the ESAs to integrate environmental, 
social and governance criteria into their work; (vi) a requirement that the ESAs take into ac count 
financial technological innovation in their activities; (vii) changes in the governance of the ESAs, 
designed to allow decisions to be taken quickly while integrating the knowledge and experience of 
national supervisors; (viii) an increase in the res ources of the ESAs, to provide them with the 
financial means for their new tasks; and (ix) changes to the governance of the European Systemic 
Risk Board (ESRB).323  
4.241.   Political agreement was also reached , in March 2019 , on amendments to the European 
Market Inf rastructure Regulation324 (EMIR) , to provide for more robust supervision of central 
counterparties, established in EU and non -EU countries, offering or planning to offer services to 
EU clearing members and their clients, as well as to EU trading venues.325 While the legal texts 
reflecting the changes agreed to in the EMIR , agreed in March 2019 (EMIR 2.2) , had not yet been 
published at the time of writing, another set of amendments to EMIR (EMIR Refit) was adopted in 
May 2019 and, with some exceptions, became ap plicable on 17 June 2019.326 
4.4.1.2.3.4   Measures on sustainable finance  
4.242.   Three CMU legislative proposals of the Commission pertain to measures that seek to promote 
environmentally sustainable activities, through, inter alia , resource -efficient and circular economy 
appro aches.  
4.243.   In March 2019, political agreement was reached between the European Parliament and 
EU member States on the Commission's proposal for a r egulation on disclosures relating to 
sustainable investment and sustainability risks . The aim of this proposal i s to introduce mandatory 
                                                
321 European Commission, Reinforcing integrated su pervision to strengthen Capital Markets Union and 
financial integration in a changing environment.  Viewed at: https://ec.europa.eu/finance/docs/law/170920 -
communication -esas_en.pdf ; and European Commission, Communication on Strengthening the Union 
framework for prudential and anti -money laundering supervision. Viewed at: 
https://ec.europa.eu/info/publications/180912 -esas-review -money -laundering_en . 
322 At the time of writing, these new rules had not yet been published.  
323 European Com mission, Capital Markets Union: Creating a stronger and more integrated European 
financial supervisory architecture, including on anti -money laundering . Viewed at: 
https://europa.eu/ rapid/press -release_MEMO -19-1928_en.htm . 
324 Regulation (EU) No. 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC 
derivatives, central counterparties and trade repositories. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32012R0648&from=EN . 
325 European Commission, Capital Markets Union: agreement on more robust supervision of central 
counterparties.  Viewed at: https://europa.eu/rapid/press -release_IP -19-1657_en.htm . The objectives of the 
EMIR are to increase transparency in the OTC derivatives market, and to make it safer by reducing 
counterp arty credit risk and operational risk. WTO document WT/TPR/S/317/Rev.1, 21 October 2015, 
para. 4.130.  
326 Regulation (EU) 2019/834 of the European Parliament and of the Council of 20 May 2019 amending 
Regulation (EU) No. 648/2012 as regards the clearing obli gation, the suspension of the clearing obligation, the 
reporting requirements, the risk -mitigation techniques for OTC derivative contracts not cleared by a central 
counterparty, the registration and supervision of trade repositories and the requirements fo r trade repositories. 
Viewed at:  https://eur -lex.europa.eu/eli/reg/2019/834/oj . This Regulation amends Regulation (EU) 
No. 648/2012, by widening the definition of Financial Counterparty to include all financial counterparties that are 
systematically important for the financial system. These include alternative investment firms and central 
securities depositaries. It exempts smaller financial counterparties and non -financial counterparties (those with 
small trading activities) from certain clearing and reporting obligations. The Commission would also have the 
power to suspend the clearing obligations f or specific types of derivatives in exceptional situations.  WT/TPR/S/395 • European Union  
 
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  disclosure, in order to allow investors to benefit from lower search costs in finding financial products 
and services corresponding to their sustainability preferences.  
4.244.   Political agreement was also reached, in February 2019, on a proposal for a r egulation on 
low-carbon and positive -carbon impact . It creates new market standards which will reflect 
companies ' carbon footprint , and give investors clearer information on how their investments 
contribute to fighting climate change .  
4.245.   Finally, negotiations are ongoing on a proposal by the Commission for a regulation on the 
unified EU classification system . This proposed regulation aims to provide investors with a common 
language to identify what economic activities can be considered env ironmentally sustainable. It will 
also be a basis for standards and labels for sustainable financial products.  
4.4.1.2.3.5   Other measures pertaining to the CMU  
4.246.   The Regulation  on money market funds (MMFs) was adopted in June 2017 and became 
applicable  on 21 July 2018.327 It lays down uniform rules for the operation of all MMFs that are 
established, managed, or marketed in the EU. It aims to make them more resilient to financial 
market difficulties, reduce the risk of runs, and limit cross -border contagion.  Under the Regul ation, 
MMFs that are managed or marketed in the EU must obtain specific authorization, and the use of 
the designation "money market fund" is reserved for funds authorized under the MMF Regulation.   
4.247.   The Regulation introduces , inter alia , enhanced liquidity requirements for all MMFs , and 
tighter rules on portfolio diversification. The new liquidity requirements were introduced to ensure 
there is sufficient liquidity to meet investors' redemption requirements.  
4.248.   The MMF Regulation establishes a set of requiremen ts on portfolio diversification , in order to 
limit risk -taking by the MMFs. MMFs may , therefore , not invest a certain share of their assets 
(specified in the Regulation) in money market instruments, securitizations, and asset -backed 
commercial papers issue d by the same body, and in deposits made with the same credit institution. 
In addition, there is a certain limit on the cash amount in reverse repurchase agreements, and the 
share of assets in units or shares of other MMFs. The Regulation also sets excepti ons to the portfolio 
diversification rules, notably for employee savings schemes.  
4.249.   Any "direct or indirect support offered to an MMF by a third party, including a sponsor of the 
MMF, that is intended for or in effect would result in guaranteeing the liquidi ty of the MMF or 
stabilizing net asset value per unit or share of the MMF" is prohibited under the Regulation. The 
Regulation provides a no n-exhaustive list of items that constitute external support.  
4.250.   The Regulation for cheaper cross -border payments in euro  and fairer currency conversions 
across the entire EU  was adopted in March 2019.328 It amends certain provisions of Regulation (EU) 
No. 924/2009, which provides for harmonized charges for cross -border payments and domestic 
payments in the euro currency only. The amended Regulation extends the scope to domestic 
payments in the currency of EU member States that are not par t of the euro area. Furthermore, it 
creates more transparency for consumers regarding currency conversion services and resulting 
charges. Its provisions regarding EU -wide harmonization of charges will apply from end -2019; and 
those  regarding conversion ser vices from mid -2020.  
4.4.1.2.4   Third -country equivalence and international cooperation  
4.251.   The Commission continued to work on, inter alia , ways to strengthen partnerships with 
financial authorities in third countries, and reinvigorate the EU -wide financial market. Reg arding 
international financial cooperation, i n July 2019, the Commission issued a communication setting 
out its overall approach to equivalence in the area of financial services . Prior to this date , 
                                                
327 Regulation (EU) 2017/1131 of the European Parliament and of the Council  of 14 June 2017 on money 
market funds. Viewed at: https:// eur-lex.europa.eu/eli/reg/2017/1131/oj . This Regulation is relevant to both 
the CMU and the single market.  
328 Regulation (EU) 2019/518 of the European Parliament and of the Council of 19 March 2019 amending 
Regulation (EC) No. 924/2009 as regards certain charges on cross -border payments in the Union and currency 
conversion charges. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32019R0518&from=EN . WT/TPR/S/395 • European Union  
 
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  equivalences were granted under similar procedures. Howev er, the communication confirms the 
EU's overall approach , and makes some  improvements to the procedures. For instance, it makes  
assessments more transparent , through public feedback periods before adoption of decisions .  
4.252.   The equivalence policy serves as a reference in assessing to what extent third countries' 
regulatory regimes achieve the same outcomes as the EU's own rules, and how the Commission 
grants equivalence to them  on this basis . It also describes how the Commission and the ESAs monitor 
the situat ion in those non -EU countries after equivalence decisions have been taken.  
4.253.   Since January 2018, the Commission has adopted equivalence decisions in the areas of the 
EMIR on margin requirements (Japan), the Capital Requirements Regulation (Argentina), the 
Markets in Financial Instruments Regulation on  the Derivative Trading Obligation (Singapore), and 
the EU Benchmarks Regulation (Singapore and Australia). An extension of equivalence in the area 
of the Markets in Financial Instruments Regulation on the Share Trading Obligation (Switzerland) 
was renewed in December 2018 and expired on 30 June 2019. Regarding  the Credit Rating Agencies 
Regulation , the Commission extended exis ting decisions for Hong Kong,  China;  Japan ; Mexico ; and 
the United States , and it repealed those  for Argentina, Australia, Brazil, Canada, and Singapore, as  
those  jurisdictions no longer met the standards set by the EU Credit Rating Agencies Regulation aft er 
its amendment in 2013.  
4.254.   The Commission set up a web page on the equivalence decisions currently in force .329 As at 
30 July 2019, the Commission ha d taken over 280 equivalence decisions for more than 30  countries, 
across various parts of the financial indus try.330 
4.4.2   Construction services  
4.4.2.1   Overview  
4.255.   The EU has an important construction sector which accounted for a total construction output 
of EUR  1.7 trillion in 2018, or about 10.7% of GDP.331 In terms of construction services, a narrower 
definition of this, it accou nted for about 5.5% of GDP in 2018. There were about 
3.5 million  enterprises, the vast majority of which (98%) were small enterprises, with less than 
20 workers.332 European enterprises had important activities abroad, with the main markets in 
North  America (30%) and Asia/Oceania (25%).333 According to the world ranking of international 
construction contractors334, EU firms rank high in terms of revenues generated abroad. Of the top 
ten ranked international firms in 2019, seven were EU firms.335 Further, about half  of total 
international revenues generated were by European firms although they have generally lost market 
share in recent years to Asian and emerging economy firms.336 Thus, the EU is the world's second -
largest trader of construction services, in terms of e xtra-EU trade.337  
4.256.   According to industry statistics, there was small growth of about 2% in the international 
turnover of European contractors338, reaching more than EUR  176 billion in 2017.339 Of this, about 
                                                
329 European Commission, Recognition of non -EU regulatory frameworks.  Viewed at: 
https://ec.europa.eu/info/business -economy -euro/banking -and-finance/intern ational -relations/recognition -
non-eu-financial -frameworks -equivalence -decisions_en#equivalence -decisions . 
330 European Commission, Equivalence in the area of financial services . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/?uri=CELEX:52019DC0349 . 
331 European Construction Industry Federation (FIEC), Annual Report 2019 . Viewed at: 
http://w ww.fiec.eu/en/library -619/annual -report -english.aspx . 
332 FIEC. Viewed at: http://www.fiec.eu/en/cust/documentrequest.aspx?DocID=43531 ; and Eurostat, 
Annual detailed enterprise statistics for construction (NACE Rev. 2, F) . Viewed at: 
https://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=sbs_na_con_r2&lang=en . 
333 FIEC, Annual Report 2019 . Viewed at: http://www.fiec.eu/en/library -619/annual -report -english.aspx . 
334 Those whose had the most revenues from abroad.  
335 Engineering News -Record ( ENR), ENR's 2019 Top 250 International Contractors . Viewed at: 
https://www.enr.com/toplists/20 19-Top-250-International -Contractors -1.  
336 European International Contractors, ENR Top 250 Intl contractors . Viewed at: https://www.eic -
federation.eu/industry/enr -top-250-intl-contractors .  
337 The EU is the world's largest trader, if both intra - and extra -EU trade are taken into account.  
338 Not all EU member States are included; figures i nclude Turkey.  
339 European International Contractors, Volume of Turnover 2017 . Viewed at: https://www.eic -
federation.eu/sites/default/files/fields/files/eic_2017_statistics_turnover.pdf . WT/TPR/S/395 • European Union  
 
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  43% was generated from within Europe340 and the remaining 57% from the rest of the world. In 
terms of world markets, North America is the most significant, with about EUR 30 billion of turnover 
for European contractors in 2017. Among EU suppliers, France, Germany, and Austria are the most 
significant in terms of international turnover.341 
Chart 4.5 Exports of construction services, construction abroad, 2017  
(EUR million)  
 
Note:  No data are available for Spain or the  United Kingdom.  
 Figures are based on the category "SE1 - Services - Construction abroad". It refers to total value of 
construction abroad by EU contractors; construction or installation projects performed by EU 
contractors in host economies (e.g. construction work carried out by EU c ontractors in 
extra-EU-28 member States).  
Source:  Eurostat, Balance of Payments  (bop_its6_det). Viewed at: 
https://ec.europa.eu/eurostat/web/balance -of-payments/data/databa se. 
4.257.   Services trade statistics for construction services also show a similar trend. Certain member 
States have strong intra -EU trade in construction services, while others have more significant 
markets outside the EU (Chart 4.5). France, in particular, foll owed by Finland and Denmark, have 
the most significant exports of construction services outside the EU; while France, Denmark, and 
the Netherlands are the EU's top exporters of construction services overall. The EU maintained a 
positive trade balance in co nstruction services of about EUR 9 billion over the period, although this 
slightly narrowed to about EUR  7.5 billion in 2018, mainly due to the slight decline in exports 
(Table  4.21). The main extra -EU markets for construction services remained unchanged d uring the 
period, with the United States, the Russian Federation, and Norway being the top three. In terms of 
imports, the United States, China, Norway, and the Republic of Korea are the most significant 
suppliers. Construction services are mainly provided  through commercial presence, and cross -border 
provision is not technically feasible for a wide range of the covered services.  
Table 4.21 Trade in construction services, 2015 -18 
(EUR million, unless otherwise indicated)  
  Exports (A+C)  Imports (B+D)  
  2015  2016  2017  2018  2015  2016  2017  2018  
World  29,608  31,815  29,210  28,927a 20,527  20,526  20,978  21,456a 
Intra-EU-28 15,674  19,331  16,049  17,300  14,777  15,031  15,257  15,708  
 % of world  52.9%  60.8%  54.9%  59.8%  72.0%  73.2%  72.7%  73.2%  
Extra-EU-28 13,932  12,485  13,160  11,627  5,751  5,495  5,722  5,748  
 % of world  47.1%  39.2%  45.1%  40.2%  28.0%  26.8%  27.3%  26.8%  
                                                
340 Includes EU, non -EU, and the Rus sian Federation.  
341 European International Contractors, Volume of Turnover 2017 . Viewed at: https://www.eic -
federation.eu/sites/default/files/fie lds/files/eic_2017_statistics_turnover.pdf . 
05001,0001,5002,0002,5003,0003,5004,0004,5005,000FranceDenmarkNetherlandsBelgiumFinlandGermanyPolandAustriaItalyPortugalSloveniaSwedenRomaniaEstoniaCzech RepublicLuxembourgLithuaniaLatviaHungaryGreeceCroatiaSlovak RepublicIrelandBulgariaCyprusMaltaIntra-EU-28
Extra-EU-28Chart 4. [EU] Exports of construction services (construction abroad) , 2017
(EUR million)
Source: Eurostat, Balance of Payments (bop_its6_det). Viewed at:
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database.Note: No data are available for Spain or the United Kingdom. 
Figures are based on the category "SE1 -Services -Construction abroad". It refers to total value of construction abroad 
by EU contractors; construction or installation projects performed by EU contractors in host economies ( e.g. construction 
work carried out by EU contractors in extra -EU-28 member States ).  WT/TPR/S/395 • European Union  
 
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    Exports (A+C)  Imports (B+D)  
  2015  2016  2017  2018  2015  2016  2017  2018  
Main extra -EU-28 partners      
    
  
United States  1,145  1,150  1,195  1,310  772 612 860 974 
Russian Federation  584 639 2,441  1,015  264 105 161 160 
Norway  1,112  974 919 .. 499 453 283 .. 
China  470 508 451 322 262 333 779 295 
Switzerland  532 470 437 536 359 346 331 433 
Korea, Rep. of  312 279 306 .. 70 644 818 .. 
 Construction abroadb  
A. Total value of construction abroad 
by EU -28 contractors  B. Expenditure on goods and services 
by EU -28 contractors in host country  
 
2015  2016  2017  2018  2015  2016  2017  2018  
World  27,758  29,348  26,889  .. 11,821  12,860  12,939  .. 
Intra-EU-28 14,291  17,431  14,384  .. 6,829  8,066  7,895  .. 
 % of world  51.5%  59.4%  53.5%  .. 57.8%  62.7%  61.0%  .. 
Extra-EU-28 13,465  11,919  12,506  .. 4,992  4,794  5,041  .. 
 % of world  48.5%  40.6%  46.5%  .. 42.2%  37.3%  39.0%  .. 
Main extra -EU-28 partners     
     
 
United States  1,100  1,093  1,099  .. 651 503 661 .. 
Russian Federation  535 616 2,426  .. 260 101 148 .. 
Norway  1,018  896 812 .. 339 319 223 .. 
China  459 503 405 .. 234 313 763  
Switzerland  431 398 402 .. 168 158 200  
Korea, Rep. of  311 263 225 .. 59 633 803  
  Construction in the EU -28c  
C. Expenditure on goods and services 
by non -resident (foreign) contractors  D. Total value of construction by non -
resident contractors in the EU -28 
  2015  2016  2017  2018  2015  2016  2017  2018  
World  1,849  2,469  2,321  .. 8,710  7,668  8,039  .. 
Intra-EU-28 1,382  1,901  1,667  .. 7,946  6,964  7,361  .. 
 % of world  74.8%  77.0%  71.8%  .. 91.2%  90.8%  91.6%  .. 
Extra-EU-28 467 567 657 .. 761 702 679 .. 
 % of world  25.2%  23.0%  28.3%  .. 8.7%  9.2%  8.4%  .. 
Main extra -EU-28 partners     
     
 
United States  44 59 95 .. 121 111 203 .. 
Russian Federation  48 22 15 .. 4 3 12 .. 
Norway  93 78 109 .. 160 133 59 .. 
China  10 6 46 .. 28 20 15 .. 
Switzerland  99 72 35 .. 193 187 129 .. 
Korea, Rep. of  0 16 81 .. 10 11 15 .. 
.. Not available.  
a Estimated intra -extra EU -28 data.  
b EU SE1 – Services – Construction abroad.  
c EU SE2 – Services – Construction in the reporting economy.  
Source:  Eurostat, Balance of Payments (bop_its6_det). Viewed at: 
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database . 
4.4.2.2   Legal and policy framework  
4.258.   The EU's main legislation for construction services is the EU's 2006 Services Directive, which 
entered into for ce in late 2009. It provides a framework for creating one single market for certain 
services342, fosters competition and the free movement of persons, and stipulates certain 
non-discriminatory requirements. The specific elements stipulated in the Directive were to establish 
                                                
342 The services covered by the Directive include business services such as management consultancy, 
certification and testing; facilities management, including office maintenance; advertising; recruitment 
services;  and the services of commercial agents. They also include services provided to both businesses and 
consumers, such as legal or fiscal advice; real estate services, such as estate agencies; construction, including 
the services of architects; distributive tr ades; the organization of trade fairs; car rental; and travel agencies. 
They also include consumer services, such as tourism, including tour guides; leisure services, sports centres 
and amusement parks; and certain household support services.  WT/TPR/S/395 • European Union  
 
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  points of single contact and the right to information, and provide for freedom of establishment, and 
for free movement of services. However, it did not have th e aim to further liberalize services per se , 
nor privatize public service entities.  
4.259.   Since its implementation, there have been a number of developments or follow -ups to 
monitor or improve the situation of services trade in the single market. The EU's 2015 Single Market 
Strategy is one of the important elements undertaken to upgrade the single market , and provide 
more opportunities in many areas, including services. As part of this initiative, the Commission 
launched a proposal and initiated consultation pro cedures to reform notifications of new regulatory 
requirements for services providers; this would, in essence, require that new and changed national 
regulations were non-discriminatory, justified and proportionate . As a result of the 2016 consultation 
procedures for the initiative, the feedback indicated that the majority of stake -holders considered 
the current services notifications system unsatisfactory and , in particular , sought obligations to 
notify draft legislation, increase transparency, and make cle arer the consequences of 
non-notification.343  
4.260.   In 2016, the EU launched a study under the Services Directive for the construction sector 
that set out to determine whether member States make full use of the principles of administrative 
and regulatory simplifi cation  under the Directive, including the use of mutual recognition.344 This, in 
particular, set out to assess market access conditions and authorization provisions with respect to 
building permits. As a result of the numerous findings on permanent and tempo rary obstacles to 
services trade, the report made a number of recommendations, including on regulatory 
simplification, administrative simplification, mutual recognition, and on specific points on various 
articles. It also recommended that s impler document requirements  and full electronic procedures  be 
pursued. While some member States, notably the Czech Republic and Denmark, have proceeded to 
simplify building permits, no major reforms addressing barriers to trade in construction services 
have been undertak en thus far, with most (administrative) simplification reforms limited to 
horizontal e -government initiatives. A second follow -up study was conducted in 2018 , that further 
examined the impediments to cross -border market access in construction services , in particular for 
specific segments of the construction services market  commonly referred to as "installation 
services ".345 For the 14 member States covered by the study, it estimated that the annual 
administrative costs of construction services formalities imp osed on providers establishing or 
providing services across internal market borders ranged from EUR  35 million to EUR  1.2 billion.  
4.261.   In addition to the Services Directive, there are several other EU directives or legal provisions 
that are important to the co nstruction services sector (Table 4.22). In order to improve the free 
movement of construction products , the EU put in place harmoni zed rules for the marketing of 
construction products , through the 2011 Construction Products Regulation (CPR), which entered  into 
force in July  2013. In particular, it puts in place methods and criteria for assessing and expressing 
the performance of construction products , and the conditions for the use of CE marking . In 
November  2016, the EU launched a review of the CPR with a  view to i mproving the functioning of 
the internal market for construction products .346 The initial feedback from interested parties, in 2017, 
indicated a preference for no legislative changes while improving implementation of the CPR.347 The 
Evaluation of the CPR and the Report on the relevance of the activities developed by the European 
Organisation of Technical Assessment Bodies was expected to be published in October 2019. 
A decision on the possible revision of the CPR will be taken by the new Commission . 
                                                
343 European Commission, Proposal to Reform the Notification Procedure for an Improved Enforcement 
of the Services Directive . Viewed at: 
https://ec.e uropa.eu/docsroom/documents/17562/attachments/1/translations/en/renditions/native .  
344 Publications Office of the European Union, Simplification and mutual recognition in the construction 
sector under the Services Directive . Viewed at: https://publications.europa.eu/en/publication -detail/ -
/publication/3e6f95eb -c658-11e5-a4b5-01aa75ed71a1 .  
345 Publications Office of the European Union, Study on costs involved in accessing markets cross -border 
for provision of construction services . Viewed at: https://publications.europa.eu/en /publication -detail/ -
/publication/ac972617 -b7cf-11e8-99ee-01aa75ed71a1 .  
346 European Commission, Review of the CPR . Viewed at: 
https://ec.europa.eu/growth/sectors/ construction/product -regulation/review_en . 
347 European Commission, Review of the Construction Products Regulation – Summary of the Public 
Feedback to the Inception Impact Assessment . Viewed at: https://ec.europa.eu/docsroom/documents/31222 . WT/TPR/S/395 • European Union  
 
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  4.262.   In 2018 , the EU amended the 1996 Directive on the posting of workers in the framework of 
the provision of services .348 This has a particular impact on the construction services sector, as 
approximately half of the postings within the internal market are reportedly for construction 
services.349 Some of the important changes include a l imitation on the maximum time, i.e. 12 months 
plus a possible 6 -month extension, whereafter terms of employment would revert to those of the 
host member State; application to posted workers of all the mandatory elements of remuneration; 
and application of the rules of the host member State on workers ' accommodation and allowances 
or reimbursement of expenses.350 
Table 4.22 Principal legal instruments for construction services  
Instrument  Reference  
Services Direct ive Directive 2006/123/EC  
Professional Qualifications Directive  Directive 2005/36/EC, as amended  
Energy Performance of Buildings Directive  Directive 2010/31/EU, as amended  
Energy Efficiency Directive  Directive 2012/27/EU, as amended  
Renewable Energy Sources Directive  Directive 2009/28/EC, as amended  
Construction Products Regulation  Regulation (EU) No. 305/2011, as 
amended  
Posting of workers in the framework of the provision of services  Directive 96/71/E C, as amended  
Enforcement Directive of  the Posting of Workers Directive  Directive 2014/67/EU  
Article 12 of Regulation (EC) No . 883/2004 , on social security 
aspects of the posting of workers  Decision  No. A2 of 12 June 2009 
concerning the interpretation of Article 
12 of Regulation (EC) No . 883/2004 -  
(2010/C 106/02)  
Late Payments Directive  Directive 2011/7/EU  
Occupational Safety and Health Framework Directive  
Directive on the Manual Handling of Loads  Directive 89/391/EEC, as amended  
Directive 90/269/EEC,  as amended  
Directive on Temporary or Mobile Construction Sites  Directive 92/57/EEC,  as amended  
Asbestos Directive  Directive 2009/148/EC, as amended  
Work Equipment Directive  Directive 2009/104/ EC 
Source:  Compilation by the WTO Secretariat.  
4.263.   The EU construction sector is an important contributor  to the economy and a creator of jobs; 
it also plays an important role in sustainability, quality of life, and climate change.351 However, it 
faces a number of challenges and structural issues. Some of these include, the shortfall of skilled 
workers, the sha rp decline as a result of the financial crisis, the productivity and resource efficiency 
of the sector, and the capacity for innovation. Thus, the EU has put forth a number of policy initiatives 
or strategies in recent years to address some of these issues . As part of its Europe 2020 Strategy, 
the EU issued a Communication on Strategy for the sustainable competitiveness of the construction 
sector and its enterprises  in 2012.352 This Strategy focuses on s timulating favourable investment 
conditions ; improving t he human -capital basis of the construction sector ; improving resource 
efficiency, environmental performance and business opportunities; s trengthening the internal 
market for construction ; and f ostering the global competitive position of EU construction enterprises . 
As part of the last point on the global competitive position, the EU indicated it would seek to secure 
ambitious market access commitments from partner countries in trade negotiations, regarding 
access to both commercial and procu rement markets.  
4.264.   One recent development was a proposed Directive and Regulation on a Services E -card.353 
This initiative proposes a harmonized notification form in order to obtain a type of " services 
                                                
348 Directive (EU) 2018/957 of the European Parliament and of the Council of 28 June 2018 amending 
Directive 96/71/EC concerning the posting of workers  in the framework of the provision of services . Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=uriserv%3AOJ.L_.2018.173.01.0016.01.E NG.  
349 FIEC. Annual Report 2019 . Viewed at: http://www.fiec.eu/en/library -619/annual -report -english.aspx .  
350 European Commission, Employment, Social Affairs & Inclusion – Posted w orkers . Viewed at: 
https://ec.europa.eu/social/main.jsp?catId=471 . 
351 European Commission, Strategy for the sustainable competitiveness of the construction sector and 
its enterprises . Viewed at:  https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52012DC0433&from=EN .  
352 European Commission, Strategy for the sustainable competitiveness of th e construction sector and 
its enterprises . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52012DC0433&from=EN .  
353 European Parliamen t, Legislative Train Schedule – Deeper and Fairer Internal Market with a 
Strengthened Industrial Base/Services including Transport . Viewed at: WT/TPR/S/395 • European Union  
 
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  passport ", securing access to the activity in a host membe r State, enhanc ing cooperation between 
home and host member States , and aiding  service  providers operating across borders . This 
fully-electronic harmonized procedure will reduce administrative obstacles, simplifying formalities so 
that service providers ma y provide the necessary services abroad more efficiently. Since 
March  2018, the initiative's legislative process has been put on hold.   
4.265.   The EU construction industry has been working towards further digiti zation and promoting 
the digital transformation of t he construction sector through its Construction 4.0 initiative , in order 
to utilize more efficient processes and eliminate errors and delays .354 As such , it aims  to make the 
construction sector a priority sector in the Digitising European Industry initiative .355 In this context, 
the European Commission  launched s everal initiatives , including the  EU Building Information 
Modelling ( BIM) Task Group356 and the upcoming EU Digital Construction Platform .357 The 
EU Directive on Public Procurement also foresees rules for t he use of BIM in the tendering of public 
construction project s. Construction 4.0 notes that digitali zation of the construction industry has 
many aspects , including industrial production, robotics, and digitally -controlled construction sites. 
According to o ne source, the construction sector is the least -digitized sector in Europe.358 
4.4.2.3   Support  
4.266.   There are a number of programmes that the EU maintains that support, either directly or 
indirectly, the construction service sector. The Build Up Skills initiative of the European Portal for 
Energy Efficiency of Buildings and the Energy -Efficient Building European Initiative are two examples 
of where EU research, work, and funding has been allocated to the construction sector.359 The 
EU's development  policies promoting public private partnerships and government procurement rules 
for construction projects also have a positive impact on the sector.  
4.4.2.4   Trade commitments, restrictions, and openness  
4.267.   The EU  undertook commitments for construction services in it s GATS schedule and also 
includes construction service commitments in its FTAs. Under the GATS, the EU made partial 
commitments in all five construction service subsectors, i.e.  general construction work for buildings, 
general construction work for civil e ngineering, installation and assembly work, building completion 
and finishing work, and other, with some variations in the scope for some member States.360 
However, due to the enlargement of the EU, some member States retain certain restrictions that 
were co ntained in their GATS schedules. Recently, the EU produced a consolidated services schedule 
that outlines all the varying commitments by member States.361 In general, mode 1 remains 
unbound except for two subsectors for most member States, and mode 2 contain s no limitations, 
except it remains unbound for three member States. For modes 3 and 4, the EU is committed, apart 
from certain specific limitations, and five members States that are unbound for commercial presence . 
So, whereas the EU take s few GATS commit ments for cross -border services,  often also technically 
unfeasible, it is substantially committed for commercial presence and the related presence of natural 
persons.  
4.268.   Commitments made with respect to the EU's various FTAs indicate the sector is relatively 
open, and improved offers have been made to FTA partners. In its FTAs, all recent agreements from 
                                                
http://www.europarl.europa.eu/legislative -train/theme -deeper -and-fairer -internal -market -with-a-
strengthened -industrial -base-services -including -transport/file -services -e-card.  
354 FIEC, Annual Report 2019 . Viewed at: http://www.fiec.eu/en/library -619/annual -report -english.aspx . 
355 European Commission, The Digitising European Industry initiative in a nutshell . Viewed at: 
https://ec.europa.eu/digital -single -market/en/news/digitising -european -industry -initiative -nutshell .  
356 EUBIM. Viewed a t: http://www.eubim.eu/ .  
357 The European digital platform for construction will address the main challenges related to the uptake 
of digital tools in support of the digital evolution of the sector. Horizon 2020 - Digita l Platform for Construction 
in Europe . Viewed at: https://cordis.europa.eu/project/rcn/224179/factsheet/fr . 
358 EURACTIV, Construction: The least digitised sector in Europe . Viewed at: 
https://www.euractiv.com/section/digital/news/construction -the-least-digitised -sector -in-europe/ .  
359 European Commission, Build Up – The Europe an Portal for Energy Efficiency in Buildings . Viewed at: 
https://www.buildup.eu/en ; and Energy Efficient Buildings, an ECTP Committee for Innovative Built 
Environment . Viewed at: http://e2b.ectp.org/index.php .  
360 WTO document S/C/W/302, 18 September 2009.  
361 Eur-Lex, European Union schedule of specific commitments annexed to the General Agreement on 
Trade in Services (GATS) . Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/?qid=1567072778229&uri=CELEX:52019XC0816(05) . Also, WTO document, GATS/SC/157.  WT/TPR/S/395 • European Union  
 
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  the last decade cover almost full commitments for commercial presence, and thereby expand the 
EU's GATS commitments by removing market access limitations and extending the scope to the full 
range of construction services. For the two recent FTAs with Canada and Japan, applying a negative 
listing approach, the EU has included no reservations against the market access or national 
treatment provisions for the five  construction service subsectors, apart from an existing nationality 
requirement in one member State, and a construction sector -related residency requirement in 
another.  
4.269.   According to information from the OECD on services' trade restrictiveness, EU member 
States were ranked relatively open compared to OECD peers for construction services, as 18 of the 
23 member States analysed rank below the restrictiveness average for the sector.362 Latvia, the 
United Kingdom, and Germany were ranked as the least restrictive among the 23 member States, 
whereas Belgium, Greece, and Italy were the most restrictive.363 Further, there are relatively few 
restrictions for trade among EEA countries within the single market364, whereas more barriers or 
restrictions are applied to the MFN regime.365 Most EEA trade restrictions are in the regulatory 
transparency matters category, i.e. public comment time and procedures; and cost, time and 
procedures for a construction permit.366 The OECD data indicate there are essentially no, or very 
minimal, r estrictions within the EEA for entry from other EEA countries, movement of persons, and 
other discriminatory measures for construction services.  
4.270.   With respect to the MFN regime, the OECD data indicate a range of restrictions that differ 
among the member Sta tes (Table A4.1).  While there are no foreign equity restrictions among any 
of the 23 EU member States represented in the OECD data, and thus firms can be 100% 
foreign -owned, other restrictions are often applied on foreign entry, such as land acquisition 
restrictions, local presence requirements, and cross -border data flow restrictions.367 A major 
difference, compared to the EEA regime, is the restriction on the movement of people, whereby each 
of the 23 member States have some type of labour market restrictio n, and there are limits on the 
duration of stay. Some member States also have discriminatory measures in terms of public 
procurement, and some entities may be state -owned. As for regulatory transparency, more onerous 
restrictions are generally applied comp ared to the EEA regime, i.e. in respect of public comment 
time and procedures; business visas; and cost, time and procedures for a construction permit.  
4.4.3   E-commerce  
4.4.3.1   E-commerce in the context  of the Digital Single Market (DSM) Strategy  
4.271.   Adapting the EU economy  to the opportunities and challenges created by the digital 
transformation has been a major policy priority for the EU in recent years. The digital economy is 
regarded as a prominent example of an area in which the potential of the EU's Single Market has 
not been fully exploited.368 This is particularly important in view of the close complementarities 
                                                
362 Data were available for 23 member States: Austria, Belgi um, the Czech Republic, Denmark, Estonia, 
Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, 
Poland, Portugal, the Slovak Republic, Slovenia, Spain, Sweden, and the United Kingdom. The OECD data are 
broadly categorized in five main areas: restrictions on foreign entry, restrictions to the movement of people, 
other discriminatory measures, barriers to competition, and regulatory transparency.  
363 OECD, STRI Sector Brief: Construction services . Viewed at : 
http://www.oecd.org/trade/topics/services -trade/documents/oecd -stri-sector -note-construction.pdf . 
364 Another source of information is availabl e through the EU's Performance Checks, State of Play of the 
Internal Market in the Construction Sector from 2012 that lists certain rules and internal regulations of the 
member States. European Commission, Results – Performance check – Construction service s. Viewed at: 
http://ec.europa.eu/DocsRoom/documents/14954/attachments/1/translations .  
365 OECD, Intra-EEA STRI Database: Methodology and Results . Viewed at: https://www.oecd -
ilibrary.org/trade/intra -eea-stri-database_2aac6d21 -en.  
366 OECD. Intra-EEA Services Trade Restrictiveness Index Simulator . Viewed at: 
http://www.oecd.org/trade/topics/services -trade/ . 
367 It is noted from GATS commitments that Cyprus has certain foreign ownership restrictions.  
368 European Commission, The Single market in a changing world. A unique asset in need of renewed 
political commitment. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52018DC0772&from=EN ; Copenhagen Economics, Making EU Trade in 
Services Work for All. Enhancing innovation and competitiveness throughout the EU economy, pp.51-54. 
Viewed at: 
https://www.copenhageneconomics.com/dyn/resources/Publication/publicationPDF/5/465/1543487161/final -
report -on-single -market -for-services -15nov2018_v2.pdf ; and  OECD, OECD Economic Surveys: Euro Area WT/TPR/S/395 • European Union  
 
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  between services provided by digital means and different sectors of the economy. According to a 
recent communication of the European Commission, "[d]igital tech nologies have become an integral 
part of the Single market to a point that the distinction between the traditional "brick and mortar" 
Single market and the 'digital' Single market is no longer relevant".369 Digital services are of critical 
importance to enab le the EU to improve its performance in the services sector.370  
4.272.   The DSM Strategy was launched in 2015 as part of the Europe 2020 Strategy . It aims to 
create a market "in which the free movement of goods, persons, services and capital is ensured and 
where in dividuals and businesses can seamlessly access and exercise online activities under 
conditions of fair competition, and a high level of consumer and personal data protection, irrespective 
of their nationality or place of residence".371 The Strategy rests on three main pillars: (i) better 
access for consumers and businesses to online goods and services across Europe; (ii) creating the 
right conditions for digital networks and services to flourish; and (iii)  maximizing the growth 
potential of the European digit al economy.372  
4.273.   A considerable number of legislative measures were adopted and/or took effect pursuant to 
the EU's DSM Strategy during the period under review. Of the 30 legislative initiatives presented by 
the Commission in the framework of the Strategy, 28  were politically agreed or finalized by the 
European Parliament and the Council of the EU, and two are still pending.373  
4.274.   To monitor the progress of EU member States towards a digital economy and society, the 
Commission developed the Digital Economy and Soc iety Index (DESI), which is composed of 
five principal dimensions: connectivity; human capital; use of Internet services; integration of digital 
technology; and digital public services.374 According to the 2019 edition of the DESI, all EU member 
States impro ved their performance. The member States with the highest scores were Finland, 
Sweden, the Netherlands and Denmark, followed by the United Kingdom, Luxembourg, Ireland, 
Estonia and Belgium. The countries that made the most progress over the last five years  were 
Ireland, Lithuania, Latvia, Cyprus and Spain. A comparison of the digital performance of EU member 
States with that of 17 non -EU countries375 shows that the top four EU member States (Finland, 
Sweden, the Netherlands and Denmark) were among the global leaders in digitalisation, just behind 
the Republic of Korea, with higher scores than Japan and the United States. At the same time, the 
average digital performance of EU member States was significantly lower than that of Japan and the 
United States.376  
                                                
2018,  p. 43. Viewed at: https://read.oecd -ilibrary.org/economics/oecd -economic -surveys -euro-area-
2018_eco_surveys -euz-2018-en#page1 . 
369 European Commission, The Single market in a changing world. A unique asset in need of renewed 
political commitment,  pp. 11 -12. 
370 Copenhagen Economics (2018), Making EU Trade in Services Work for All. Enhancing innovation and 
competitiveness throughout t he EU economy , p.52.  
371 European Commission, A Digital Single Market Strategy for Europe . Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CE LEX:52015DC0192&from=EN ; and European Commission, on 
the Mid -Term Review on the implementation of the Digital Single Market Strategy. A Connected Digital Single 
Market for All . Viewed at:  https://eur -lex.europa.eu/resource.html?uri=cellar:a4215207 -362b-11e7-a08e-
01aa75ed71a1.0001.02/DOC_1&format=PDF . 
372 The previous report reviewed developments relating to the regulatory regime for e -commerce, which 
concerns the first pillar of the DSM Strategy. WTO document WT/TPR/S/357/Rev.1, 13 October 2017, 
Section  4.3.2. It should be noted that this report does not purport to provide a complete analysis of 
developments relating to all three pillars of the Strategy, but mainly covers the first two. Under the third pillar, 
the review period saw the adoption of the Regulation on a framework for the free flow of non -personal data in 
the European Union, the Regulation on the protection of natural persons with regard to the processing of 
personal data by the Union institutions, bodies offices and agencies and on the free movement of such data; 
the Revision of the European I nteroperability Framework; the e -Government Action Plan; and the Directive on 
open data and the re -use of public sector information.  
373 European Commission, A Digital Single Market for the benefit of all Europeans.  Viewed at: 
https://ec.europa.eu/digital -single -market/en/news/digital -single -market -benefit -all-europeans . 
374 European Commission, The Digital Economy and Society Index (DESI) . Viewed at: 
https://ec.europa.eu/digital -single -market/en/desi . The precise indicators used to measure each of these 
dimensions are described in European Commission, DESI 2019 Digital Economy and Society Index.  
Methodological Note.  Viewed at: https://ec.europa.eu/digital -single -market/en/desi . 
375 Australia, Brazil, Canada, Chile, China, Iceland, Israel, Japan, the Republic of Korea, Mexico, 
New Zealand, Norway, Russia, Serbia, Switzerland, Turkey and the United States.  
376 European Commission, Digital Economy and Society Index (DESI) 2019: Questions and Answers . 
Viewed at: https://europa.eu/rapid/press -release_MEMO -19-2933_en.htm . WT/TPR/S/395 • European Union  
 
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  4.4.3.2   Improving access for consumers to online goods and services across Europe  
4.275.   The Directive on electronic commerce, adopted in June 2000377 and discussed in previous 
reports378, constitutes t he basic legal framework for the regulation of e -commerce in the EU .  
4.276.   The Eu ropean Commission's communication on the DSM Strategy identified five types of 
regulatory barriers to the growth of cross -border e -commerce within the EU: (i) the complexity and 
disparity of national contract and consumer protection laws; (ii) the cost and  inefficiencies of 
high-quality cross -border parcel delivery services; (iii) practices used by online sellers that result in 
the denial of access to websites based in other member States; (iv) obstacles to the cross -border 
access to copyright -protected con tent and services; and (v) the burdens on businesses arising from 
different VAT systems.379  
4.277.   When it made its proposals for new rules on digital contracts, the Commission illustrated the 
untapped potential of cross -border e -commerce within the EU by pointing  out that only 15% of 
EU consumers bought online from other EU countries, while 44% bought online in their own country. 
It also observed that only 12% of EU retailers sold online to consumers in other EU countries, while 
37% sold online in their own country.380 More recent data indicate that, in 2017, 33% of 
European  consumers bought online from other EU countries, and that 18% of European retailers 
sold online to other EU countries.381 
4.278.   During the period under review, the EU adopted legislative measures w ith respect to all five 
types of regulatory barriers identified in the DSM Strategy communication:  
• Regulation on cross -border portability of online content subscriptions in the internal 
market (June 2017) (Section 3.3.7);  
• Regulation on cooperation between  national consumer protection agencies 
(December  2017);  
• Directive and two regulations on VAT aspects of e -commerce (December 2017);  
• Regulation on unjustified geoblocking (March 2018);  
• Regulation  on cross -border parcel delive ry services (April 2018);  
• Directive on copyright in the Digital Single Market (April 2019) (Section 3.3.7);  
• Directive on copyright and related rights applicable to certain online transmissions of 
broadcasting organizations and retransmissions of television and radio programm es 
(April  2019) (Section 3.3.7); and  
• Directives on contracts for the supply of digital content and the provision of digital services 
and on contracts for the sale of goods (May 2019).  
4.4.3.2.1   Cooperation regarding the application of consumer protection rules  
4.279.   Closely related to the harmonization of certain aspects of contracts laws (Section 4.4.3.2.5), 
the implementation of the DSM Strategy involved steps to strengthen their enforcement. A regulation 
                                                
377 Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal 
aspects of information society services, in particular electronic commerce, in the In ternal Market (Directive on 
electronic commerce). Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32000L0031&from=EN . 
378 WTO document W T/TPR/S/317/Rev1, 21 October 2015, pp.157 -158. 
379 European Commission, A Digital Single Market Strategy for Europe , pp. 4 -9. 
380 European Commission, Commission proposes digital contract rules across the EU . Viewed at: 
https://www.darkpony.com/blog -en/commission -proposes -digital -contract -rules-across -the-eu/. 
381 European Commission, The Single market in a changing world. A unique asset in need of renewed 
political commitment.  Statistics on various indicators of the development of e -commerce in the EU are 
available at: https://ec.europa .eu/eurostat/statistics -explained/index.php/E -
commerce_statistics_for_individuals  (e-commerce statistics for individuals).  WT/TPR/S/395 • European Union  
 
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  adopted in December 2017 amends existing EU rules on cooperation between national consumer 
protection authorities to make them more effective in a digital context.382 This regulation entered 
into force in January 2018 and will be applicable from 17 January 2020.  
4.280.   It specifies the minimum powers of investigation and enforc ement that national consumer 
protection authorities must possess in order to address unlawful online practices. It also establishes 
a mechanism for mutual assistance and a procedure for coordinated investigation and enforcement 
for widespread infringements  with an EU dimension. Finally, it provides for a mechanism whereby 
competent national authorities shall notify the Commission and other competent authorities of any 
case in which an infringement covered by the regulation may affect consumers' interests in  other 
member States.383 
4.4.3.2.2   VAT aspects of e -commerce  
4.281.   Reform of VAT rules is an important dimension of the DSM Strategy. In December 2017, the 
EU adopted new VAT rules as part of a modernization of VAT for e -commerce. The new rules comprise 
three legal acts, a Council Directive384, a Council Regulation385 and a Council Implementing 
Regulation.386 Some of the rules became applicable on 1 January 2019, while others will become 
applicable on 1 January 2021.  
4.282.   One of the main rationales for the adoption of these new rules w as the fact that the 
complexity of compliance with VAT obligations had often been identified by businesses as one of the 
key reasons why they did not engage in cross -border e -commerce. According to the Commission, 
"companies that sell goods online pay arou nd EUR 8,000 in VAT compliance costs for every country 
into which they sell".387 Secondly, the existing VAT rules were regarded as creating a competitive 
disadvantage for EU business relative to non -EU companies. Thirdly, the complexity of the VAT rules 
entailed a significant loss of potential revenue for EU member States.388  
4.283.   The new VAT rules for e -commerce adopted in December 2017 were based, in part, on an 
assessment of the positive experience gained with the application of the special scheme introduced 
in 2015 regarding the application of VAT to certain services. Under this Mini One -Stop-Shop system 
(MOSS), suppliers of telecommunications, broadcasting and electronic services have been able to 
sell to consumers in other EU member States and account for VAT in respect of sales to all member 
States in only one member State, thus obviating the need for a separate VAT registration in each 
individual member State to which they sell. The VAT paid to the tax authorities of the member States 
is allocated among the m ember States through a mechanism managed by the Commission.389  
                                                
382 Regulation (EU) 2017/2394 of the European Parliament and of the Council of 12 December 2017 on 
cooperation between national authori ties responsible for the enforcement of consumer protection laws and 
repealing Regulation (EC) No. 2006/2004. Viewed at: https://eur -lex.europa.eu/legal -
conten t/EN/TXT/PDF/?uri=CELEX:32017R2394&from=EN . 
383 Regulation (EU) 2017/2394, Arts. 9, 11, 15 -21, 26 . 
384 Council Directive (EU) 2017/2455 of 5 December 2017 amending Directive 2006/112/EC and 
Directive 2009/132/EC as regards certain value added tax obligations f or supplies of services and distance 
sales of goods. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017L2455&from=EN . 
385 Council Reg ulation (EU) 2017/2454 of 5 December 2017 amending Regulation (EU) No. 904/2010 on 
administrative cooperation and combating fraud in the field of value added tax. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32017R2454&from=EN . 
386 Council Implementing Regulation (EU) 2017/2459 of 5 December 2017 amending Implementing 
Regulation (EU) No. 282/2011 laying down implementing measures for Di rective 2006/112/EC on the common 
system of value added tax. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017R2459&from=EN . 
387 European Commission, Modernising VAT for e -commerce: Question and Answer.  Viewed at: 
https://europa.eu/rapid/press -release_MEMO -16-3746_en.htm . 
388 European Commission, Proposal for a Council Directive amending Directive 2006/112/EC and 
Directive 2009/132/EC as regards certain value added tax obligations for supplies of services and distance 
sales of goods , p. 2. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:52016PC0757&from=en . The Commission noted, in 2017, that "It is 
estimated that Member States currently lose EUR  5 billion of VAT revenues annually due to non -compliance as 
well as the VAT foregone from the VAT exemption for the importation of small consignments". 
European  Commission, Modernising VAT for e -commerce: Question and Answer.  
389 European Commission, VAT on digital services (MOSS scheme).  Viewed at: 
https://europa.eu/youreurope/business/taxation/vat/vat -digital -services -moss-scheme/index_en.htm . WT/TPR/S/395 • European Union  
 
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  4.284.   The rules that became applicable from 1 January 2019 involve several changes designed to 
improve the operation of the MOSS.390 These include the introduction of a threshold of EUR 10,000 
for EU -wide sales, below which companies may charge VAT in the member State where the supplier 
is established; simplification of the rules regarding the evidence to be provided to prove the location 
of customers391; and a provision allowing the service supplier to us e the invoicing rules of a single 
member State (the member State of establishment) instead of having to use the invoicing rules of 
each member State of destination. They also amend the MOSS to make it applicable to taxable 
persons not established in the EU  but who have a VAT registration in a member State.  
4.285.   The changes made by the VAT rules adopted in December 2017 that will become applicable 
in January 2021392 provide that the special mechanism currently provided for under the MOSS will 
be extended to apply to other services and to distance sales of goods, including both 
intra-EU distance sales of goods and sales of goods from third countries or territories. Regarding 
distance sales of goods imported from third countries or territories, the new VAT rules subj ect such 
sales to VAT in the member State of the consumer and abolish the VAT exemption for low value 
consignments. For imports of goods in consignments with a value not exceeding EUR 150 and not 
subject to excise duties, compliance with VAT obligations wi ll be simplified through either the  special 
import scheme, the Import One Stop Shop mechanism (IOSS)393, whereby  VAT is no longer payable 
at the time of importation, but pre -paid at the time of purchase,  or through a special arrangement, 
whereby VAT is paid upon importation on a monthly basis. Finally, another major change made by 
the new VAT  rules is that businesses operating electronic interfaces, such as marketplaces or 
platforms, will be deemed to be suppliers of goods sold to customers in the EU by compa nies using 
the marketplace or platform , where those goods with a value up to EUR 150 are imported into the 
EU or when it concerns goods that are located in the EU and where the companies using the 
marketplace are not established in the EU.  This means that large marketplaces will be liable to 
ensure payment of VAT on sales of such goods.394 
4.286.   In addition to these measures aimed at improving compliance, the Commission also 
proposed in December 2018 a legislative package to request payment service providers establ ished 
in Europe to transmit VAT -relevant payment data to tax authorities. This proposal will require 
payment service providers such as banks, companies responsible for card payments and e -money 
institutions to provide tax authorities with information on th e beneficiary of cross -border payments. 
This information will then be centralised in a European database – the Central Electronic System of 
Payment information ("CESOP") - where tax authorities will be able to access the data to establish 
the amount of pay ments received by online sellers and crosscheck this information with other 
databases to identify fraudsters. Citizens ' rights will be preserved as no information on the 
payer/buyer will be collected and a threshold has been put in place to ensure only information 
relating to business receiving important amounts of payments is transmitted.  
4.4.3.2.3   Prohibition of unjustified geobl ocking  and other forms of discrimination based 
on customers' nationality, place of residence or place of establishment  
4.287.   As part of the package of measures designed to reduce barriers to cross -border e -commerce 
within the EU, the DSM Strategy envisaged the prohibition of practices involving unjustified 
geoblocking and other forms of geographically -based discrimination.  The term "geoblocking" refers 
to practices used for commercial reasons by online sellers that result in the denial of access to 
websites base d in other member States.395  
                                                
390 Council Directive (EU) 2017/2455, Art. 1 ; and Council Implementing Regulation (EU) 2017/2459, 
Art. 1. 
391 In this regard, the new rules provide that companies that make cross -border sales of 
telecommunications, broadcasting and electronic services to consumers in other EU member States at a total 
value o f less than EUR 100,000 per year must provide one piece, rather than two, of evidence to establish the 
location of their customers.  
392 Council Directive (EU) 2017/2455, Arts. 2 and 3 . 
393 See Section 3.1.1.  
394 The Council reached political agreement on two pro posals, submitted by the Commission in 
December 2018, designed to enable a smooth transition to the new VAT system that will apply from 
1 January  2021.  
395 European Commission, A Digital Single Market Strategy for Europe , p.6. The communication noted 
that " [b]y limiting consumer opportunities and choice, geo -blocking is a significant cause of consumer 
dissatisfaction and of fragmentation of the Internal Market".  WT/TPR/S/395 • European Union  
 
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  4.288.   A Regulation prohibiting unjustified geoblocking and other forms of discrimination entered 
into force in March 2018 and became applicable in December 2018.396 The core provisions of the 
Regulation are the following.397  
4.289.   Firstly, it defines three situations involving, respectively, the sale of goods without physical 
delivery, the sale of electronically -supplied services, and the sale of services provided in a physical 
location, in which traders are prohibited from applying different g eneral conditions of access to goods 
or services for reasons related to a customer's nationality, place of residence or place of 
establishment.398  
4.290.   Secondly, the Regulation provides that a trader shall not, through the use of technological 
measures or otherw ise, block or limit a customer's access to the trader's online interface for reasons 
related to the customer's nationality, place of residence or place of establishment. It also prohibits 
a trader from redirecting a customer to a version of its online inte rface that is different from the 
online interface to which the customer initially sought access, for reasons related to the customer's 
nationality, place of residence or place of establishment.  
4.291.   Thirdly, the Regulation prohibits a trader from applying diff erent conditions for certain 
payment transactions based on a customer's nationality, place of residence or establishment, the 
location of the payment account, the place of establishment of the payment service provider or the 
place of the payment instrument  within the EU.  
4.4.3.2.4   Regulatory oversight and transparency of cross -border parcel delivery services  
4.292.   The Commission's communication on the DSM Strategy identified high prices and inefficiency 
of cross -border delivery services as an obstacle to cross -border onl ine sales within the EU, and 
announced a set of measures to improve price transparency and enhance regulatory oversight of 
the cross -border parcel delivery market.399 A Regulation adopted in April 2018 lays down provisions 
to foster better cross -border parce l delivery services.400 These concern: (i)  regulatory oversight 
related to parcel delivery services; (ii) transparency of tariffs and assessment of tariffs for the 
purpose of identifying those that are unreasonably high; and (iii) information for consumers m ade 
available by traders concerning cross -border parcel delivery services.  
4.293.   Firstly, regarding regulatory oversight, the Regulation requires all parcel delivery service 
providers to submit certain information to the national regulatory authority of the mem ber State in 
which they are established.  As required by Article 4 of the Regulation, the Commission adopted an 
implementing act on the format for the submission of this information.401  
4.294.   Secondly, the Regulation gives national postal regulators the data they need to monitor 
cross-border markets and check the affordability and cost -orientation of prices. It requires all 
cross-border parcel delivery service providers to provide the national regulatory authority of the 
member States in which they are established with the public list of tariffs applicable on 1  January of 
each calendar year for the delivery of single -piece postal items. The national authorities are required 
                                                
396 Regulation (EU) 2018/302 of the European Parliament and of the Council of 28 February 2018 on 
addressing unjustified geo -blocking and other forms of discrimination based on customers' nationality, place of 
residence or place of establishment within the in ternal market and amending Regulations (EC) No. 2006/2004 
and (EU) 2017/2394 and Directive 2009/22/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TX T/PDF/?uri=CELEX:32018R0302&from=EN . 
397 Regulation (EU) 2018/302, Arts. 4,3 and 5.  
398 The Regulation applies to cross -border transactions and not to situations which are purely internal to 
a member State.  
399 European Commission, A Digital Single Market Strategy for Europe , pp.5 -6. The previous TPR noted 
that p rices charged by postal operators to deliver a small parcel to another member State were on average 
three to five times higher than domestic prices, without a clear correlation to the actual cost. W TO document 
WT/TPR/S/357/Rev.1, 13 October 2017, para. 4.117.  
400 Regulation (EU) 2018/644 of the European Parliament and of the Council of 18 April 2018 on 
cross-border parcel delivery services. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32018R0644&from=EN . 
401 Commission Implementing Regulation (EU) 2018/1263 of 20 September 2018 establishing the forms 
for the submission of informatio n by parcel delivery service providers pursuant to Regulation (EU) 2018/644 of 
the European Parliament and of the Council. Viewed at: 
http://www.ancom.org.ro/uploads/lin ks_files/Regulation_2018_ -_1263.pdf . WT/TPR/S/395 • European Union  
 
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  to submit this information to the Commission, which must publish it on a dedicated website.402 
National regulatory authorities are also required to conduct an assessment of whether cross -border 
tariffs of the parcel delivery service providers subject to a universal service obligation are 
unreasonably high, based on a list of factors set out in the R egulation403, to be evaluated in 
accordance with a methodology for which the Commission set out guidelines in a communication 
issued in December 2018.404  
4.295.   Thirdly, for certain contracts, traders concluding sales contracts with consumers that include 
the sending of cross -border parcels are obligated to make available to consumers, at the 
pre-contractual stage, information on the cross -border delivery options in relation to the specific 
sales contract and charges payable by consumers for the cross -border pa rcel delivery and, where 
applicable, their own complaints handling procedures.  
4.4.3.2.5   Harmonization of contract and consumer protection laws  
4.296.   A Directive on certain aspects concerning contracts for the supply of digital content and the 
provision of digital servi ces405 and a Directive on certain aspects concerning contracts for the sale of 
goods406 entered into force in June 2019. Member States have until 1 July 2021 to adopt and publish 
the measures provided for in these Directives, and are required to apply them fro m 1 January 2022.  
4.297.   As discussed in the previous Review407, these two Directives aim to address obstacles to the 
development of cross -border e -commerce within the EU that arise from differences between national 
consumer protection and contract laws. When it s ubmitted the proposals for these Directives in 
December 2015 , the Commission observed that , for nearly 40% of retailers selling online , differences 
in national contract laws were a significant obstacle to cross -border sales, with the additional one -off 
cost for businesses to adapt to different consumer contracts laws when selling cross -border 
amounting to around EUR 9 ,000 for each member State they wished to sell to. It also noted that 
three out of ten consumers' top concerns in respect of buying online per tained to key contract rights, 
such as non -delivery of their order, delivery of a wrong or damaged  product, or the repair and 
replacement of a faulty product; and only 10% of 70 million EU consumers who had experienced 
problems with four popular types of d igital content had received remedies.408  
4.298.   The two Directives provide for a full harmonization of rules on certain essential elements of 
consumer contract law, notably rules on the conformity of the digital content, digital service or good 
with the contract, remedies in the case of a lack of such conformity, and the modalities for the 
exercise of those remedies.  
4.299.   The two Directives are designed to be complementary to each other in terms of their scope 
of application. The Directive on digital content and digital  services "applies to the supply of digital 
content or digital services, including digital content supplied on a tangible medium, such as DVDs, 
CDs, USB sticks and memory cards, as well as to the tangible medium itself, provided that the 
                                                
402 European Commission, Public tariffs on cross -border parcel delivery services . Viewed at: 
https://ec.eu ropa.eu/growth/sectors/postal -services/parcel -delivery/public -tariffs -cross-border_en . 
403 Regulation (EU) 2018/644, Art. 6(2), of the European Parliament and of the Council of 18 April 2018 
on cross -border parcel delivery services. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32018R0644&from=EN . 
404 European Commission, Communication from the Commission on guidelines to natio nal regulatory 
authorities on the transparency and assessment of cross -border parcel tariffs pursuant to Regulation (EU) 
2018/644 and Commission Implementing Regulation (EU) 2018/1263.  Viewed at: https://eur -
lex.europa.eu/resource.html?uri=cellar:4fd5f9aa -fdf8-11e8-a96d-
01aa75ed71a1.0023.02/DOC_1&format=PDF . 
405 Directive (EU) 2019/770 of the European Parliament and of the Council o f 20 May 2019 on certain 
aspects concerning contracts for the supply of digital content and digital services. Viewed at: https://eur -
lex.euro pa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32019L0770&qid=1570782546972&from=EN . 
406 Directive (EU) 2019/771 of the European Parliament and of the Council of 20 May 2019 on certain 
aspects concerning contracts for the sale of goods, amending Regulation (EU) 2 017/2394 and Directive 
2009/22/EC, and repealing Directive 1999/44/EC. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CEL EX:32019L0771&qid=1570782682095&from=EN . 
407 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, paras. 4.108 -113. 
408 European Commission, Digital Contracts for Europe.  Viewed at:  
https://ec.europa.eu/info/sites/info/files/digital_contracts_factsheet_en.pdf . WT/TPR/S/395 • European Union  
 
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  tangible medium se rves exclusively as a carrier of the digital content".409 The Directive on contracts 
for the sale of goods applies to "contracts for the sale of goods, including goods with digital elements 
which require digital content or a digital service in order to perform their function".410  
4.300.   The Directive on certain aspects of contracts for the supply of digital content and digital 
services defines the obligation of the trader to supply the digital content or digital service, lays down 
requirements for the digital content or digital service to be considered to be in conformit y with the 
contract, and defines the conditions under which the trader is liable for the failure to supply the 
digital content or digital service or for the lack of conformity of the digital content or service with 
the contract.411 In the latter regard, the Directive provides that the trader is liable for any failure to 
supply the digital content or digital service, and defines the conditions under which the trader is 
liable for a lack of conformity of the digital content or digital service with the contract.  Similarly, it 
provides that the burden of proof with regard to whether the digital content or service was supplied 
lies with the trader, and defines when the burden of proof is on the trader with regard to whether 
the digital content or digital service wa s in conformity with the contract.412  
4.301.   Regarding remedies, the Directive provides that, in the case of a failure to supply, the 
consumer shall call upon the trader to supply the digital content or digital service without undue 
delay and that, if the trader t hen fails to supply the digital content or digital service without undue 
delay, the consumer shall be entitled to terminate the contract. In the case of a lack of conformity 
of the digital content or digital service with the contract, the consumer has the right to have the 
digital content or service brought into conformity, to receive a proportionate reduction in the price, 
or to terminate the contract under conditions specified in the Directive.413  
4.302.   The Directive on certain aspects of contracts for the sale of goods414 defines the obligation 
of the seller to deliver the goods in accordance with subjective and objective requirements of 
conformity with the sales contract, and provides that the seller is liable to the consumer for any lack 
of conformity which exis ts at the time when the goods were delivered or which becomes apparent 
within two years of that time. Regarding the burden of proof, the Directive provides that any lack of 
conformity which becomes apparent within one year of the time when the goods were d elivered shall 
be presumed to have existed at the time when the goods were delivered. In the case of a lack of 
conformity, the consumer shall be entitled to have the goods brought into conformity or to receive 
a proportionate reduction in price or to termi nate the contract under the conditions defined in the 
Directive.415 The Directive also contains requirements with respect to commercial guarantees.  
4.303.   The harmonization of contract laws under the two Directives entails significant improvements 
in the rights of  consumers, including, for example, the reversal of the burden of proof with respect 
                                                
409 The term "digital content" is defined as "data which produced and supplied in digital form", and 
"digital service" as either "a service that allows a consumer to create, process, store or access data in digital 
form", or "a service that allows the sharing of or any other interaction with data in digital from uploaded or 
created by the consumer or other users of that service". Directive (EU)2019/770, Arts. 2(1) and (2). 
410 The term "goods with digital elements" means "any tangible movable items that incorporate, or are 
inter-connected with, digital content or a digital service in such a way that the absence of that digital content 
or digital service would prevent the goods from performing their functions". Directive (EU)2019/770, Art. 2 (3) . 
411 Directive (EU) 2019/770, Arts. 5 -8 and 11 . 
412 Directive (EU) 2019/770, Art. 12 . 
413 Directive (EU) 2019/770, Arts. 13 and 14 . 
414 This Directive applies to sales contracts between a consume r and a seller. As stated in the Preamble, 
"while online sales of goods constitute the vast majority of cross -border sales in the Union, differences in 
national contract laws equally affect retailers using distance sales channels and retailers selling face -to-face 
and prevent them from expanding across borders. This Directive should cover all sales channels, in order to 
create a level playing field for all businesses selling goods to consumers". Directive (EU) 2019/771, Preamble, 
recital 9 . 
415 Directive (EU)  2019/771, Arts. 10, 11 and 13.  WT/TPR/S/395 • European Union  
 
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  to the existence of a defect at the time of the supply of a digital content or a digital service416 or the 
supply of a good, and the provision of more effective remedies in the case of a lack of conformity.417  
4.4.4   Telecommunications services  
4.4.4.1   Telecommunications in the context of the DSM Strategy  
4.304.   The second pillar of the DSM Strategy aims to create the right conditions and a level playing 
field for advanced digital networks and in novative services. The European Commission's 
communication on the Strategy noted that it must be built on reliable, trustworthy, high -speed, 
affordable networks and services which must safeguard consumers' fundamental rights to privacy 
and personal data pr otection while also encouraging innovation. This required a strong, competitive 
and dynamic telecoms sector to carry out the necessary investments. Moreover, the market power 
of some online platforms potentially raised concerns. The communication identifie d a comprehensive 
overhaul of EU telecoms rules  as one of the main priority areas under this pillar.418  
4.305.   As part of this second pillar, the Commission adopted a communication and a set of related 
proposals in September 2016, designed to achieve the objective  of very high -capacity Internet 
connectivity.419 This communication set out three strategic, non -binding objectives for network 
deployment by 2025:  
• gigabit connectivity420 for all main socio -economic drivers, e.g. schools, transport hubs, 
main providers of pu blic services, and digitally -intensive enterprises;  
• all urban areas and all major terrestrial transport paths to have uninterrupted 5G 
coverage; and  
• all European households, rural or urban, to have access to Internet connectivity offering 
a downlink of at least 100 Mbps, upgradable to gigabit speed.  
4.306.   The Commission estimated, in 2016, that these objectives required an additional investment 
of circa EUR 155 billion.421  
4.307.   For European households, broadband take -up and coverage increased from 22.6% in 2016 
to 29.6 % in 2018.422  
                                                
416 For example, as pointed out in the Secretariat Report prepared for the previous Review, if a 
consumer discovers today that a product s/he purchased online more than six months ago is defective and 
asks the seller to repair  or replace it, s/he may be asked to prove that this defect existed at the time of 
delivery; in contrast, under the new rules, throughout the two -year guarantee period, the consumer will be 
able to ask for a remedy without having to prove that the defect e xisted at the time of delivery.  
417 European Commission, Digital Contracts.  Viewed at: 
https://ec.europa.eu/info/sites/info/files/factsheet_digital_contracts.pdf .  
418 European Commission, A Digital Single Market Strategy for Europe , pp. 9-13. Other priorities 
identified in this context were: reform of the Audiovisual Media Services Directive to create a media framework 
for the 21st century; creation of a fit -for-purpos e regulatory environment for platforms and intermediaries; and 
measures to reinforce trust and security in digital services and in the handling of personal data. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:52015DC0192&from=EN . 
419 European Commission, Connectivity for a Competitive Digital Single Market. Towards a European 
Gigabit Society . Viewed at: https://ec.europa.eu/transparency/regdoc/rep/1/2016/EN/1 -2016-587-EN-F1-
1.PDF . 
420 Defined as "cost -effective symmetrical Internet connectivity offering a downlink and an uplink of at 
least 1 Gbps".  
421 European Commission, Connectivity for a Competitive Digital Single Market. Towards a European 
Gigabit Society,  p. 8. Viewed at: https://ec.europa.eu/transparen cy/regdoc/rep/1/2016/EN/1 -2016-587-EN-
F1-1.PDF . 
422 European Commission, Digital Agenda Scoreboard key indicators - See the evolution of an indicator 
and compare countries.  Viewed at: https://digital -agenda -data.eu/charts/see -the-evolution -of-an-indicator -
and-compare -countries#chart={"indicator -
group":"broadband","indicator":"bb_fttpcov","breakdown":"total_pophh","unit -measure":"pc_hh_all","ref -
area":["EU","EU"]} . WT/TPR/S/395 • European Union  
 
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  4.308.   During the period under review, the main developments regarding the implementation of 
this second pillar of the DSM Strategy were:  
• abolition of retail roaming charges (June 2017);  
• Decision on the use of the 470 -790 MHz frequency band in the U nion (May 2017);  
• Regulation on the promotion of Internet connectivity in local communities  (October 2017);  
• Commission Recommendation on measures to effectively tackle illegal content online 
(March 2018);  
• Directive amending the Audiovisual Media Services D irective  (November 2018)  
(Section  4.4.6) ;  
• Directive establishing the European Electronic Communications Code (December 2018);  
• Regulation establishing the Body of European Regulators for Electronic Communications 
(BEREC) and the Agency for Support for BEREC (BEREC Office ) (December 2018); and  
• Regulation on fairness and transparency for business users of online intermediation 
services (June 2019)  (Section 4.4.5) .  
4.4.4.2   Reform of telecoms rules: the European Electronic Communications Code  
4.309.   Table 4.23 provides data on selected indicators of recent developments in the telecoms 
sector.  
Table 4.23 Selected indicators of developments in the telecoms sector , 2010 -18 
 2010  2011  2012  2013  2014  2015  2016  2017  2018  
Mobile phone 
subscribers (million)  616 639 660 672 687 689 698 n.a. n.a. 
Total telephone 
subscribers (fixed & 
mobile) (million)  829 840 846 851 843 833 833 832 828 
Households with 
broadband access - 
% of households 
with at least one 
member aged 16 to 
74a 61 67 72 76 78 80 83 85 86 
Level of Internet 
access – % of 
householdsb 70 73 76 79 81 83 85 87 89 
Internet use by 
individuals - % of 
individuals aged 16 
to 74c 68 71 73 75 78 79 82 84 85 
Individuals using 
mobile devices to 
access the Internet 
on the moved n.a. 21 36 43 51 57 59 65 69 
Individuals using 
Internet to order 
goods or services - 
%e 40 42 44 47 50 53 55 57 60 
Total a vailability of 
computer – % of 
householdsf 74 76 78 80 n.a 82 n.a. 84 n.a. 
Telecom service revenue  
Overall           
 EUR bng .. 253.1  245.0  233.9  226.3  223.5  222.3  222.6  .. 
 % growth (y-o-y) .. .. -3.2 -4.5 -3.2 -1.3 -0.5 0.1 .. WT/TPR/S/395 • European Union  
 
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   2010  2011  2012  2013  2014  2015  2016  2017  2018  
By type of service  
% growth (y-o-y)          
 Fixed telephony  .. .. -8.4 -8.3 -7.7 -6.4 -6.3 -6.4 .. 
 Mobile  .. .. -2.5 -5.7 -4.7 -1.8 -0.1 0.8 .. 
 N Fixed broadband  .. .. 0.6 1.4 3.2 3.5 2.7 3.0 .. 
n.a. Not applicable.  
.. Not available.  
a Eurostat. "The availability of broadband is measured by the percentage of households that are 
connectable to an exchange that has been converted to support xDSL -technology, to a cable 
network upgraded for Internet traffic, or to other broadband technologies. It includes fixed and 
mobile connections" . Viewed at: 
https://ec.europa.eu/eurostat/tgm/tabl e.do?tab=table&init=1&plugin=1&language=en&pcode=tin00
073. 
b "Percentage of households who have Internet access at home. All forms of Internet use are included. 
The population considered is aged 16 to 74" . Viewed at: 
https://ec.europa.eu/eurostat/tgm/table.do?tab=table&init=1&plugin=1&language=en&pcode=tin00
134. 
c "Last update:  03 July 2019. Last Internet use: within last 3 months, 12 months befor e the survey, 
ever used, never used - whether at home, at work or from anywhere else and whether for private or 
work/business related purposes" . Viewed at: 
https://ec.europa.eu/eurostat/tgm/table.do?tab=table&init=1&plugin=1&language=en&pcode=tin00
028. 
d "Use of mobile devices via mobile or wireless c onnection: mobile phone (or smart phone), portable 
computer (e.g. laptop, tablet) or another mobile device (e.g. PDA, e -book reader) away from home 
or work." Viewed at: 
https://ec.europa.eu/eurostat/tgm/table.do?tab=table&init=1&plugin=1&language=en&pcode=tin00
083. 
e Eurostat. Viewed at: 
https://ec.europa.eu/eurostat/tgm/table.do?tab=table&init=1&language=en&pcode=tin00096&plugi
n=1. 
f Eurostat. Total percentage of h ouseholds having  access to , via one of its members, a computer . 
Viewed at: https://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=isoc_ci_cm_h&lang=en .  
g European Telecommunic ations Network Operators ' Association (ETNO) , Annual Economic  Report, 
2017. Viewed at: https://etno.eu/datas/publicat ions/economic -
reports/ETNO%20Annual%20Economic%20Report%202017%20(final%20version%20web).pdf . 
Source:  Information compiled by the WTO Secretariat from sources listed in the footnote; and information 
provided by the authorities.  
4.310.   The implementation of the DS M Strategy resulted in a major reform of EU rules governing 
the functioning of the telecommunications infrastructure and services markets423, with the adoption, 
in December 2018, of a new European Electronic Communications Code (recast) (EECC).424 Member 
State s have until 21 December 2020 to adopt and publish the laws, regulations and administrative 
provisions necessary to comply with the EECC.  
4.311.   The adoption of the EECC was the outcome of a major periodic review of the 
EU telecommunications framework, undertake n in the context of the DSM Strategy and which aimed 
to adapt the existing rules to new technological and market developments. In this regard, the 
Strategy called for an ambitious overhaul of the telecoms regulatory framework focused on five 
priorities: (i ) a consistent single market approach to spectrum policy and management; (ii) creating 
the conditions for a true single market by tackling regulatory fragmentation to allow economies of 
scale for efficient networks and service providers, and effective prot ection of consumers; 
(iii) ensuring a level playing field for market players, and consistent application of the rules; 
(iv) incentivizing investment in high -speed broadband networks; and (v) a more effective regulatory 
institutional framework.425  
                                                
423 The EU regulatory framework for telecommunications was described in previous reports: 
WTO documents WT/TPR/S/317/Rev.1, 21 October 2015, pp. 138 -144; and WT/TPR/S/248/Rev.1, 
1 August  2011, pp. 131 -132. 
424 Directive (EU) 2018/1972 of the European Parliament  and of the Council of 11 December 2018 
establishing the European Electronic Communications Code (recast). Viewed at: https://eur -
lex.europa.eu/legal -content/E N/TXT/PDF/?uri=CELEX:32018L1972&from=EN . 
425 European Commission, A Digital Single Market Strategy for Europe,  p.10 WT/TPR/S/395 • European Union  
 
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  4.312.   Whereas th e current EU telecoms regulatory framework mainly consists of four Directives, 
originally adopted in 2002 and last amended in 2009, on access426, authorization427, framework428 
and universal service429, the EECC amends and integrates these Directives into a single  instrument. 
The rationale for the adoption of a single legal instrument is that "[t]he convergence of the 
telecommunications, media and information technology sector means that all electronic 
communications networks and services should be covered to the e xtent possible by a single 
European electronic communications code established by means of a single Directive".430  
4.313.   The EECC expands the scope of application of EU telecoms regulation, in line with the 
principle of technological neutrality and to keep pace w ith technological development. It applies to 
"electronic communications services", i.e. services "normally provided for remuneration via 
electronic communications networks", which it defines as including three types of services: Internet 
access; interperso nal communications services; and services consisting wholly or mainly of the 
conveyance of signals.431  
4.314.   The introduction of the concept of "interpersonal communications services"432 means that 
the EECC covers services provided through digital messaging platfor ms that, in recent years, have 
increasingly displaced more traditional communication services, such as voice telephony and 
SMS services. It should be noted, however, that the EECC distinguishes between interpersonal 
communications services which connect wi th publicly -assigned numbering resources (number -based 
interpersonal communications services) and interpersonal communications services which do not 
connect with publicly -assigned numbering resources (number -independent interpersonal 
communications service s), and imposes more stringent regulatory obligations in respect of 
number -based services than on number -independent services.433 End-user-related regulatory 
obligations apply to Internet access and number -based interpersonal communications services, 
whereas , in the case of number -independent interpersonal communications services, regulatory 
obligations are mostly limited to security obligations.  
4.315.   Another aspect of the expansion of the scope of EU telecoms regulation under the EECC is 
that it broadens the con cept of "remuneration" on the grounds, inter alia , that "[i]n the digital 
economy market participants increasingly consider information about users as having monetary 
value". Thus, the provision of information and the exposure to advertising are included as forms of 
remuneration.  
4.316.   A central objective of the EECC is to contribute to the creation of the additional capacity in 
high-speed broadband networks necessary to achieve the strategic Internet connectivity objectives 
set by the EU Commission in 2016. In this respect, the EECC includes access to, and de ployment of, 
very high -capacity networks as a new general objective, in addition to the three existing primary 
                                                
426 Directive 2002/19/EC of the European Parliament and of the Council of 7 March 2002 on access to, 
and interconnection of, electronic communications networks and associated facilities (Access Directive). Viewed 
at: https://eur -lex.europa.eu/legal -content/EN/ALL/?uri=CELEX%3A32002L0019 . 
427 Directive 2002/20/EC of the European Parliament and of the Council of 7 March 2002 on the 
authoriation of electronic communication networ ks and services (Authorisation Directive). Viewed at: 
https://eur -lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2002:108:0021:0032:EN:PDF . 
428 Directive 2 002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common 
regulatory framework for electronic communications networks and services (Framework directive). Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/?uri=CELEX%3A32002L0021 . 
429 Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal 
service and users' rights relating to electronic communications networks and services (Universal Service 
Directive). Viewed at: https://eur -lex.europa.eu/legal -content/en/TXT/?uri=CELEX:32002L0022 . 
430 Directive (EU) 2018/1972, Preamble,  recital 7.  
431 Directive (EU) 2018/1972, Art. 2(4) . 
432 The EECC defines "interpersonal communications service" as "a service normally provided for 
remuneration that enables direct interpersonal and interactive exchange of information via electronic 
communications networks between a finite number of persons, w hereby the persons initiating or participating 
in the communication determine its recipient(s) and does not include services which enable interpersonal and 
interactive communication merely as a minor ancillary feature that is intrinsically linked to anothe r service". 
Directive (EU) 2018/1972 , Art. 2(5) . 
433 Directive (EU) 2018/1972, Art. 2( 6) and ( 7). The Preamble, recital 18, states that "[n]umber -
independent interpersonal communications services should be subject to obligations only where public interests 
require that specific regulatory obligations apply to all types of interpersonal communications services, 
regardless of whether they use numbers for the provision of their service. It is justified to treat number -based 
interpersonal communications services differently, as they participate in, and hence also benefit from, a 
publicly assured interoperable ecosystem".  WT/TPR/S/395 • European Union  
 
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  objectives of promoting competition, contributing to the development of the internal market, and 
promoting the interests of the citizens of the E U.  
4.317.   Article 3 of Directive (EU) 2018/1972 states that the national regulatory authorities, other 
competent authorities, the Body of European Regulators for Electronic Communications (BEREC), 
the European Commission and the member States shall, inter alia , "promote connectivity and access 
to, and take -up of, very high capacity networks, including fixed, mobile and wireless networks, by 
all citizens and businesses of the Union". A very high -capacity network "means either an electronic 
communications network w hich consists of wholly of optical fibre elements at least up to the 
distribution point at the serving location, or an electronic communications network which is capable 
of delivering under usual peak -time conditions similar network performance in terms of  available 
downlink and uplink bandwidth, resilience, error -related parameters, and latency and its 
variation".434 
4.318.   The EECC requires national regulators to conduct a geographical survey of the reach of 
networks capable of delivering broadband by 21 December 2023, and to update it every three years. 
On the basis of the information obtained in this survey, regulators may designate areas where no 
very high -capacity network is planned, organize calls for the deployment of high -capacity networks 
in such areas, and  apply penalties where an undertaking or a public authority which has declared its 
intention to deploy a very high -capacity network fails to do so.435  
4.319.   To achieve this objective, the EECC also creates incentives for private investment in such 
networks by pro viding for more flexible regulation in certain areas436:  
• the deployment of high -capacity networks is one of the factors to be considered by national 
regulators in carrying out their responsibilities, to encourage and ensure adequate access 
and interconnecti on. National regulators may exempt certain providers from access and 
interconnection obligations if such providers make available a viable and similar alternative 
means of reaching end -users by providing access to a very high -capacity network;  
• investment in very high -capacity networks is also a factor to be considered by national 
regulators in determining whether to impose obligations of access to, and use of, specific 
networks and associated facilities on undertakings with significant market power. 
Simila rly, where national regulatory authorities impose upon undertakings with significant 
market power obligations regarding the prices at which such undertakings provide access 
to other operators, the authorities are required to take into account the investmen t made 
by the undertaking in very high -capacity networks;  
• the EECC provides that undertakings with significant market power may offer 
commitments to open the deployment of new very high -capacity networks to 
co-investment and that, if such co -investment me et certain specified conditions, 
regulatory authorities may not impose additional access obligations regarding the 
elements of the very high -capacity network subject to the commitment;  
• the EECC also reduces access obligations in the case of wholesale marke t players with 
significant market power that make private investments in networks and sell or rent access 
to those networks without offering services to end -users; and  
                                                
434 Directive (EU) 2018/1972, Art.2(2). Under Article 82 of the Directive, the BEREC is required, by 
21 December  2020, to issue guidelines on the c riteria that a network is to fulfil in order to be considered a very 
high-capacity network.  
435 Directive (EU)2018/1972, Arts. 22 and 29.  
436 It should be noted that the objective of promoting investment in high -capacity networks is also 
promoted by the Connec ting Europe Broadband Fund and the the Connecting Europe Facility (CEF). In addition, 
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  • to provide more predictability for investors, the period after which national regulators  are 
required to review a determination that an undertaking has significant market power has 
been extended from three to five years.437  
4.320.   The EECC aims to increase coordination and coherence of radio spectrum management in 
the EU. This is motivated by a conce rn that radio spectrum management by member States has 
resulted in widely different conditions, and that the lack of consistent EU -wide objectives and criteria 
for the assignment of radio spectrum at the member State level has created barriers to entry, 
hindered competition and reduced predictability for investors.438 A more harmonized approach to 
the assignment of radio spectrum is seen as being particularly important in light of the growing 
demand for spectrum due to the increase in wireless traffic.  
4.321.   In addition to requiring member States to cooperate with each other regarding the strategic 
planning and coordination of radio spectrum policy, the EECC requires them to promote the 
harmonization of the use of radio spectrum by electronic communications network s and services 
across the EU, and to act in accordance with certain objectives and principles in this regard.439 The 
EECC provides that member States shall facilitate the use of radio spectrum under general 
authorizations but allows for the granting of indiv idual rights of use in certain circumstances. It 
provides detailed rules on the conditions that may be attached to the granting of individual rights, 
the procedures for granting such rights, and their duration and renewal. Member States are obliged 
to ensu re that rights to use radio spectrum are valid for at least 15 years, with the possibility of an 
extension of five years.440  
4.322.   The EECC significantly alters the scope of universal service obligations. The Universal Service 
Directive of 2002 provides for unive rsal service obligations, defined in terms of connection to the 
public telephone network and access to publicly -available telephone services. In contrast, the EECC 
defines universal service obligations in terms of access, at an affordable price, in light o f specific 
national conditions, to an available adequate broadband Internet access service and to voice 
communication services.441  
4.323.   The EECC strengthens the protection of rights of consumers in several respects. As a result 
of the expansion of the scope of t he framework, protection of end -user rights applicable to traditional 
telecommunications services will also apply to non -traditional equivalent communications services, 
mainly Internet access services and number -based interpersonal communications services:   
• the EECC provides for greater clarity regarding contracts, by identifying the information 
that providers of publicly -available electronic communications services operators are 
required to provide before a consumer is bound by a contract or any correspond ing offer. 
This includes a requirement to provide a concise and easily -readable summary of that 
information;  
• it requires regulatory authorities to ensure that providers of Internet access services or 
publicly -available interpersonal communication services  publish information on the terms 
and conditions of their services, and that end -users have access, free of charge, to at least 
one independent tool that enables them to compare and evaluate different Internet access 
services and publicly -available number -based interpersonal communications services;  
                                                
437 Directive (EU)  2018/1972, Arts. 61, 73, 74, 76, 80, 67. Other  elements of the EECC, specifically 
designed to create incentives for investment in high -capacity networks, include, in particular, Arts. 79 
(commitments procedure) and 81 (migration from legacy infrastructure).  
438 European Commission, A Digital Single Marke t Strategy for Europe,  p.9.  
439 Directive (EU) 2018/1972, Art. 45.  
440 Directive (EU) 2018/1972, Arts. 46 -49. 
441 Directive (EU)  2018/1972, Art. 84(1). "Member States shall ensure that all consumers in their 
territories have access at an affordable price, in li ght of specific national conditions, to an available adequate 
broadband Internet access service and to voice communications services at the quality specified in their 
territories, including the underlying connection, at a fixed location." A voice communica tions service is "a 
publicly available electronic communications service for originating and receiving, directly or indirectly, national 
or national and international calls through a number or numbers in a national or international numbering plan." 
Directi ve (EU) 2018/1972, Art. 2(32).  WT/TPR/S/395 • European Union  
 
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  • in order to ensure that conditions and procedures for contract termination do not act as a 
disincentive to changing service provider, the EECC limits the maximum contractual 
commitment period to 24 months;  
• it also allows consumers to terminate the contrac t immediately if conditions have been 
changed, with the possibility of keeping the number for one month after terminating the 
contract;  
• it improves the rules on transparency and switching applicable to contracts involving 
bundles of services, including In ternet, voice communication and television;  
• it ensures more accurate caller location in emergency situations when phoning the 
European emergency number 112;  
• it requires national regulatory authorities to ensure that providers of publicly -available 
electro nic communications services provide equivalent access to communication services 
to end -users with disabilities.442 
4.324.   The EECC reinforces the role of national regulatory authorities. It requires member States 
to ensure that national regulatory and other compete nt authorities undertake a list of specified tasks, 
including implementing ex ante  market regulation, ensuring the resolution of disputes between 
undertakings, carrying out radio spectrum management and decisions, contributing to the protection 
of end -user rights, and assessing and monitoring market -shaping and competition issues regarding 
open market access. The EECC also contains provisions aimed at reinforcing the independence of 
the national regulatory and other competent authorities to ensure the impar tiality of their 
decisions.443  
4.325.   In addition to the adoption of the new EECC, the revision of the EU telecoms rules adopted 
in December 2018 include new rules aimed at creating a more effective institutional framework by 
strengthening the role of the BEREC.444  
4.326.   Finally, as part of the reform of telecoms rules, certain price caps apply as from 
15 May 2019: 19 cents per minute (+VAT) prices for international calls within the EU to and 6 cents 
per minute (+VAT) for SMS messages.  
4.4.4.3   Other measures in the field of tele communications  
4.4.4.3.1   Use of the 470 -790 MHz frequency band  
4.327.   The European Commission's communication on the DSM Strategy stressed the importance 
of the 694 -790 MHz ("700 MHz") frequency band for ensuring the provision of broadband services 
in rural areas, and an nounced that the Commission would make specific proposals for the 
coordinated release of the 700 MHz band, while accommodating the specific needs of audio -visual 
media distribution.445 A Decision on this subject of the European Parliament and of the Council,  dated 
17 May 2017, requires member States to allow the use of the 700 MHz frequency band for wireless 
broadband electronic communications services by June 2020, subject to the possibility of a delay of 
                                                
442 Directive (EU) 2018/1972, Arts. 102 -103, 105 -107, 109.  
443 Directive (EU) 2018/1972, Arts. 5 -9. 
444 Regulation (EU) 2018/1971 of the European Parliament and of the Council of 11 December 2018 
establishing the Body of European Regulators for Electronic Communications (BEREC) and the Agency for 
Support for BEREC (BEREC Office), amending Regulation (EU) 20 15/2120 and repealing Regulation (EC) 
No. 1211/2009. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32018R1971&from=EN . 
445 European Co mmission, A Digital Single Market Strategy for Europe,  p.10.  WT/TPR/S/395 • European Union  
 
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  up to two years for certain justified reasons.446 The a vailability of this band in 2020 for broadband 
wireless services is seen as a critical step in the deployment of 5G.447 
4.4.4.3.2   Abolition of retail roaming charges  
4.328.   As at 15 June 2017, roaming charges were abolished for customers travelling periodically 
within the E U, in accordance with a Regulation adopted in November 2015.448 In order to avoid 
negative effects of abusive use of regulated retail roaming services by roaming customers, the 
Regulation allows roaming providers to apply a "fair use" policy. Detailed rules and conditions on 
this "fair use" policy are laid down in an Implementing Regulation adopted in December 2016.  
4.4.4.3.3   Promotion of Internet connectivity in local communities   
4.329.   In pursuance of its Internet connectivity objectives, and specifically with a view to p romoting 
"digital inclusion", the EU launched an initiative in 2017 to provide support, in the form of grants 
and/or other types of financial assistance, for the provision of high -quality local wireless connectivity, 
free of charge and without discriminati on, in centres of local public life.449 Such financial assistance 
is available to public sector bodies that meet certain conditions. Under this initiative, municipalities 
can apply for vouchers up to a value of EUR 15,000.450 The total amount of funding availa ble under 
this initiative is EUR 120 million over the period 2018 -20. 
4.4.5   Other measures adopted during the review period under the second pillar of the 
DSM Strategy  
4.4.5.1   Online platforms  
4.330.   The European Commission issued a communication in 2016 that provided its overall 
assessment of online platforms as part of its DSM Strategy.451 This communication also set out 
certain basic principles: (i) a level playing field for comparable digital services; (ii) responsible 
behaviour of online platforms to protect core values;  (iii) transparency and fairness for maintaining 
user trust and safeguarding innovation; and (iv) open and non -discriminatory markets in a 
data-driven economy.  
4.331.   On 1 March 2018, the Commission adopted a non -binding Recommendation on measures to 
effectively  tackle illegal content online.452 The Recommendation follows up on a communication of 
28 September 2017 that provides guidance on the responsibilities of online service providers 
regarding illegal content online. It encourages member States and hosting serv ice providers to take 
effective, appropriate and proportionate measures to tackle illegal content online. It is based on the 
e-Commerce Directive453, which exempts hosting service providers from liability if the provider does 
                                                
446 Decision (EU) 2017/899 of the European Parliament and of the Council of 17 May 2017 on the use of 
the 470 -790 MHz frequency band in the Union. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017D0899&from=en . 
447 European Commission, 5G for Europe: An Action Plan and accompanying Staff Working Document.  
Viewed at:  https://ec.europa.eu/digital -single -market/en/news/communication -5g-europe -action -plan-and-
accompanying -staff-working -docum ent. 
448 Regulation (EU) 2015/2120 of the European Parliament and of the Council of 25 November 2015 
laying down measures concerning open Internet access and amending Directive 2002/222/EC on universal 
service and users' rights relating to electronic communi cations networks and services and Regulation (EU) 
No. 531/2012 on roaming on public mobile communications networks within the Union. Viewed at: https://eur -
lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32015R2120&from=EN . 
449 Regulation (EU) 2017/1953 of the European Parliament and of the Council of 25 October 2017 
amending Regulations (EU) No. 1316/2013 and (EU) No. 283/2014 as regards the promotion of Internet 
connectivity in local communities. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32017R1953&from=EN . 
450 European Commission, WiFi4EU – Free Wi -Fi for Europeans . Viewed at: https://ec.europa.eu/digital -
single -market/en/wifi4eu -free-wi-fi-europeans . 
451 European Commission, Online Platforms and the Digital Single Market. Opportunities and Challenges 
for Europe. Viewed at:  https://ec.europa.eu/transparency/regdoc/rep/1/2016/EN/1 -2016-288-EN-F1-1.PDF . 
452 Commission Recommendation of 1 March 2018 on measures to effectively tackle illegal content 
online Viewed at: https://www.isdc .ch/media/1585/8 -
commissionrecommendationonmeasurestoeffectivelytackleillegalcontentonline -1.pdf. 
453 Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal 
aspects of information society services, in particular el ectronic commerce, in the Internal Market (Directive on WT/TPR/S/395 • European Union  
 
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  not have actual knowledge of ill egal activity or information and is not aware of facts or circumstances 
from which the illegal activity or information is apparent, or if the provider acts expeditiously to 
remove or to disable access to the illegal information upon obtaining such knowledg e or awareness.  
4.332.   Chapter II of the Recommendation relates to all types of illegal content, and provides for 
mechanisms to submit notices, whereby a notice provider requests a hosting service provider, on a 
voluntary basis, to remove or disable access to co ntent that the notice provider considers to be 
illegal. The Chapter provides detailed guidance with respect to matters such as the content of the 
notice; the information to be provided to the content provider if the hosting service provider decides 
to remo ve or disable access to the content; the transparency of the hosting service provider's policies 
in respect of the removal or the disabling of access to online content; proactive measures to be 
taken by hosting service providers; and safeguards that avoid the removal of content that is not 
illegal. Provision is also made for cooperation between member States and hosting service providers, 
and between hosting service providers.  
4.333.   In addition to these provisions that apply to all types of illegal content, the R ecommendation 
contains specific provisions on terrorist content in Chapter III.454 It states that hosting service 
providers should expressly set out in their terms of service that they will not store terrorist content, 
and should take measures so that they d o not store terrorist content. Three types of measures are 
set out in the latter regard. Firstly, member States should ensure that their competent authorities 
have the capability to detect and identify terrorist content and to request the removal or the di sabling 
of access to such content. If a hosting service provider receives such a request, it must assess and, 
where appropriate, remove or disable access to the content, as a general rule, within one hour from 
the moment it receives the request. Secondly, hosting service providers should take proactive 
measures, including by using automated means, to identify and remove or disable access to terrorist 
content. Thirdly, hosting service providers should be encouraged to cooperate, through the sharing 
of techno logical tools, to prevent the dissemination of terrorist content across different hosting 
services.  
4.334.   In November 2018, the EU adopted a revision of the Audiovisual Media Services Directive 
which, for the first time, imposed certain obligations on online pl atforms whose principal purpose, 
or the principal purpose of a dissociable section thereof, or essential functionality is the provision of 
audiovisual content to the general public. The aim of these new rules is to reinforce the protection 
of users and esp ecially minors against certain types of illegal and harmful audiovisual content online. 
(Section  4.4.6).  
4.335.   In June 2019, the EU adopted a Regulation laying down rules to improve the fairness and 
transparency of online platforms, which shall apply from 12 Ju ly 2020.455 The Regulation addresses 
potential frictions that arise from the growing dependence of business users upon providers of 
intermediation services "by laying down rules to ensure that business users of online intermediation 
services and corporate we bsite users in relation to online search engines are granted appropriate 
transparency, fairness and effective redress possibilities ".456  
4.336.   The main provisions of this Regulation can be summarized as follows.  
4.337.   Firstly, "online intermediation services" within t he meaning of this Regulation are defined as 
information society services that allow business users to offer goods or services to consumers with 
a view to facilitating the initiating of direct transactions between the business users and consumers, 
and whic h are provided to business users on the basis of contractual relationships between the 
business users and the providers of those services. The Regulation applies to providers of online 
intermediation and search engine services, irrespective of whether they  are established in a member 
State or outside the EU, if the business users or corporate website users are established in the EU 
                                                
electronic commerce). Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32000L00 31&from=EN . 
454 In this respect, the Recommendation is based on progress made in the context of the EU Internet 
Forum.  
455 Regulation (EU) 2019/1150 of the European Parliament and of the Council of 20 June 2019 on 
promoting fairness and transparency for busine ss users of online intermediation services. Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX:32019R1150&from=EN . 
456 Regulation (EU) 2019 /1150, Art. 1.  WT/TPR/S/395 • European Union  
 
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  and offer their goods and services to consumers located within the EU at least for part of the 
transaction.457 
4.338.   Secondly, the Regulation requires providers of online intermediation services to ensure 
transparency of their terms and conditions, including by drafting the terms and conditions in clear 
and intelligible language and making them easily available to busine ss users, and to notify business 
users concerned of any proposed changes of their terms and conditions and, subject to certain 
exceptions, allow a period of at least 15 days within which the business user may terminate the 
contract.  
4.339.   Thirdly, if a provider  of online intermediation services decides to restrict or suspend the 
provision of its online intermediation services to a given business user, it is required to provide a 
statement of reasons before the restriction or suspension takes effect. Where a prov ider of online 
intermediation services decides to terminate the whole of its online intermediation services to a 
business user, it is required to provide a statement of reasons to that business user at least 30 days 
before the termination takes effect.458  
4.340.   Fourthly, the Regulation sets out a series of specific requirements regarding the information 
to be provided by online intermediation service providers on their terms and conditions: (i) online 
intermediation service providers and providers of search engine  services are required to set out the 
main parameters they use to determine ranking ( "the relative prominence given to the goods or 
services offered through online intermediation services, or the relevance given to search results by 
online search engines "); (ii) providers of online intermediation services are required to include in 
their terms and conditions a description of any differentiated treatment they give in relation to goods 
or services offered to consumers through those intermediation services eit her by that provider itself 
or any business users which it controls and by any other business users; and (iii) providers of online 
intermediation services are required to include in their terms and conditions a description of the 
access that the provider o f the intermediation services or the business user have to data provided 
for the use of the intermediation service or generated by the use of the service, and to indicate 
whether any such data is provided to third parties.459  
4.341.   Fifthly, the Regulation require s that providers of online intermediation services establish an 
internal complaint -handling system to address complaints of business users and to identify in their 
terms and conditions two or more mediators with which they are willing to engage to attempt to 
resolve, out of court, any dispute between the provider of that service and a business user. It lays 
down certain conditions that such mediators must fulfil, and provides that the Commission shall 
encourage the creation of organizations providing such m ediation services. Finally, the Regulation 
defines the conditions under which organizations and associations representing business users or 
corporate website users, as well as public bodies set up in member States, have the right to initiate 
proceedings be fore the competent national courts of the member States to stop or prohibit 
non-compliance with the terms of the Regulation by providers of online intermediation services or 
search engine services.460  
4.4.5.1.1   EU Cybersecurity Act  
4.342.   The EU Cybersecurity Act entered i nto force on 27 June 2019.461 It reinforces the role of the 
EU Agency for Cybersecurity ( ENISA ) by expanding its mandate and providing it with more 
resources. The revised mandate of ENISA is to: contribute to the development and implementation 
of EU policy a nd law in the field of cybersecurity; support capacity building and preparedness across 
the EU; promote operational cooperation at the EU level; support and promote the development and 
implementation of EU policy on cybersecurity certification; provide ana lysis and advice , and raise 
awareness and identify research needs in the field of cybersecurity; and contribute to the 
EU's international cooperation in this field. The Act also establishes a European cybersecurity 
                                                
457 Regulation (EU) 2019/1150, Arts. 2(2) and 1(2). The term "consumer" for the purposes of this 
Regulation only covers natural persons. Regulation (EU) 2019/1150, Art.  2(4). 
458 Regulation (EU) 2019/1150, Arts.3 -4. 
459 Regulation (EU) 2019/1150, Arts.5, 7, 9.  
460 Regulation (EU) 2019/1150, Arts. 11 -14. 
461 Regulation (EU) 2019/881 of the European Parliament and of the Council of 17 April 2019 on ENISA 
(the European Union Agency for Cybersecurity) and on information and communications technology 
cybers ecurity certification and repealing Regulation (EU) No. 526/2013 (Cybersecurity Act). Viewed at: 
https://eur -lex.europa.eu/legal -content/EN/TXT/PDF/?uri=CELEX: 32019R0881&from=EN . WT/TPR/S/395 • European Union  
 
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  certification framework in order to incre ase the level of cybersecurity and enable a harmonized 
approach to cybersecurity certification within the EU , with a view to creating a single digital market 
for ICT products, services and processes.  
4.4.6   Audiovisual services  
4.343.   As part of the DSM Strategy, the Commission presented a proposal for the comprehensive 
reform of the existing Audiovisual Media Services Directive (AVMSD) in May 2016. The revised 
AVMSD was adopted in November 2018  and entered into force in December 2018 .462 It requires 
member States to transpose its provisions into national legislation by 19 September 2020.  
4.344.   A key consideration motivating the revision of the AVMSD was the significant evolution of 
the audiovisual services market since the last codification of th e AVMSD in 2010 , as a result of the 
convergence of television and Internet services. Specifically, as summarized in the previous Review , 
the factors which , in the view of the European Commission , required an adaptation of the 
EU regulatory regime for audio visual services were: the multiplication of the type of broadcasters 
(traditional TV broadcasters, video -on-demand providers , and video -sharing platforms); the 
decreasing average TV viewing time , especially among young people; the increasing share of 
Internet video in Internet traffic; the low share of revenues invested by on -demand service providers 
in original programming as compared to traditional TV broadcasters; the fragmented rules across 
the EU faced by the industry regarding the compulsory share of European content; the fact that 31% 
of video -on-demand services available in one EU member State were established in another member 
State; and the need for more independence of the regulators from government and industry.463  
4.345.   The main changes effected by the  amendments to the AVMSD can be summarized as follows.  
4.346.   Firstly, in order to reinforce the country of origin principle464, the revised AVMSD simplifies 
the rules to determine which country has jurisdiction over a media service provider, requires member 
State s to provide information on which media service providers are under their jurisdiction and to 
maintain an up -to-date database to ensure transparency, and clarifies procedures for cooperation 
between the member States regarding permissible limitations to th e country of origin principle.465  
4.347.   Secondly, the revised AVMSD reinforces the existing rules on hate speech, and introduces a 
ban on provocations to commit terrorist acts. It requires member States to ensure that audiovisual 
media services provided by media service providers under their jurisdiction do not contain any 
(i) incitement to violence or hatred directed against a group or a member of a group on grounds 
such as sex, race, colour, ethnic or social origin, or any other grounds of discrimination prohibi ted 
by the EU  Charter of Fundamental Rights; or (ii) provocation to commit a terrorist offence. Thirdly, 
the revised AVMSD contains additional protections of children. It requires member States to ensure 
that audiovisual media services that may impair the physical, mental or moral development of minors 
are only made available in such a way as to ensure that minors will not normally hear or see them. 
It obligates member States to encourage the use of self -regulation and co -regulation through codes 
of conduct  regarding inappropriate audiovisual communications in children's programmes for foods 
that are high in fat, salt and sugar. It prohibits product placement in children's programmes and the 
transmission of teleshopping during such programmes.466  
4.348.   Fourthly, th e revised AVMSD extends certain rules for audiovisual media services to 
video -sharing platforms, including audiovisual content shared on certain social media services. (i) 
The AVMSD lays down rules to determine when a video -sharing platform provider shall be considered 
to be within the jurisdiction of a member State; requires member States to establish and maintain 
                                                
462 Directive (EU) 2018/1808 of the European Parliament and of the Council of 14 November 2018 
amending Directive 2010/13/EU on the coordination of certain provisions laid down by law, regulation or 
administrative action in Member States concerning the provision of audiovisual media services (Audiovisual 
Media Services Directive) in view of changing market realities. Viewed at: https://eur -lex.europa.eu/legal -
content/EN/TXT/PDF/?uri=CELEX:32018L1808&from=EN . 
463 WTO document WT/TPR/S/357/Rev.1, 13 October 2017, para. 4.101.  
464 The country of origin principle as expressed in Article 2 of the AVMSD states that "each member 
State shall ensure that all audiovisual media services transmitted by media service providers under its 
jurisdiction comply with the rules of the system of law  applicable to audiovisual media services intended for the 
public in that Member State".  
465 Directive 2018/1808, Art. 1(3) . 
466 Directive 2010/13/EU, as amended, Arts. 6a, 9, 11, and 20 . WT/TPR/S/395 • European Union  
 
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  up-to-date lists of video -sharing platform providers within their jurisdiction; and provides that the 
European Commission may request an opinion  from the European Regulators Group for Audiovisual 
Media Services (ERGA) when member States disagree on which member State has jurisdiction over 
a video -sharing platform provider.467 (ii) Without prejudice to the provisions of the e -Commerce 
Directive on li ability of intermediary service providers, the revised AVMSD requires member States 
to ensure that video -sharing platform providers under their jurisdiction take appropriate measures468 
to protect minors from programmes, user -generated videos and audiovisual  communications that 
may impair their physical, mental and or moral development, and to protect the general public from 
programmes, user -generated videos and audiovisual commercial communications that contain 
incitements to violence or hatred against a gro up of persons or members of a group on the grounds 
referred to in Article 21 of the Charter of Fundamental Rights, or that contain content the 
dissemination of which is a criminal offence under EU law (namely public provocation to commit 
terrorist offences , child pornography, and racism or xenophobia).469 (iii) The AVMSD imposes on 
video -sharing platforms certain obligations regarding the audiovisual commercial communications 
provided in their platforms, depending on the degree of control exercised over such audiovisual 
commercial communications.470 
4.349.   Fifthly, the revised AVMSD establishes rules on the promotion of European content  in respect 
of on -demand audiovisual service providers.471 Member States are required to ensure that media 
service providers of on -demand  audiovisual media services under their jurisdiction secure at least a 
30% European share in their catalogues, and ensure prominence of those works. If a member State 
requires media service providers under its jurisdiction to contribute financially to the production of 
European works, it may also impose such an obligation upon media service providers established in 
another member State which targets audiences in its territory.472  
4.350.   Sixthly, the revised AVMSD introduces more flexibility regarding restrictions o n television 
advertising. For example, the current limitation of advertising of 12 minutes per hour is replaced 
with an overall limit of 20% of broadcasting time between 6am and 6pm and between 6pm and 
midnight.473  
4.351.   Finally, the revised AVMSD requires member  States to establish national regulatory 
authorities or bodies, which must be legally distinct from the Government, and to ensure that such 
authorities or bodies exercise their powers impartially, transparently, and in accordance with the 
objectives of the  AVSMD. The national regulatory authorities or bodies must provide to each other 
and the Commission information necessary for the application of the AVMSD. At the EU level, the 
revised AVMSD established the ERGA, a new body composed of representatives of t he national 
regulatory bodies or authorities with primary responsibility for overseeing audiovisual media 
services. ERGA's tasks are to provide technical expertise to the European Commission, to exchange 
experience and best practice on the application of t he regulatory framework for audiovisual media 
services, to cooperate and provide its members with the information necessary for the application 
of the AVMSD, and to give opinions at the request of the Commission on certain matters under the 
AVMSD.474 
                                                
467 Directive 2010/13/EU, as amended, Art. 28(a) . 
468 The revised AVMSD pro vides guidance on what constitute "appropriate measures" in this context. It 
identifies several factors to be taken into account when determining what are appropriate measures, and lists 
specific examples of such measures. It also provides that appropriate  measures may not include any ex ante  
control measures or upload filtering of content. Directive 2010/13/EU, as amended, Art. 28(b)(3).  
469 Directive 2010/13/EU, as amended, Art. 28(b) . 
470 Directive 2010/13/EU , as amended, Art. 28(b) para. 2 and para. 3(b) an d (c). 
471 The revised AVSMD does not change the existing provisions on European content as they apply to 
television broadcasting.  
472 Directive 2010/13/EU, as amended, Art. 13 . 
473 Directive 2010/13/EU, as amended, Art. 23 . 
474 Directive 2010/13/EU, as amended, Art. 30 .  
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- 254 - 5  APPENDIX TABLES  
Table A1. 1 Selected economic indicators, 2015 -18 
  Inflation rate  
(HICP - annual average rate 
of change), %  Unemployment rate (% of 
labour force)  General government gross 
debt  
(% of GDP)  General government 
deficit/surplus  
(% of GDP)  Current account balance (% 
of GDP)a 
2015  2016  2017  2018  2015  2016  2017  2018  2015  2016  2017  2018  2015  2016  2017  2018  2015  2016  2017  2018  
EU-28 0.1 0.2 1.7 1.9 9.4 8.6 7.6 6.8 84.9 83.8 82.1 80.4 -2.4 -1.7 -1.0 -0.7 0.9 1.4 1.3 1.3 
Austria  0.8 1.0 2.2 2.1 5.7 6.0 5.5 4.9 84.9 82.9 78.3 74.0 -1.0 -1.5 -0.7 0.2 1.7 2.7 1.6 2.3 
Belgium  0.6 1.8 2.2 2.3 8.5 7.8 7.1 6.0 105.2  104.9  101.8  100.0  -2.4 -2.4 -0.7 -0.7 1.4 0.6 1.2 -1.0 
Bulgaria  -1.1 -1.3 1.2 2.6 9.2 7.6 6.2 5.2 26.0 29.3 25.3 22.3 -1.7 0.1 1.1 1.8 0.1 3.2 3.5 5.4 
Croatia  -0.3 -0.6 1.3 1.6 16.1 13.4 11.0 8.4 84.4 81.0 78.0 74.8 -3.3 -1.1 0.8 0.3 3.2 2.0 3.3 1.9 
Cyprus  -1.5 -1.2 0.7 0.8 15.0 13.0 11.1 8.4 107.5  103.4  93.9 100.6  -1.0 0.1 1.7 -4.4 -0.6 -4.3 -5.2 -4.5 
Czech Republic  0.3 0.6 2.4 2.0 5.1 4.0 2.9 2.2 40.0 36.8 34.7 32.6 -0.6 0.7 1.6 1.1 0.2 1.6 1.7 0.3 
Denmark  0.2 0.0 1.1 0.7 6.3 6.0 5.8 5.1 39.8 37.2 35.5 34.2 -1.2 0.2 1.7 0.8 8.2 7.8 7.7 7.1 
Estonia  0.1 0.8 3.7 3.4 6.2 6.8 5.8 5.4 10.0 10.2 9.3 8.4 0.1 -0.5 -0.8 -0.6 1.8 1.7 2.7 2.0 
Finland  -0.2 0.4 0.8 1.2 9.4 8.8 8.6 7.4 63.0 62.6 60.9 59.0 -2.4 -1.7 -0.7 -0.8 -0.9 -2.0 -0.8 -1.4 
France  0.1 0.3 1.2 2.1 10.4 10.1 9.4 9.1 95.6 98.0 98.4 98.4 -3.6 -3.5 -2.8 -2.5 -0.4 -0.5 -0.7 -0.6 
Germany  0.7 0.4 1.7 1.9 4.6 4.1 3.8 3.4 72.1 69.2 65.3 61.9 0.9 1.2 1.2 1.9 8.5 8.4 8.0 7.2 
Greece  -1.1 0.0 1.1 0.8 24.9 23.6 21.5 19.3 175.9  178.5  176.2  181.2  -5.6 0.5 0.7 1.0 -0.8 -1.7 -1.9 -2.8 
Hungary  0.1 0.4 2.4 2.9 6.8 5.1 4.2 3.7 76.1 75.5 72.9 70.2 -2.0 -1.8 -2.4 -2.3 2.4 4.6 2.3 -0.5 
Ireland  0.0 -0.2 0.3 0.7 10.0 8.4 6.7 5.8 76.7 73.9 67.8 63.6 -1.9 -0.7 -0.3 0.1 4.4 -4.2 0.5 10.8 
Italy 0.1 -0.1 1.3 1.2 11.9 11.7 11.2 10.6 135.3  134.8  134.1  134.8  -2.6 -2.4 -2.4 -2.2 1.4 2.6 2.7 2.6 
Latvia  0.2 0.1 2.9 2.6 9.9 9.6 8.7 7.4 36.7 40.2 38.6 36.4 -1.4 0.1 -0.5 -0.7 -0.9 1.4 1.0 -0.7 
Lithuania  -0.7 0.7 3.7 2.5 9.1 7.9 7.1 6.2 42.7 39.9 39.3 34.1 -0.3 0.2 0.5 0.6 -2.4 -1.1 0.5 0.3 
Luxembourg  0.1 0.0 2.1 2.0 6.5 6.3 5.6 5.5 22.0 20.1 22.3 21.0 1.4 1.8 1.4 2.7 5.1 5.1 5.0 4.9 
Malta  1.2 0.9 1.3 1.7 5.4 4.7 4.0 3.7 57.8 55.5 50.3 45.8 -1.0 0.9 3.4 1.9 2.8 3.8 11.4 11.4 
Netherlands  0.2 0.1 1.3 1.6 6.9 6.0 4.9 3.8 64.6 61.9 56.9 52.4 -2.0 0.0 1.3 1.5 6.3 8.1 10.8 10.9 
Poland  -0.7 -0.2 1.6 1.2 7.5 6.2 4.9 3.9 51.3 54.2 50.6 48.9 -2.6 -2.4 -1.5 -0.2 -0.6 -0.5 0.1 -1.0 
Portugal  0.5 0.6 1.6 1.2 12.6 11.2 9.0 7.0 131.2  131.5  126.0  122.2  -4.4 -1.9 -3.0 -0.4 0.1 1.1 1.2 0.4 
Romania  -0.4 -1.1 1.1 4.1 6.8 5.9 4.9 4.2 37.8 37.3 35.1 35.0 -0.6 -2.6 -2.6 -3.0 -1.2 -2.1 -3.2 -4.6 
Slovak Republic  -0.3 -0.5 1.4 2.5 11.5 9.7 8.1 6.5 51.9 52.0 51.3 49.4 -2.7 -2.5 -1.0 -1.1 -2.1 -2.7 -1.9 -2.6 
Slovenia  -0.8 -0.2 1.6 1.9 9.0 8.0 6.6 5.1 82.6 78.7 74.1 70.4 -2.8 -1.9 0.0 0.8 3.8 4.8 6.1 5.6  
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- 255 -   Inflation rate  
(HICP - annual average rate 
of change), %  Unemployment rate (% of 
labour force)  General government gross 
debt  
(% of GDP)  General government 
deficit/surplus  
(% of GDP)  Current account balance (% 
of GDP)a 
2015  2016  2017  2018  2015  2016  2017  2018  2015  2016  2017  2018  2015  2016  2017  2018  2015  2016  2017  2018  
Spain  -0.6 -0.3 2.0 1.7 22.1 19.6 17.2 15.3 99.3 99.2 98.6 97.6 -5.2 -4.3 -3.0 -2.5 2.0 3.2 2.7 1.9 
Sweden  0.7 1.1 1.9 2.0 7.4 6.9 6.7 6.3 43.9 42.3 40.7 38.8 0.0 1.0 1.4 0.8 4.2 3.8 2.8 1.7 
United Kingdom  0.0 0.7 2.7 2.5 5.3 4.8 4.3 4.0 86.9 86.8 86.2 85.9 -4.6 -3.4 -2.4 -2.3 -5.0 -5.3 -3.5 -4.4 
a EU-28 with the extra -EU countries. Each member State with all other countries (including other EU countries).  
Source:  Eurostat, Harmonized indices of consumer prices (prc_hicp_aind) . Viewed at: https://ec.europa.eu/eurostat/web/hicp/data/database ; Employment and 
unemployment (une_rt_a) . Viewed at: https://ec.europa.eu/eurostat/web/lfs/data/database ; General government deficit/surplus (tec00127). Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=tec00127&lang=en ; General government gross debt (sdg_17_40) . Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui/sh ow.do?dataset=sdg_17_40&lang=en ; and Balance of Payments (bop_gdp6_q) . Viewed at: 
https://ec.europa.eu/eurostat/web/balance -of-payments/data/database .  
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  Table A1. 2 Extra -EU merchandise exports by product group, 2015 -18 
  2015  2016  2017  2018  
Total (EUR billion)  1,790.4  1,745.4  1,878.4  1,956.4  
  (% of total)  
Primary products  14.8 14.6 15.7 16.1 
 Agriculture  7.9 8.3 8.2 7.8 
 Food 6.6 7.0 6.8 6.5 
 Agricultural raw materials  1.3 1.3 1.3 1.3 
 Mining  6.9 6.3 7.6 8.3 
 Fuels 4.8 4.3 5.3 5.9 
 Non-ferrous metals  1.3 1.2 1.3 1.4 
 Ores and other minerals  0.8 0.8 0.9 1.0 
 Manufactures  80.7 81.9 81.0 80.4 
 Iron and steel  1.9 1.7 1.7 1.8 
 Chemicals  17.6 17.9 17.7 18.2 
 Organic chemicals  2.7 2.7 2.4 2.5 
 Pharmaceuticals  8.0 8.2 8.3 8.6 
 Plastics  2.2 2.2 2.2 2.2 
 Essential oils and resinoids and perfume materials  1.6 1.7 1.7 1.7 
 Fertilizers  0.2 0.2 0.2 0.2 
 Other chemicals  2.9 2.9 3.0 2.9 
 Other semi -manufactures  6.9 7.0 6.8 6.6 
 Machinery and transport equipment  42.1 42.7 42.3 41.4 
 Office machines and telecommunications equipment  4.3 4.5 4.4 4.2 
 Electronic data processing and office equipment  1.3 1.3 1.2 1.2 
 Integrated circuits and electronic components  1.0 1.3 1.3 1.2 
 Telecommunication equipment  2.0 1.9 1.9 1.8 
 Transport equipment  18.0 18.3 17.7 17.0 
 Automotive products  11.5 11.6 11.5 10.9 
 Other transport equipment  6.4 6.7 6.2 6.1 
 Other machinery  19.8 19.9 20.2 20.1 
 Power generating machines  3.1 3.3 3.3 3.3 
 Other non -electrical machinery  12.1 11.9 12.1 12.1 
 Other electrical machines  4.6 4.8 4.8 4.8 
 Textiles  1.0 1.0 1.0 1.0 
 Clothing  1.4 1.4 1.5 1.5 
 Other consumer goods  9.8 10.2 10.1 10.0 
Other  4.5 3.6 3.2 3.5 
Source:  Eurostat, International trade in goods . Viewed at: https://ec.europa.eu/eurostat/web/international -
trade -in-goods/data/database . 
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  Table A1. 3 Extra -EU merchandise exports by destination, 2015 -18  
  2015  2016  2017  2018  
Total (EUR billion)   1,790.4   1,745.4   1,878.4   1,956.4   
(% of total)  
Americas  29.5 29.4 28.5 29.4 
 United States  20.7 20.8 20.0 20.8 
 Other America  8.7 8.5 8.5 8.6 
 Canada  2.0 2.0 2.0 2.1 
 Mexico  1.9 1.9 2.0 2.0 
 Brazil  1.9 1.8 1.7 1.7 
Europe  17.5 17.5 17.5 17.2 
 EFTA 11.3 11.2 10.9 11.0 
 Switzerland  8.5 8.2 8.1 8.1 
 Norway  2.7 2.8 2.7 2.8 
 Other Europe  6.2 6.3 6.6 6.2 
 Turkey  4.4 4.5 4.5 3.9 
Commonwealth of independent states (CIS)  6.2 6.2 6.8 6.7 
 Russian Federation  4.1 4.1 4.6 4.4 
 Ukraine  0.8 0.9 1.1 1.1 
Africa  8.7 8.3 8.0 7.8 
 South Africa  1.4 1.3 1.3 1.2 
 Morocco  1.0 1.2 1.2 1.2 
Middle East  8.6 8.3 7.9 7.0 
 United Arab Emirates  2.7 2.6 2.3 1.9 
 Saudi Arabia, Kingdom of  2.2 1.9 1.8 1.6 
 Israel  1.1 1.2 1.1 1.1 
Asia 27.9 28.7 29.6 29.8 
 China  9.5 9.7 10.5 10.7 
 Japan  3.2 3.3 3.2 3.3 
 Other Asia  15.3 15.7 15.8 15.8 
 Korea, Republic of  2.7 2.5 2.7 2.5 
 India 2.1 2.2 2.2 2.3 
 Singapore  1.7 1.8 1.8 1.9 
 Hong Kong, China  2.0 2.0 2.0 1.9 
 Australia  1.8 1.9 1.8 1.8 
 Chinese Taipei  1.0 1.1 1.1 1.1 
Other  1.7 1.5 1.8 2.1 
Source:  Eurostat, International trade in goods . Viewed at: https://ec.europa.eu/eurostat/web/international -
trade -in-goods/data/database . 
 
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  Table A1. 4 Extra -EU merchandise imports by product group, 2015 -18 
  2015  2016  2017  2018  
Total (EUR billion)  1,725.2  1,706.5  1,855.3  1,979.2  
  (% of total)  
Primary products  31.6 27.9 30.5 32.9 
 Agriculture  8.7 8.8 8.5 8.0 
 Food 7.3 7.4 7.1 6.6 
 Agricultural raw materials  1.4 1.4 1.4 1.4 
 Mining  22.9 19.1 22.0 24.9 
 Fuels 19.0 15.5 18.0 20.8 
 Non-ferrous metals  2.1 2.0 2.2 2.3 
 Ores and other minerals  1.8 1.6 1.8 1.8 
Manufactures  65.7 67.3 66.0 64.3 
 Iron and steel  1.7 1.6 1.9 2.0 
 Chemicals  10.8 10.8 10.6 10.3 
 Organic chemicals  2.6 2.5 2.4 2.4 
 Pharmaceuticals  4.2 4.4 4.2 3.9 
 Plastics  1.3 1.4 1.4 1.4 
 Essential oils and resinoids and perfume materials  0.5 0.6 0.5 0.5 
 Fertilizers  0.3 0.2 0.2 0.2 
 Other chemicals  1.8 1.8 1.8 1.8 
 Other semi -manufactures  5.4 5.5 5.3 5.2 
 Machinery and transport equipment  30.9 32.2 32.0 31.3 
 Office machines and telecommunications equipment  11.7 11.4 11.5 11.2 
 Electronic data processing and office equipment  4.4 4.1 4.0 3.8 
 Integrated circuits and electronic components  1.5 1.5 1.8 1.9 
 Telecommunication equipment  5.8 5.8 5.7 5.5 
 Transport equipment  7.5 8.5 8.3 7.7 
 Automotive products  3.8 4.3 4.5 4.4 
 Other transport equipment  3.7 4.2 3.9 3.3 
 Other machinery  11.7 12.2 12.2 12.4 
 Power generating machines  2.4 2.6 2.6 2.7 
 Other non -electrical machinery  4.7 4.8 4.7 4.8 
 Other electrical machines  4.7 4.9 4.8 4.9 
 Textiles  1.5 1.6 1.5 1.4 
 Clothing  5.0 5.1 4.7 4.5 
 Other consumer goods  10.5 10.6 10.1 9.6 
Other  2.7 4.9 3.5 2.8 
Source:  Eurostat, International trade in goods . Viewed at: https://ec.europa.eu/eurostat/web/international -
trade -in-goods/data/database . 
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  Table A1. 5 Extra -EU merchandise imports by origin, 2015 -18 
  2015  2016  2017  2018  
Total (EUR billion)   1,725.2   1,706.5   1,855.3   1,979.2   
(% of total)  
Americas  21.8 21.9 21.1 20.5 
 United States  14.5 14.6 13.9 13.6 
 Other America  7.3 7.3 7.3 6.9 
 Brazil  1.8 1.7 1.7 1.6 
 Canada  1.6 1.7 1.7 1.6 
 Mexico  1.1 1.2 1.3 1.3 
Europe  15.0 16.1 15.1 15.0 
 EFTA 10.5 11.1 10.2 10.0 
 Switzerland  6.0 7.2 6.0 5.6 
 Norway  4.3 3.7 4.0 4.2 
 Other Europe  4.6 5.0 4.9 5.0 
 Turkey  3.6 3.9 3.8 3.8 
Commonwealth of independent states (CIS)  10.6 9.3 10.5 11.5 
 Russian Federation  7.9 7.0 7.8 8.5 
 Kazakhstan  0.9 0.7 0.9 1.1 
 Ukraine  0.7 0.8 0.9 0.9 
Africa  7.7 6.8 7.1 7.7 
 South Africa  1.1 1.3 1.2 1.2 
 Nigeria  1.1 0.6 0.8 1.2 
 Algeria  1.2 1.0 1.0 1.1 
Middle East  4.1 4.0 4.5 4.8 
 Saudi Arabia, Kingdom of  1.2 1.1 1.2 1.5 
Asia 40.0 41.2 40.9 39.7 
 China  20.3 20.6 20.2 19.9 
 Japan  3.5 3.9 3.7 3.5 
 Other Asia  16.1 16.7 16.9 16.2 
 Korea, Republic of  2.4 2.4 2.7 2.5 
 India 2.3 2.3 2.4 2.3 
 Viet Nam  1.7 1.9 2.0 1.9 
 Chinese Taipei  1.5 1.6 1.6 1.5 
 Malaysia  1.3 1.3 1.3 1.3 
 Thailand  1.1 1.2 1.2 1.2 
 Singapore  1.1 1.1 1.1 1.1 
Other  0.8 0.8 0.8 0.9 
Source:  Eurostat, International trade in goods . Viewed at: https://ec.europa.eu/eurostat/web/international -
trade -in-goods/data/database . 
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  Table A1. 6 Intra - and extra -EU merchandise trade by membe r State, 2015 -18 
 
Intra -and extra -EU trade (%)   
2015  2016  2017  2018   
Extra -
EU-28 Intra -
EU-28 Extra -
EU-28 Intra -
EU-28 Extra -
EU-28 Intra -
EU-28 Extra -
EU-28 Intra -
EU-28 
Export          
EU-28 36.8 63.2 35.9 64.1 35.9 64.1 35.7 64.3 
Austria  29.9 70.1 29.4 70.6 28.8 71.2 28.6 71.4 
Belgium  28.3 71.7 28.0 72.0 27.8 72.2 27.1 72.9 
Bulgaria  35.1 64.9 33.7 66.3 36.4 63.6 31.4 68.6 
Croatia  34.1 65.9 34.5 65.5 36.0 64.0 32.2 67.8 
Cyprus  55.8 44.2 51.4 48.6 61.7 38.3 71.4 28.6 
Czech Republic  16.7 83.3 16.4 83.6 16.1 83.9 15.6 84.4 
Denmark  38.7 61.3 38.3 61.7 38.2 61.8 38.9 61.1 
Estonia  24.8 75.2 26.1 73.9 28.2 71.8 32.0 68.0 
Finland  41.1 58.9 41.4 58.6 40.5 59.5 41.0 59.0 
France  41.1 58.9 40.6 59.4 41.2 58.8 41.0 59.0 
Germany  42.1 57.9 41.5 58.5 41.5 58.5 41.0 59.0 
Greece  45.5 54.5 43.7 56.3 46.3 53.7 47.2 52.8 
Hungary  18.7 81.3 18.6 81.4 18.8 81.2 18.2 81.8 
Ireland  47.0 53.0 49.8 50.2 48.9 51.1 49.8 50.2 
Italy 45.2 54.8 44.1 55.9 44.3 55.7 43.7 56.3 
Latvia  30.4 69.6 30.0 70.0 33.2 66.8 33.3 66.7 
Lithuania  38.7 61.3 39.3 60.7 41.7 58.3 41.2 58.8 
Luxembourg  16.0 84.0 17.2 82.8 15.7 84.3 15.8 84.2 
Malta  54.2 45.8 57.7 42.3 43.5 56.5 42.3 57.7 
Netherlands  24.2 75.8 23.9 76.1 24.7 75.3 25.6 74.4 
Poland  20.7 79.3 20.3 79.7 20.0 80.0 19.7 80.3 
Portugal  27.3 72.7 24.9 75.1 25.9 74.1 23.9 76.1 
Romania  26.3 73.7 24.9 75.1 24.2 75.8 22.9 77.1 
Slovak Republic  14.5 85.5 14.5 85.5 14.3 85.7 14.3 85.7 
Slovenia  24.0 76.0 24.7 75.3 24.3 75.7 23.7 76.3 
Spain  34.9 65.1 33.2 66.8 33.7 66.3 33.8 66.2 
Sweden  41.5 58.5 40.9 59.1 40.9 59.1 40.5 59.5 
United Kingdom  55.6 44.4 52.6 47.4 52.3 47.7 52.9 47.1 
Import          
EU-28 36.5 63.5 35.9 64.1 36.1 63.9 36.5 63.5 
Austria  23.2 76.8 22.0 78.0 22.7 77.3 22.4 77.6 
Belgium  37.2 62.8 36.2 63.8 35.5 64.5 35.7 64.3 
Bulgaria  35.7 64.3 33.6 66.4 36.0 64.0 36.4 63.6 
Croatia  22.3 77.7 23.1 76.9 22.3 77.7 22.3 77.7 
Cyprus  36.5 63.5 33.8 66.2 39.3 60.7 42.6 57.4 
Czech Republic  22.7 77.3 21.2 78.8 22.0 78.0 23.5 76.5 
Denmark  30.5 69.5 28.7 71.3 30.2 69.8 30.0 70.0 
Estonia  18.4 81.6 18.2 81.8 19.0 81.0 23.4 76.6 
Finland  27.0 73.0 27.0 73.0 28.3 71.7 29.8 70.2 
France  30.9 69.1 30.1 69.9 30.4 69.6 30.9 69.1 
Germany  34.4 65.6 33.7 66.3 33.7 66.3 33.6 66.4 
Greece  45.3 54.7 42.9 57.1 45.5 54.5 47.5 52.5 
Hungary  23.4 76.6 22.3 77.7 23.9 76.1 25.2 74.8 
Ireland  33.9 66.1 34.5 65.5 34.4 65.6 36.1 63.9 
Italy 41.3 58.7 39.2 60.8 39.8 60.2 41.0 59.0 
Latvia  20.7 79.3 19.6 80.4 21.4 78.6 25.2 74.8 
Lithuania  32.3 67.7 28.9 71.1 29.4 70.6 31.1 68.9 
Luxembourg  27.8 72.2 22.6 77.4 16.8 83.2 12.3 87.7 
Malta  33.2 66.8 44.5 55.5 37.8 62.2 27.8 72.2 
Netherlands  54.2 45.8 53.1 46.9 54.0 46.0 54.2 45.8 
Poland  29.3 70.7 27.6 72.4 28.3 71.7 30.7 69.3 
Portugal  23.5 76.5 22.2 77.8 23.7 76.3 24.2 75.8 
Romania  22.8 77.2 22.9 77.1 24.2 75.8 25.3 74.7 
Slovak Republic  21.3 78.7 19.8 80.2 20.2 79.8 19.8 80.2 
Slovenia  30.0 70.0 29.1 70.9 30.6 69.4 32.8 67.2 
Spain  39.3 60.7 38.1 61.9 40.3 59.7 41.6 58.4 
Sweden  30.0 70.0 28.9 71.1 28.5 71.5 29.8 70.2 
United Kingdom  46.4 53.6 49.5 50.5 48.1 51.9 47.2 52.8 
Source:  Eurostat, International trade in goods . Viewed at: https://ec.europa.eu/eurostat/web/international -
trade -in-goods/data/database . WT/TPR/S/395 • European Union  
 
- 261 - 
 
  Table A2. 1 European Union, Selected notifications to the WTO, 
March  2017 -September  2019  
WTO agreement  Description  Document symbol  Date  
Agreement on Agriculture  
Articles 10 and 18.2  Food Aid (Table ES:3)  
Export subsidies 
(Tables  ES:1 and ES:2)  G/AG/N/EU/53  
G/AG/N/EU/52  
G/AG/N/EU/51  
G/AG/N/EU/45  
G/AG/N/EU/44  
G/AG/N/EU/38  22/02/2019  
22/02/2019  
22/02/2019  
30/04/2018  
30/04/2018  
25/04/2017  
Article 16.2  Possible negative effects of 
the reform programme on 
least developed and net 
food-importing developing 
countries (Table NF:1)  G/AG/N/EU/54  
G/AG/N/EU/49  
G/AG/N/EU/42  09/04/2019  
07/01/2019  
28/02/2018  
Article 18.2  Domestic support 
commitments (Table  DS:1)  G/AG/N/EU/55  
G/AG/N/EU/46  
G/AG/N/EU/43  
 12/04/2019  
23/08/2018  
05/03/2018  
Article 18.2  Imports under tariff quotas  
(Table MA:2)  G/AG/N/EU/50  
G/AG/N/EU/48  
G/AG/N/EU/41  
G/AG/N/EU/40  
G/AG/N/EU/37  22/02/2019  
30/10/2018  
05/02/2019  
15/11/2017  
17/03/2017  
Articles 5.7 and 18.2  Use of special safeguard 
provisions (Table MA:5)  G/AG/N/EU/56  
G/AG/N/EU/47  
G/AG/N/EU/39  
G/AG/N/EU/36  24/09/2019  
30/10/2018  
04/10/2017  
20/03/2017  
General Agreement on Trade in Services  
Article III:4 and/ 
or IV:2 Contact and enquiry points  S/ENQ/78/Rev.19  
S/ENQ/78/Rev.18  
S/ENQ/78/Rev.17  29/08/2019  
01/02/2019  
07/06/2018  
Article V:7(a)  Economic integration 
agreements:  
EU-Armenia;  
EU-Japan;  
EU-Canada;  
EU-Colombia, Peru and 
Ecuador   
 
S/C/N/959  
S/C/N/921  
S/C/N/896  
S/C/N/876   
 
26/08/2019  
14/01/2019  
21/09/2017  
03/03/2017  
GATT 1994     
Article XVII:4(a)  State trading enterprises 
and products traded by 
them G/STR/N/17/EU  12/07/2018  
Article XXIV:7(a)  Free-trade areas:  
EU-Japan  
EU-Botswana, Lesotho, 
Mozambique, Namibia, 
South Africa and Swaziland  
 
EU-Canada  
EU-EU-Ghana  
EU-Colombia, Ecuador and 
Peru   
WT/REG396/N/1  
 
 
WT/REG381/N/1/Add.1  
WT/REG381/N/1  
WT/REG389/N/1  
WT/REG382/N/1  
WT/REG380/N/1  
  
14/01/2019  
 
 
12/02/2018  
04/04/2017  
21/09/2017  
04/04/2017  
03/03/2017  
Agreement on the Implementation of Article VI of the GATT 1994 (Anti -dumping Agreement)  
Article 16.4  Anti-dumping actions 
(preliminary and final)  G/ADP/N/327  
G/ADP/N/320  
G/ADP/N/306  
G/ADP/N/299  29/05/2019  
29/11/2018  
14/12/2017  
31/05/2017  
Article 16.4  Anti-dumping actions (taken 
within the preceding six 
months)  G/ADP/N/322/EU  
G/ADP/N/314/EU  
G/ADP/N/308/EU  
G/ADP/N/300/EU  
G/ADP/N/294/EU  04/04/2019  
23/10/2018  
29/03/2018  
19/10/2017  
11/04/2017  
Article 18.5  New or changes to laws or 
regulations relevant to the 
Agreement and the 
administration of such laws 
and regulations  G/ADP/N/1/EU/3/Suppl.3 
G/ADP/N/1/EU/3/Suppl.2 
G/ADP/N/1/EU/3/Suppl.1  02/07/2018  
23/01/2018  
18/04/2017  WT/TPR/S/395 • European Union  
 
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  WTO agreement  Description  Document symbol  Date  
Agreement on Government Procurement  
Appendix  Procurement thresholds  GPA/THR/EU/1  17/04/2018  
Article XIX:5  Statistics  GPA/123/Add.7  03/07/2017  
Agreement on Import Licensing  
Articles 1.4(a), 5, 7.3 
and/or 8.2(b)  Import licensing procedures  G/LIC/N/1/EU/12  
G/LIC/N/2/EU/12 G/LIC/N/1/EU/11 
G/LIC/N/2/EU/11  21/06/2018  
21/06/2018  
10/08/2017  
10/08/2017  
 Questionnaire  G/LIC/N/3/EU/8  
G/LIC/N/3/EU/7  
G/LIC/N/3/EU/6  
 25/09/2019  
03/10/2018  
03/10/2017  
Decision on Notification Procedures for Quantitative Restrictions  
G/L/59/Rev.1  Quantitative restrictions  G/MA/QR/N/EU/4  28/09/2018  
Agreement on Rules of Origin  
Paragraph 4 of 
Annex  II  
 Preferential rules of origin  
EU-Japan  
EU-Canada  
EU-Ghana  
EU-Botswana, Lesotho, 
Mozambique, Namibia, 
South Africa and Swaziland  
EU-Colombia, Ecuador and 
Peru  
G/RO/N/184  
G/RO/N/169  
G/RO/N/159  
 
 
G/RO/N/158  
G/RO/N/157  
  
15/04/2019  
24/05/2018  
21/07/2017  
 
 
21/07/2017  
21/07/2017  
WT/L/917/Add.1 
(Paragraph 4.3 of the 
2015 Ministerial 
Decision)  Preferential rules of origin 
for LDCs  G/RI/LDC/N/EU/1  30/06/2017  
Agreement on Subsidies and Countervailing Measures  
Article 25.1  Subsidies  G/SCM/N/343/EU/Add.25/Rev.1  
G/SCM/N/343/EU/Add.11, 16 and 27  
G/SCM/N/343/EU/Add. 24  
G/SCM/N/343/EU/Add.4 and 7  
G/SCM/N/343/EU and Add.17  
G/SCM/N/343/EU/Add.12, 22 and 28  
G/SCM/N/343/EU/Add.8 and 13  
G/SCM/N/343/EU/Add.3  
G/SCM/N/315/EU/Add.1 
G/SCM/N/315/EU/Add.23 
G/SCM/N/315/EU/Add.15  
G/SCM/N/315/EU/Add.22 
G/SCM/N/315/EU/Add.2, 
G/SCM/N/315/EU/Add.7,  
G/SCM/N/315/EU/Add.3 
G/SCM/N/315/EU/Add.11 and 18 
G/SCM/N/315/EU/Add.19 
G/SCM/N/315/EU/Add.21, 27 and 28  
G/SCM/N/315/EU/Ad d.14, 16, 20, 24, 
25 and 26,  
G/SCM/N/315/EU/Add.17 
G/SCM/N/315/EU/Add.13 
G/SCM/N/315/EU/Add.9 
G/SCM/N/315/EU/Add.8, 10 and 12,  
G/SCM/N/315/EU/Add.6, 
G/SCM/N/315/EU/Add.5  
G/SCM/N/315/EU and Add.4  
G/SCM/N/284/EU/Add.1  
G/SCM/N/284/EU/Add.25  19/09/2019  
18/09/2019  
17/09/2019  
16/09/2019  
13/09/2019  
10/09/2019  
13/08/2019  
09/08/2019  
11/04/2019  
20/03/2018  
28/02/2018  
23/02/2018  
04/10/2017  
04/09/2017  
01/09/2017  
30/08/2017  
28/07/2017  
25/07/2017  
24/07/2017  
 
21/07/2017  
20/07/2017  
19/07/2017  
17/07/2017  
14/07/2017  
12/072017  
11/07/2017  
05/05/2017  
31/03/2017  
Article 25.11  Countervailing duty actions 
(preliminary and final)  G/SCM/N/348  
G/SCM/N/332  
G/SCM/N/326  29/05/ 2019 
12/04/2018  
09/11/2017   
Countervailing duty actions 
(taken within the preceding 
six months)  G/SCM/N/342/EU  
G/SCM/N/334/EU  
G/SCM/N/328/EU  
G/SCM/N/321/EU  
G/SCM/N/313/EU  16/04/2019  
04/10/2018  
28/03/2018  
19/10/2017  
13/04/2017  
Article 32.6  Laws and regulations  G/SCM/N/1/EU/2/Suppl.3  
G/SCM/N/1/EU/2/Suppl.2  
G/SCM/N/1/EU/2/Suppl.1  02/07/2018  
23/01/2018  
24/04/2017  WT/TPR/S/395 • European Union  
 
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  WTO agreement  Description  Document symbol  Date  
Agreement on Trade Related Aspects of Intellectual Property Rights  
Article 63.2  Laws and regulations  IP/N/1/EU/23 -IP/N/1/EU/G/10  
IP/N/1/EU/22 -P/N/1/EU/G/9 ,  
IP/N/1/EU/21 -IP/N/1/EU/E/4  
IP/N/1/EU/20 -IP/N/1/EU/E/3  
IP/N/1/EU/19 -IP/N/1/EU/E/2  
IP/N/1/EU/18 -IP/N/1/EU/U/5  
IP/N/1/EU/17 -IP/N/1/EU/U/4  
IP/N/1/EU/16 -IP/N/1/EU/P/9  
IP/N/1/EU/15 -IP/N/1/EU/G/8  
IP/N/1/EU/14 -IP/N/1/EU/G/7  
IP/N/1/EU/13 -IP/N/1/EU/G/6  
IP/N/1/EU/12 -IP/N/1/EU/G/5  
IP/N/1/EU/11 -IP/N/1/EU/G/4  
IP/N/1/EU/10 -IP/N/1/EU/T/9  
IP/N/1/EU/9 -IP/N/1/EU/T/8  
IP/N/1/EU/8 -IP/N/1/EU/T/7  
IP/N/1/EU/7 -IP/N/1/EU/C/10   26/03/2019  
26/03/2019  
04/05/2017  
04/05/ 2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
04/05/2017  
Agreement on Safeguards  
Article 12.1  Initiation of investigations or 
reviews, injury 
determinations and 
decisions to apply, extend or 
adjust a safeguard measure  G/SG/N/10/EU/1/Suppl.3  
G/SG/N/10/EU/1/Suppl.2  
G/SG/N/10/EU/1/Suppl.1  
G/SG/N/10/EU/1  
G/SG/N/6/EU/1/Suppl.1  
G/SG/N/6/EU/1  15/08/2019  
21/05/2019  
07/02/2019  
04/01/2019  
29/06/2018  
27/03/2018  
Article 12.4  Provisional measures  G/SG/N/7/EU/1  18/07/2018  
Article 12.5  Suspension of concessions  G/SG/N/12/EU/1  18/05/2018  
Agreement on Sanitary and Phytosanitary Measures  
Article 7 and Annex B, 
paragraph 5  Proposed and adopted SPS 
regulations  228 notifications received. Viewed at 
http://spsims.wto.org   
Trade Facilitation Agreement  
Article 22  Notifications under Article 22  G/TFA/N/EU/2/Add.2  
G/TFA/N/EU/2/Add.1  
G/TFA/N/EU/2  14/06/2019  
28/09/2018  
20/07/2017  
Articles 1, 10 and 12  Notifications under Articles 
1, 10 and 12  G/TFA/N/EU/1/Rev.1  
G/TFA/N/EU/1/Add.1  
G/TFA/N/EU/1  21/03/2018  
05/03/2018  
20/07/2017  
Agreement on Technical Barriers to Trade  
Articles 2.9 and 5.6  Proposed and adopted 
technical regulations and 
conformity assessment 
procedures  240 notifications received. Viewed at: 
http://tbtims.wto.org    
Source:  WTO Secretariat.  WT/TPR/S/395 • European Union  
 
- 264 - 
 
  Table A2. 2 Involvement in WTO dispute settlement, March 2017 -September 2019  
Subject  Complainant/respondent  Date of 
request for 
consultations  Status as at 
30 September 2019  WTO 
document 
series  
EU as complainant      
Certain measures on 
steel and aluminium 
products  EU/United States  01/06/2018  Panel composed  WT/DS548  
Certain measures on 
the transfer of 
technology  EU/China  01/06/2018  In consultations  WT/DS549  
Anti-dumping and 
countervailing duties 
on ripe olives from 
Spain  EU/United States  28/01/2019  Panel established but 
not yet composed  WT/DS577  
Tariff treatment on 
certain goods in the 
information and 
communications 
technology sector  EU/India  02/04/2019  In consultations  WT/DS582  
Certain measures 
concerning the 
production, 
importation and 
marketing of 
pharmaceutical 
products  EU/Turkey  02/04/20 19 In consultations  WT/DS583  
EU as respondent      
Additional duties on 
certain products 
from the 
United  States  United States/EU  16/07/2018  Panel composed  WT/DS559  
Source:  WTO Secretariat . 
  WT/TPR/S/395 • European Union  
 
- 265 - 
 
  Table A2. 3 Participation in RTAs (notified and non -notified in force), as at 
30 September  2019  
RTA name Date of 
entry into 
force  Coverage  GATT/WTO notification   
Year WTO provision  
EU-Japan  01/02/19 Goods & 
Services  2019 GATT Art. XXIV & GATS Art. V  
EU-Armenia  01/06/18 Services  2019 GATS Art. V  
EU-Canadaa 21/09/17 Goods & 
Services  2017 GATT Art. XXIV & GATS Art. V  
EU-Colombia and Peru - 
Accession of Ecuador  01/01/17 Goods & 
Services  2017 GATT Art. XXIV & GATS Art. V  
EU-Ghana  15/12/16 Goods  2017 GATT Art. XXIV  
EU-SADCb 10/10/16 Goods  2017 GATT Art. XXIV  
EU-Côte d'Ivoire  03/09/16 Goods  2008 GATT Art. XXIV  
EU-Georgia  01/09/14 Goods & 
Services  2014 GATT Art. XXIV & GATS Art. V  
EU-Republic of Moldova  01/09/14 Goods & 
Services  2014 GATT Art. XXIV & GATS Art. V  
EU-Cameroon  04/08/14 Goods  2009 GATT Art. XXIV  
EU-Ukraine  23/04/14 Goods & 
Services  2014 GATT Art. XXIV & GATS Art. V  
EU-Central Americac 01/08/13 Goods & 
Services  2013 GATT Art. XXIV & GATS Art. V  
EU-Colombia and Peru  01/03/13 Goods & 
Services  2013 GATT Art. XXIV & GATS Art. V  
EU-Eastern and Southern 
Africa States Interim EPA  14/05/12 Goods  2012 GATT Art. XXIV  
EU-Republic of Korea  01/07/11 Goods & 
Services  2011 GATT Art. XXIV & GATS Art. V  
EU-Serbia  01/02/10 
01/09/13 Goods  
Services  2010 
2013 GATT Art. XXIV  
GATS Art. V  
EU-Papua New Guinea / 
Fiji 20/12/09 Goods  2011 GATT Art. XXIV  
EU-CARIFORUM States 
EPA 29/12/08 Goods & 
Services  2008 GATT Art. XXIV & GATS Art. V  
EU-Bosnia and 
Herzegovina  01/07/08 
01/06/15 Goods  
Services  2008 
2016 GATT Art. XXIV  
GATS Art. V  
EU-Montenegro  01/01/08 
01/05/10 Goods  
Services  2008 
2010 GATT Art. XXIV  
GATS Art. V  
EU-Albania  01/12/06 
01/04/09 Goods  
Services  2007 
2009 GATT Art. XXIV  
GATS Art. V  
EU-Algeria  01/09/05 Goods  2006 GATT Art. XXIV  
EU-Egypt  01/06/04 Goods  2004 GATT Art. XXIV  
EU-Lebanon  01/03/03 Goods  2003 GATT Art. XXIV  
EU-Chile 01/02/03 
01/03/05 Goods  
Services  2004 
2005 GATT Art. XXIV  
GATS Art. V  
EU-Jordan  01/05/02 Goods  2002 GATT Art. XXIV  
EU-San Marino  01/04/02 Goods  2010 GATT Art. XXIV  
EU-North Macedonia  01/06/01 
01/04/04 Goods  
Services  2001 
2009 GATT Art. XXIV  
GATS Art. V  
EU-Mexico  01/07/00 
01/10/00 Goods  
Services  2000 
2002 GATT Art. XXIV  
GATS Art. V  
EU-Israel  01/06/00 Goods  2000 GATT Art. XXIV  
EU-Morocco  01/03/00 Goods  2000 GATT Art. XXIV  
EU-South Africa  01/01/00 Goods  2000 GATT Art. XXIV  
EU-Tunisia  01/03/98 Goods  1999 GATT Art. XXIV  
EU-Palestinian Authority  01/07/97 Goods  1997 GATT Art. XXIV  
EU-Faroe Islands  01/01/97 Goods  1997 GATT Art. XXIV  
EU-Turkey  01/01/96 Goods  1995 GATT Art. XXIV  
EEA 01/01/94 Services  1996 GATS Art. V  
EU-Andorra  01/04/91 Goods  1998 GATT Art. XXIV  
EU-Syria 01/07/77 Goods  1977 GATT Art. XXIV  
EU-Norway  01/07/73 Goods  1973 GATT Art. XXIV  
EU-Iceland  01/04/73 Goods  1972 GATT Art. XXIV  WT/TPR/S/395 • European Union  
 
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  RTA name Date of 
entry into 
force  Coverage  GATT/WTO notification   
Year WTO provision  
EU-Switzerland –
Liechtenstein  01/01/73 Goods  1972 GATT Art. XXIV  
EU–Overseas Countries 
and Territories (OCT)  01/01/71 Goods  1970 GATT Art. XXIV  
EU-Kosovod 01/04/16 Goods  Not notified  
a Starting date for provisional application.  
b The Agreement has been provisionally applied between Botswana, Eswatini, Lesotho, Namibia, 
South  Africa and the EU as from 10 October 2016; and between Mozambique and the EU as from 
4 February 2018. The Agreement will enter into force after it has been ratified by all the Parties.  
c The notifications made in February 2013 (see  WTO documents  WT/REG332/N/1 and S/C/N/680 , 
27 February 2013 ) stated that: "Provisional application of the Agreement by all sig natory parties is 
expected in the course of the second quarter 2013"; further notifications to confirm the dates of 
entry into force between the EU and Central American countries are awaited.  
d All references to Kosovo in this report should be understood i n the context of UNSC 1244 (1999).  
Source:  WTO Secretariat. Further information may be found in the WTO Database on RTAs . Viewed at : 
http://rtais.wto.org .   
  WT/TPR/S/395 • European Union  
 
- 267 - Table A3. 1 WTO  TRQs, agricultural and non -agricultural products, 2018 -19 
Agricultural TRQs: 
HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
ex 0102 29  Live bovine animals  710 head  
(01.07.17 -
30.06.18)  6% 0 head  0.0%  Regulation 438/2009  
ex 0102 29  Live bovine animals  711 head  
(01.07.17 -
30.06.18)  4% 0 head 0.0%  Regulation 438/2009  
ex 0102 29  Live bovine animals  24,070 head  
(01.07.17 -
30.06.18)  16% 
EUR 
582/1,000kg/net  0 head 0.0%  Regulation 438/2009  
ex 0201  
ex 0202 
 
 
ex 0206 10 95  
 
ex 0206 29 91  Meat of bovine animals, fresh or 
chilled  
Meat of bovine animals, frozen  
Edible offal:  
- Of bovine animals, fresh or chilled  
-- Thick skirt and thin skirt  
- Of bovine animals, frozen  
-- Thick skirt and thin skirt  37,950 t 
(product weight)  
(01.07.17 -
30.06.18)  20% 26,256 t  69.2%  
Regulation 593/2013  
 
0202 
 
 
0206 29 91  Meat of bovine animals, frozen  
Edible offal  
- Of bovine animals, frozen  
-- Thick skirt and thin skirt, frozen  54,875 t  
(without bone)  
(01.07.17 -
30.06.18)  20% 54,875 t  100.0%  Regulation 593/2013  
 
 
 
ex 0201 30 00  
ex 0202 30 90  Meat of bovine animals, fresh or 
chilled, or frozen  
- Boneless  
-- Buffalo meat  200 t  
(without bone)  
(01.07.17 -
30.06.18)  20% 15 t 7.5%  Regulation 593/2013  
 
 
ex 0202 30 90  Meat of bovine animals, frozen  
- Boneless  
-- Buffalo meat  2,250 t  
(without bone)  
(01.07.17 -
30.06.18)  20% 0 t 0.0%  Regulation 593/2013  
 
ex 0202 20 30  
ex 0202 30  
 
 
 
ex 0206 29 91  Meat of bovine animals, frozen  
- Unseparated or separated 
forequarters  
– Boneless  
 
Edible offal  
- Of bovine animals, frozen  
-- Thick skirt and thin skirt  63,703 t  
(bone  in) 
(01.07.17 -
30.06.18)  20% (*) or EUR 
994.5/1 ,000kg/net 
(**) 788 t  1.2%  
Regulation 593/2013  
  
  WT/TPR/S/395 • European Union  
 
- 268 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
 
 
ex 0206 29 91  Edible offal  
- Of bovine animals,  frozen  
-- Thin skirt (whole)  1,500 t  
(01.07.17 -
30.06.18)  4% 0 t 0.0%  Regulation 593/2013  
 
 
ex 0201 30 00  
 
ex 0206 10 95  Boneless meat of bovine animals, 
fresh or chilled  
Edible offal of bovine animals: thick 
skirt and thin skirt, fresh or chilled  12,500 t  
(01.07.17 -
30.06.18)  20% 11,866 t  94.9%  
Regulation 593/2013  
 
 
ex 0201 30 00  
 
ex 0202 30 90  
 
 
ex 0206 10 95  
ex 0206 29 91  Boneless meat of bovine animals, 
fresh or chilled  
Boneless meat of bovine animals, 
frozen:  
- Other  
Edible offal of bovine animals:  
- Thick skirt and thin skirt, fresh or 
chilled  
- Thick skirt and thin skirt, frozen  10,000 t  
(01.07.17 -
30.06.18)  20% 5,060 t  50.6%  
Regulation 593/2013  
 
 
ex 0201 30 00  
 
ex 0202 30 90  
 
 
ex 0206 10 95  
ex 0206 29 91  Boneless meat of bovine animals, 
fresh or chilled  
Boneless meat of bovine animals, 
frozen:  
- Other  
Edible offal of bovine animals:  
- Thick skirt and thin skirt, fresh or 
chilled  
- Thick skirt and thin skirt, frozen  4,076 t  
(01.07.17 -
30.06.18)  20% 4,068 t  99.8%  
Regulation 593/2013  
 
ex 0201 20 90  
ex 0202 30 00  
 
 
ex 0202 20 90  
ex 0202 30  
 
 
ex 0206 10 95  
ex 0206 29 91  Meat of bovine animals, fresh, or 
chilled:  
- Other cuts with bone in, other  
- Boneless  
 
Meat of bovine animals, frozen:  
- Other cuts with bone in, other  
- Boneless  
 
Thick and thin bovine skirt, fresh or 
chilled  
Thick and thin bovine skirt, frozen  1,300 t  
(01.07.17 -
30.06.18)  20% 1,119 t  86.1%  
Regulation 431/2008  
0203 11 10  
0203 21 10  Meat of swine  
- Carcasses and half -carcasses of 
domestic swine, fresh, chilled and 
frozen  15,067 t  
(01.07.17 -
30.06.18)  EUR 268/1,000kg/ 
net 0 t* 0.0%  Regulation 442/2009  
0203 12 11  
0203 12 19  
0203 19 11  Meat of swine  
- Cuts of domestic swine, fresh, 
chilled or frozen, with or without 10,759 t  
(01.07.17 -
30.06.18)  EUR 795/1,000 
kg/net  781 t  7.3%  Regulation 442/2009   
  WT/TPR/S/395 • European Union  
 
- 269 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
0203 19 13  
0203 19 15  
ex 0203 19 55  
0203 19 59  
0203 22 11  
0203 22 19  
0203 29 11  
0203 29 13  
0203 29 15  
ex 0203 29 55  
0203 29 59  bone, excluding tenderloin presented 
alone  
ex 0203 19 55  
ex 0203 29 55  Meat of swine  
- Boneless loins and hams, fresh or 
chilled  
- Boneless loins and hams, frozen  35,265 t  
(01.07.17 -
30.06.18)  EUR 250/1,000kg/ 
net 1,005 t  2.9% Regulation 442/2009  
ex 0203 19 55  
ex 0203 29 55  Boneless loins and hams of domestic 
swine, fresh, chilled or frozen  4,922 t  
(01.07.17 -
30.06.18)  EUR 250/ 
1,000kg/net  0 t 0.0%  Regulation 442/2009  
ex 0203 19 55  
ex 0203 29 55  Meat of swine  
- Tenderloins, fresh or chilled  
- Tenderloins, frozen  5,000 t  
(01.07.17 -
30.06.18)  EUR 300/1,000kg/ 
net 0 t* 0.0%  Regulation 442/2009  
0207 11 10  
0207 11 30  
0207 11 90  
0207 12 10  
0207 12 90  Chicken carcass, fresh, chilled or 
frozen  6,249 t  
(01.07.17 -
30.06.18  EUR 131 -162/ 
1,000kg/ net  4,872 t  78.0%  Regulation 536/2007  
0207 13 10  
0207 13 20  
0207 13 30  
0207 13 40  
0207 13 50  
0207 13 60  
0207 13 70  
0207 14 20  
0207 14 30  
0207 14 40  
0207 14 60  Chicken cuts, fresh, chilled or frozen  8,570 t  
(01.07.17 -
30.06.18)  EUR 93 -512/1,000 
kg / net  8,570 t  100.0%  Regulation 536/2007  
0207 14 10  - Poultry cuts and offal other than 
liver, frozen:  
-- Of fowls of the species Gallus 
domesticus : 
--- Cuts:  
---- Boneless  2,705 t  
(01.07.17 -
30.06.18)  EUR 
795/1 ,000kg/net  2,705 t  100.0%  Regulation 1385/2007   
  WT/TPR/S/395 • European Union  
 
- 270 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
0207 24 10  
0207 24 90  
0207 25 10  
0207 25 90  
0207 26 10  
0207 26 20  
0207 26 30  
0207 26 40  
0207 26 50  
0207 26 60  
0207 26 70  
0207 26 80  
0207 27 30  
0207 27 40  
0207 27 50  
0207 27 60  
0207 27 70  Turkey meat, fresh, chilled  
 
 
 
 
 
 
 
 
 
 1,781 t  
(01.07.17 -
30.06.18)  EUR 93 -425/1,000kg 
/net 0 t 0.0%  Regulation 533/2007  
0207 11 10  
0207 11 30  
0207 11 90  
0207 12 10  
0207 12 90  
 
0207 13 10  
0207 13 20  
0207 13 30  
0207 13 40  
0207 13 50  
0207 13 60  
0207 13 70  
 
0207 14 10  
0207 14 20  
0207 14 30  
0207 14 40  
0207 14 50  
0207 14 60  
0207 14 70  Meat and edible offal of poultry, 
fresh, chilled or frozen  21,345 t  
(01.07.17 -
30.06.18)  EUR 93 -425/ 
1,000kg/  net 365 t  1.7%  Regulation 536/2007  
ex 0210 99 39  Salted poultry meat  264,245 t 
(01.07.17 -
30.06.18)  15.4%  231,515 t 87.6%  Regulation 616/2007  
0402 10 19  Skimmed milk powder  68,537 t  
(01.07.17 -
30.06.18)   EUR 
475/1,000kg/net  0 t 0.0%  Regulation 2535/2001   
  WT/TPR/S/395 • European Union  
 
- 271 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
0405 10 00  
0405 90 00  Butter  11,360 t  
(01.07.17 -
30.06.18 )  EUR 948/1,000kg/ 
net 0 t 0.0%  Regulation 2535/2001  
ex 0406 10 30  
ex 0406 10 50  
ex 0406 10 80  Fresh cheese (unripened or 
uncured), including whey cheese and 
curd:  
-- Pizza cheese, frozen, cut into 
pieces, each weighing not more than 
1 g, in containers of minimum 5 kg, 
with a moisture content of 52%, and 
a fat content of minimum 38%  5,360 t  
(01.07.17 -
30.06.18)  EUR 130/1,000kg/ 
net 0 t 0.0%  Regulation 2535/2001  
ex 0406 30 10  
0406 90 13  Cheese and curd:  
- Emmental, including processed 
Emmental  18,438 t  
(01.07.17 -
30.06.18)  EUR 719 -858/1,000 
kg/ net  0 t 0.0%  Regulation 2535/2001  
ex 0406 30 10  
0406 90 15  Gruyere, Sbrinz, including processed  
Gruyere  5,413 t  
(01.07.17 -
30.06.18  EUR 719 -858/ 
1,000kg/ net  0 t 0.0%  Regulation 2535/2001  
0406 90 01  Cheese for processing  20,007 t  
(01.07.17 -
30.06.18)  EUR 835/ 1,000kg/ 
net 0 t 0.0%  Regulation 2535/2001  
0406 90 21  Cheddar  15,005 t  
(01.07.17 -
30.06.18)  EUR 210/ 1,000 kg/ 
net 3,000 t  20.0%  Regulation 2535/2001  
ex 0406 10 30  
ex 0406 10 50  
ex 0406 10 80  
ex 0406 20 00  
0406 30 31  
0406 30 39  
0406 30 90  
0406 40 10  
0406 40 50  
0406 40 90  
0406 90 17  
0406 90 18  
0406 90 23  
0406 90 25  
0406 90 27 
0406 90 29  
0406 90 32  
0406 90 35  Other cheeses  19,525 t  
(01.07.17 -
30.06.18)  EUR 690 -1,064/ 
1,000 kg/ net  194 t  1.0%  Regulation 2535/2001  
0407 21 00  
0407 29 10  
0407 90 10  Poultry eggs for consumption, in 
shell 135,000 t 
(01.07.17 -
30.06.18)  EUR 152/ 1,000 kg/ 
net 2,088 t  1.6%  Regulation 539/2007   
  WT/TPR/S/395 • European Union  
 
- 272 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
0408 11 80  
0408 19 81  
0408 19 89  
 
0408 91 80  
0408 99 80  Eggs yolks  
 
 
 
Bird eggs, not in shell  7,000 t  
(shell egg 
equivalent)  
(01.07.17 -
30.06.18)  EUR 176 -711/ 
1,000kg/ net  5,380 t  76.9%  Regulation 539/2007  
0703 20 00  Garlic  73,395 t  
(01.06.17 -
31.05.18)  9.6%  43,304 t  59.0%  Regulation 341/2007  
ex 0707 00 05  Cucumbers, fresh or chilled,  
- From 1 November to 15 May   1,134 t  
(01.11.17 -
15.05.18)  Ad valorem  duty 
reduced to 2.5  13 t 1.1%  Regulation 1831/1996  
ex 0809 10 00  Apricots, fresh, 1.08 -31.05  500 t  
(01.08.17 -
31.05.18)  10% 36 t 7.2%  Regulation 1831/1996  
ex 1001 19 00  Durum wheat  50,000 t  
(01.07.17 -
30.06.18)  0% 0 t 0.0%  Regulation 2133/2001  
1008 21 00 
1008 29 00  Millet  1,300 t  
(01.07.17 -
30.06.18)  EUR 7/ 1,000 kg/ 
net 1,300 t  100.0%  Regulation 2133/2001  
1104 22 95  Worked oats, other than kibbled  10,000 t  
(01.07.17 -
30.06.18)  0% 99 t 1.0%  Regulation 2094/2004  
1601 00 91  
1601 00 99  Sausages, dry or for spreading, 
uncooked  
Other sausages  3,002 t  
(01.07.17 -
30.06.18)  EUR 502 -747/ 1,000 
kg/ net  601 t  20.0%  Regulation 442/2009  
1602 31 00  Prepared turkey meat  103,896 t 
(01.07.17 -
30.06.18)  8.5%  26,797 25.8%  Regulation 616/2007  
1602 32 11 Processed chicken meat, uncooked, 
containing 57 % or more by weight of 
poultry meat or offal  16,140 t  
(01.07.17 -
30.06.18)  EUR 630/ 
1,000kg/net  12,640 t  78.3%  Regulation 616/2007  
1602 32 19  Cooked chicken meat  250,953 t  
(01.07.17 -
30.06.18)  8% 243,658 t 97.1%  Regulation 616/2007  
1602 32 30  Processed chicken meat, containing 
25% or more but less than 57% by 
weight of poultry meat or offal  79,705 t  
(01.07.17 -
30.06.18)  10.9%  67,324 t  84.5%  Regulation 616/2007  
1602 32 90 Processed chicken meat, containing 
less than 25% by weight of poultry 
meat or offal  2,865 t  
(01.07.17 -
30.06.18)  10.9%  2,100 t  73.3%  Regulation 616/2007   
  WT/TPR/S/395 • European Union  
 
- 273 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
1602 39 21  Processed duck, geese, guinea fowl 
meat, uncooked, containing 57% or 
more by weight of poultry meat or 
offal 10 t  
(01.07.17 -
30.06.18)  EUR 630/ 1 ,000kg/net  0 t 0.0%  Regulation 616/2007  
1602 39 29  Processed duck, geese, guinea fowl 
meat, cooked, containing 57% or 
more by weight of poultry meat or 
offal 13,720 t  
(01.07.17 -
30.06.18)  10.9%  5,748 t  41.9%  Regulation 616/2007  
Ex 1602 39 85  Processed duck, geese, guinea fowl 
meat, cooked, containing 25% or 
more but less than 57% by weight of 
poultry meat or offal  748 t  
(01.07.17 -
30.06.18)  10.9%  0 t 0.0%  Regulation 616/2007  
Ex 1602 39 85  Processed duck, geese, guinea fowl 
meat, cooked, containing less than 
25% by weight of poultry meat or 
offal 725 t  
(01.07.17 -
30.06.18)  10.9%  10 t 1.4%  Regulation 616/2007  
1602 41 10  
1602 42 10  
1602 49 11  
1602 49 13  
1602 49 15  
1602 49 19  
1602 49 30  
1602 49 50  Preserved meat of domestic swine  6,161 t  
(01.07.17 -
30.06.18)  EUR 271 -784/ 
1,000kg/ net  3 t 0.1%  Regulation 442/2009  
1701 Cane or beet sugar  10,000 t (1)  
(White sugar 
equivalent)  
(01.10.17 -
30.09.18)  0% 10,000 t  100.0%   
1701 13 10  
1701 14 10  Raw cane sugar, for refining  809,425 t 
(01.10.17 -
30.09.18)  EUR 98/1 ,000kg/net  54,549 t  6.7%  Regulation 891/2009  
1702 50 00  Chemically pure fructose  4,504 t  
(01.01.17 -
30.06.18)  16% 30 t 0.7%  Regulation 32/2000  
1704 00 00  Sugar confectionary  2,289 t  
(01.07.17 -
30.06.18)  35% 109 t  4.8%  Regulation 50/2015  
1806 20 00  
1806 31 00  
1806 32 00  
1806 90 00  Chocolate  2,026 t  
(01.07.17 -
30.06.18)  38% 104 t  5.1%  Regulation 50/2015   
  WT/TPR/S/395 • European Union  
 
- 274 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
1905 90 00  Biscuits  409 t  
(01.07.17 -
30.06.18)  40% 409 t  100.0%  Regulation 50/2015  
ex 2009 61 90  
 
 
 
ex 2009 69 11  
ex 2009 69 19  
 
 
 
ex 2009 69 51  
 
 
ex 2009 69 90  Grape juice (including grape must):  
-- Of a Brix value not exceeding 30  
--- Of a value not exceeding EUR  
18/100 kg net weight  
-- Other  
-- Of a Brix value exceeding 67  
---- Of a value not exceeding EUR  
22/100  kg net weight  
---- Other  
--- Of a Brix value exceeding 30 but 
not exceeding 67  
---- Of a value exceeding EU R 
18/100 kg net weight:  
----- Concentrated  
---- Of a value not exceeding EUR  
18/100  kg net weight  
----- Other  14,029 t  
(01.09.17 -
31.08.18)  22.4% -
EUR 40+EUR  20.6/ 
1,000  kg/ net  0 t 0.0%  Regulation 1472/2003  
2106 90 98  Food preparation  1,550 t  
(01.07.17 -30.6.18)  E.A. 1,550 t  100.0%  Regulation 624/2013  
3502 11 90  
3502 19 90  Egg albumin  15,500 t  
(shell egg 
equivalent)  
(01.07.17 -
30.06.18)  EUR 83 -617/ 
1,000kg/ net  1,320 t  8.5%  Regulation 539/2007  
0104 10 30  
0104 10 80  
0104 20 90  Live sheep, other than pure -bred 
breeding animals  196 t (1)  
(live weight)  
(01.01.18 -
31.12.18)  10% 0 t 0.0% Regulation 1354/2011  
 
 
 
0203 19 13  
 
 
0203 29 15  Meat of swine, fresh, chilled or 
frozen:  
- Fresh or chilled:  
-- of domestic swine  
--- loins and cuts thereof, bone  in 
- Frozen:  
-- of domestic swine  
--- bellies, streaky and cuts thereof  7,000 t  
(01.01.18 -
31.12.18)  0% 15 t 0.2% Regulation 442/2009  
0204 Meat of sheep or goats, fresh, chilled 
or frozen  280,475 t (2)  
(carcass weight)  
(01.01.18 -
31.12.18)  0% 167,241 t 59.6% Regulations 1354/2011, and 
562/2018   
  WT/TPR/S/395 • European Union  
 
- 275 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
 
 
0207 14 10  
 
0207 14 50  
0207 14 70  - Poultry cuts and offal other than 
liver, frozen:  
-- Of fowls of the species Gallus  
domesticus : 
--- Cuts:  
---- Boneless  
---- With bone in:  
---- Breasts and cuts thereof  
---- Other (than halves and quarters; 
whole wings with or without tips; 
backs, necks, backs with necks 
attached, rumps and wing tips; legs 
and cuts thereof)  25,098 t  
(01.01.18 -
31.12.18)  0% 25,098 t  100.0 % Regulation 536/2007  
 
 
 
 
0207 27 10  
 
0207 27 20  
0207 27 80  Poultry cuts and offal other than 
livers, frozen:  
- Of turkeys:  
-- Cuts:  
--- Boneless  
--- With bone in:  
---- Halves or quarters  
---- Other (than whole wings, with or 
without tips; backs, necks, backs 
with necks attach ed, rumps and wing 
tips, breasts and cuts thereof; legs 
and cuts thereof)  8,095 t  
(01.01.18 -
31.12.18)  0% 7,443 t  92.0% Regulation 536/2007  
ex 0405 10 11  
ex 0405 10 19  
ex 0405 10 30  Butter  74,693 t  
(01.01.18 -
31.12.18)  EUR 70/ 1,000 kg/ 
net 1,225 t  1.6% Regulation 2535/2011  
0406 90 01  Cheese for processing  4,500 t  
(01.01.18 -
31.12.18)  EUR 17.06/ 
1,000  kg/ net  0 t 0.0% Regulation 2535/2011  
ex 0406 90 21  Cheddar  10,711 t  
(01.01.18 -
31.12.18)  EUR 17.06/ 
1,000  kg/ net  220  2.1 Regulation 2535/2011  
ex 0406 90 21  Cheddar  4,000 t  
(01.01.18 -
31.12.18)  EUR 13.5/ 1,000  kg/ 
net 0 t 0.0 Regulation 2535/2011  
ex 0701 90 50  Potatoes, fresh or chilled, new,  
1.01-15.05  4,295 t  
(01.01.18 -
15.05.18)  3% 4,295 t  100.0 % Regulation 1831/1996  
0702 00 00  Tomatoes  472 t  
(01.01.18 -
31.12.18)  12% 472 t  100.0 % Regulation 973/2006   
  WT/TPR/S/395 • European Union  
 
- 276 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
0706 10 00  Carrots and turnips, fresh or chilled  1,244 t  
(01.01.18 -
31.12.18)  7% 1,244 t  100.0 % Regulation 1831/1996  
0709 60 10  Sweet peppers, fresh or chilled  500 t  
(01.01.18 -
31.12.18)  1.5%  500 t  100.0 % Regulation 1831/1996  
0712 20 00  Dried onions  12,000 t  
(01.01.18 -
31.12.18)  10% 8,818 t  73.5% Regulation 1831/1996  
0714 10 00  Manioc (cassava)  5,750,000 t  
(01.01.18 -
31.12.18)  6% 2,392 t  0.0% Regulation 1475/2007  
0714 10 00  
0714 30 00  
0714 40 00  
0714 50 00  
0714 90 20  Manioc (cassava), other than pellets 
of flour and meal  
Arrowroot, salep and similar roots 
and tubers with a high starch 
content  1,352,590 t  
(01.01.18 -
31.12.18)  6% 3,316 t  0.2% Regulation 1085/2010  
 
0714 20 90  Sweet potatoes  
- Other than for human consumption  5,000 t  
(01.01.18 -
31.12.18)  0% 95 t 1.9% Regulation 1085/2010  
 
0714 20 90  Sweet potatoes  
- Other than for human consumption  600,000 t 
(01.01.18 -
31.12.18)  0% 19,407 t  3.2% Regulation 1085/2010  
0802 11 90  
0802 12 90  Almonds, other than bitter  90,000 t  
(01.01.18 -
31.12.18)  2% 90,000 t  100.0 % Regulation 1831/1996  
 
ex 0805 10  Oranges  
- Sweet oranges  20,000 t  
(01.02.18 -
30.04.18)  10% 0 t 0.0% Regulation 1831/1996  
ex 0805 29 00  Other citrus fruit hybrids  15,000 t  
(01.02.18 -
30.04.18)  2% 5,445 t  36.3% Regulation 1831/1996  
ex 0805 50 10  Lemons  
15.01. -14.06  10,000 t  
(15.01.18 -
14.06.18)  6% 9,503 t  95.0% Regulation 1831/1996  
ex 0806 10 10  Table grapes, fresh  
21.07 -31.10  1,500 t  
(21.07.18 -
31.10.18)  Ad valorem  duty 
reduced to 9%  1,500 t 100.0 % Regulation 1831/1996  
ex 0808 10 80  Apples, fresh  
1.04-31.07  696 t  
(01.04.18 -
31.07.18)  Ad valorem  duty 
reduced to 0 696 t  100.0 % Regulation 1831/1996  
ex 0808 30 90  Pears, fresh, other than perry pears , 
in bulk  
1.08-31.12  1,000 t  
(01.08.18 -
31.12.18)  Ad valorem  duty 
reduced to 5% 1,000 t  100.0 % Regulation 1831/1996   
  WT/TPR/S/395 • European Union  
 
- 277 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
ex 0809 10 00  Apricots, fresh  
1.06-31.07  2,500 t  
(01.06.18 -
31.07.18)  Ad valorem  duty 
reduced to 10% 0 t 0.0% Regulation 1831/1996  
ex 0809 29 00  Cherries, fresh, other than sour 
cherries  
21.05 -15.07  800 t  
(21.05.18 -
15.07.18)  Ad valorem  duty 
reduced to 4% 25 t 3.1% Regulation 1831/1996  
ex 1001 19 00  
ex 1001 99 00  Wheat  300,000 t 
(01.01.18 -
31.12.18)  0% 288 t  0.1% Regulation 2133/2001  
ex 1001 99 00  Common wheat  
(medium and low quality)  3,112,030 t  
(01.01.18 -
31.12.18)   EUR 12/ 1,000  kg/ 
net 1,631,534 t 52.4% Regulation 2133/2001  
ex 1003 00  Malting barley  50,890 t  
(01.01.18 -
31.12.18)  EUR 8/ 1,000  kg/ 
net 0 t 0.0% Regulation 2305/2003  
1003 00  Barley  307,105 t 
(01.01.18 -
31.12.18)  EUR 16/ 1,000  kg/ 
net 22,189 t  7.2% Regulation 2305/2003  
1005 10 90  
1005 90 00  Maize  277,988 t 
(01.01.18 -
31.12.18)  0% 277,988 t 100.0 % Regulation 969/2006  
1005 90 00  Maize  2,000,000 t  
(01.01.18 -
31.12.18) (3)  Rate to be fixed b y 
competent 
Community 
authorities  2,000,000 t  100.0 % Regulations 1342/2003 and 
1296/2008  
1005 90 00  Maize  500,000 t 
(01.01.18 -
31.12.18) (3)  Max EUR 50/ 
1,000  kg/ net  500,000 t 100.0 % Regulations 1342/2003 and 
1296/2008  
1006 10 00  Paddy rice  7 t 
(01.01.18 -
31.12.18)  15% 7 t 100.0 % Regulation 1273/2011  
1006 20 00  Husked (brown) rice  1,634 t  
(01.01.18 -
31.12.18)  15% 24 t 1.5% Regulation 1273/2011  
1006 30 00  Semi-milled or wholly milled rice  63,000 t  
(01.01.18 -
31.12.18)  0% 63,000 t  100.0 % Regulation 1273/2011  
1006 30 00  Semi-milled or wholly milled rice  13,500 t  
(01.01.18 -
31.12.18)  0% 13,500 t  100.0 % Regulation 1273/2011  
1006 30 00  Semi-milled or wholly milled rice  26,716 t  
(01.01.18 -
31.12.18)  0% 26,716 t  100.0 % Regulation 1273/2011   
  WT/TPR/S/395 • European Union  
 
- 278 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
1006 40 00  Broken rice, intended for the 
production of foodstuffs of tariff 
heading 1901 10  1,000 t  
(01.01.18 -
31.12.18)  0% 0 t 0.0% Regulation 480/2012  
1006 40 00  Broken rice  100,000 t 
(01.01.18 -
31.12.18)  EUR 45/ 1,000  kg/ 
net 10,366 t  10.4% Regulation 1273/2011  
1006 40 00  Broken rice  31,788 t  
(01.01.18 -
31.12.18)  0% 31,788 t  100.0 % Regulation 1273/2011  
1007 10 90  
1007 90 00  Grain sorghum  300,000 t 
(01.01.18 -
31.12.18) (3)  This rate will be 
fixed by the 
competent 
Community 
authorities  300,000 t 100.0 % Regulations 1342/2003 and 
1296/2008  
ex 1108 14 00  Manioc starch  8,000 t  
(01.01.18 -
31.12.18) (4)  EUR 170.59/ 
1,000  kg/ net  8,000 t  100.0 % Regulation 1085/2010  
ex 1108 14 00  Manioc starch  2,000 t  
(01.01.18 -
31.12.18) (4)  EUR 170.59/ 
1,000  kg/ net  2,000 t  100.0 % Regulation 1085/2010  
1702 50 00  Chemically pure fructose  1,253 t  
(01.01.18 -
31.12.18)  20% 0 t 0.0% Regulation 32/2000  
1806 00 00  Chocolate  107 t  
(01.01.18 -
31.12.18)  43% 3 t 2.8% Regulation 928/2006  
ex 1902  Pasta  532 t  
(01.01.18 -
31.12.18)  11% 532 t  100.0 % Regulation 32/2000  
1901 90 99  
1904 30 00  
1904 90 80  
1905 90 20  Food preparations of cereals  191 t  
(01.01.18 -
31.12.18)  33% 191 t  100.0 % Regulation 32/2000  
 
 
 
2003 10 20  
 
2003 10 30  
 
0711 51 00  Mushrooms, prepared or preserved 
otherwise than by vinegar or acetic 
acid: 
- Of the species Agaricus : 
-- Provisionally preserved, 
 completely cooked  
-- Other  
 Vegetables provisionally preserved 
 but unsuitable in that state for 
 immediate consumption:  
 Mushrooms of the species Agaricus  35,430 t  
(01.01.18 -
31.12.18)  
 12-23% 1,093 t  3.1% Regulation 1973/2006   
  WT/TPR/S/395 • European Union  
 
- 279 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
2008 20 11  
2008 20 19  
2008 20 31  
2008 20 39  
2008 20 71  
2008 30 11  
2008 30 19  
2008 30 31  
2008 3 0 39 
2008 30 79  
2008 40 11  
2008 40 19  
2008 40 21  
2008 40 29  
2008 40 31  
2008 40 39  
2008 50 11  
2008 50 19  
2008 50 31  
2008 50 39  
2008 50 51  
2008 50 59  
2008 50 71  
2008 60 11  
2008 60 19  
2008 60 31  
2008 60 39  
2008 60 60  
2008 70 11  
2008 70 19  
2008 70 31  
2008 70 39  
2008 70 51  
2008 70 59  
2008 80 11  
2008 80 19  
2008 80 31  
2008 80 39  
2008 80 70  Preserved fruit  2,838 t  
(01.01.18 -
31.12.18)  20% 945 t  33.3%  Regulation 973/2006  
 
 
 
ex 2009 11 99  Orange juice  
- Frozen  
-- Of a density not exceeding 
 1.33 g/cm3 at 20°C  
--- Other  1,500 t  
(01.01.18 -
31.12.18)  13% 0 t 0.0% Regulation 1831/1996   
  WT/TPR/S/395 • European Union  
 
- 280 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
2009 11 11  
2009 11 19  
2009 19 11  
2009 19 19  
2009 29 11  
2009 29 19  
2009 39 11  
2009 39 19  
2009 49 11  
2009 49 19  
2009 79 11  
2009 79 19  
2009 81 11  
2009 81 19  
2009 89 11  
2009 89 19  
2009 89 34  
2009 89 35  
2009 89 36  
2009 89 38  
2009 90 11  
2009 90 19  
2009 90 21  
2009 90 29  Fruit juices  7,044 t  
(01.01.18 -
31.12.18)  20% 7,034 t  99.9% Regulation 973/2006  
2106 90 98  Food preparations - others  921 t  
(01.01.18 -
31.12.18)  18% 921 t  100.0 % Regulations 928/2006 and 
624/2013  
2204 21 93  
2204 21 95  
2204 21 97  
2204 21 94  
2204 21 96  
2204 21 98  Wine of fresh grapes  40,000 hl  
(01.01.18 -
31.12.18)  EUR 10/ hl  40,000 hl  100.0 % Regulation 218/2007  
2204 22 93  
2204 22 95  
2204 22 97  
2204 22 94  
2204 22 96  
2204 22 98  
2204 29 93  
2204 29 95  
2204 29 97  
2204 29 94  Wine of fresh grapes  20,000 hl  
(01.01.18 -
31.12.18)  EUR 8/ hl  20,000 hl  
 100.0%  Regulation 218/2004   
  WT/TPR/S/395 • European Union  
 
- 281 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
2204 29 96  
2204 29 98  
2205 90 10  Vermouth  13,810 hl  
(01.01.18 -
31.12.18)  EUR 7/ hl  0 hl 0.0% Regulation 1518/2007  
 
 
 
 
2302 30 10  
 
 
 
 
 
2302 30 90  
 
2302 40 10  
 
 
 
 
 
 
2302 40 90  Bran, sharps and other residues , 
whether or not in the form of pellets , 
derived from the sifting, milling or 
other working of cereals:  
- Of wheat:  
-- Of which the starch content does 
 not exceed 28% by weight, and of 
 which the proportion that passes 
 through a sieve with an aperture 
 of 0.2  mm does not exceed 10% 
 by weight or alternatively the 
 proportion that passes through 
 the sieve has an ash content, 
 calculated on the dry product, 
 equal to or more than 1.5% by 
 weight  
-- Other  
- Of other cereals (than ma ize or 
 rice):  
-- Of which the starch content does 
 not exceed 28% by weight, and of 
 which the proportion that passes 
 through a sieve with an aperture 
 of 0.2  mm does not exceed 10% 
 by weight or alternatively the 
 proportion that passes through 
 the sieve has an ash content, 
 calculated on the dry product, 
 equal to or more than 1.5% by 
 weight  
-- Other  475,000 t 
(01.01.18 -
31.12.18)  EUR 30.6 -62.25/ 
1,000  kg/ net  216 t  0.0% Regulation 2133/2001  
2303 10 11  Corn gluten  10,000 t  
(01.01.18 -
31.12.18)  16% 8,181 t  81.8% Regulation 937/2006  
2309 10 13  
2309 10 15  
2309 10 19  
2309 10 33  
2309 10 39  Dog and cat food  2,058 t  
(01.01.18 -
31.12.18)  7% 1,001 t  48.6% Regulation 899/2006   
  WT/TPR/S/395 • European Union  
 
- 282 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
2309 10 51  
2309 10 53  
2309 10 59  
2309 10 70  
 
 
2309 90 31  
 
2309 90 41  
 
2309 90 51  
 
2309 90 96  Preparations of a kind used in animal 
feeding  
- Other:  
-- Containing no milk products or 
 containing less than 10% by 
 weight of such products  
-- Containing no or less than 10% by 
 weight of starch  
-- Containing more than 10% but not 
 more than 30% by weight of 
 starch  
-- Other  2,700 t  
(01.01.18 -
31.12.18)  7% 2,700 t  100.0 % Regulation 440/1996  
ex 2309 90 31  
 
 
 
 
 
ex 2309 90 41  Preparation s consisting of a mixture 
of malt sprouts and of barley 
screenings before the malting 
process (possibly including other 
seeds) with barley cleanings after 
the malting process, and containing 
by weight 15.5% or more of protein  
Preparation s consis ting of a mixture 
of malt sprouts and of barley 
screenings before the malting 
process (possibly including other 
seeds) with barley cleanings after 
the malting process, and containing 
by weight 15.5% or more of protein 
and not more than 23% of starch  100,000 t 
(01.01.18 -
31.12.18)  0% 0 t 0.0% Regulation 440/1996  
ex 2309 90 31  
 
 
 
 
ex 2309 90 41  Preparation s consisting of a mixture 
of malt sprouts and of barley 
screenings before the malting 
process (possibly including other 
seeds) with barley cleanings after 
the malting process, and containing 
by weight 12.5% or more of protein  
Preparation s consisting of a mi xture 
of malt sprouts and of barley 
screenings before the malting 
process (possibly including other 
seeds) with barley cleanings after 
the malting process, and containing 20,000 t  
(01.01.18 -
31.12.18)  0% 684 t  3.4% Regulation 2133/2001   
  WT/TPR/S/395 • European Union  
 
- 283 - HS code Products  Quota size  Quota rate  Quota 
imports  Quota fill rate  
(%) Legal basis  
by weight 12.5% or more of protein 
and not more than 28% of starch  
 
 
2309 90 31  
 
2309 90 41  
 
2309 90 51  Preparations of a kind used in animal 
feeding  
- Other:  
-- Containing no milk products or 
 containing less than 10% by 
 weight of such products  
-- Containing no or less than 10% by 
 weight of starch  
-- Containing more than 10% but not 
 more than 30% by weight of 
 starch  
-- Containing more than 30% by 
 weight of starch  2,800 t  
(01.01.18 -
31.12.18)  7% 2,800 t  100.0 % Regulation 88/2007  
(*)  When the meat is intended for the manufacture of preserved food which does not contain characteristic components other than beef a nd jelly.  
(**)  When the meat is intended for the manufacture of products other than the preserved food referred to in the first in dent. 
E.A.  Indicates that the goods are chargeable with an "agricultural component" fixed in accordance with Regulation (EEC) No. 2658/1 987. 
Source:  WTO secretariat based on WTO documents G/AG/N/EU/48, 30 October 2018 and G/AG/N/EU/50, 22 February 2019; a nd on Indicative list of WTO Tariff Quotas opened 
by the competent authorities of the European Union , 2018. CIRCABC. Viewed at: 
https://circabc.europa.eu/faces/jsp/extension/wai/navigation/container.jsp?FormPrincipal:_idcl=FormPrincipal:_id1&FormPrincip al_SUBMIT=1&id=37b43134 -17c0-
435d-97be-
83e2f684871c&javax.faces.ViewState=XeKNoB%2BqNgwElmtYmU1TNqyxInGy%2FRH8o3PI7E%2FK4meScsZ6X KYdW7nQzlHIOwK%2B3d9mnzfUQW8skFfzs0xvX4AH9y8
Rz6Oea1B%2FIWqr7mEZFKGOLCI7sfGACf2cGWPaVPL%2BPGus3MlzZAZnmYhi79smn0g%3D . 
Non-agricultural TR Qs  
HS code Products  Quota size  Quota 
rate Quota 
imports  Quota fill rate  
(%) Legal basis  
0302 40 00 ex01  
0303 50 00 ex01 
0304 10 97 ex01  
0304 10 98  
0304 90 22 ex01  
 Herrings  34,000 t 0% 29,334 t  87% Council Regulation 
(EC) No . 32/2000  
0302 69 68  
0303 78 19  
 Silver hake ( Merluccius bilinearis ) 2,000 t 8% 0 0% Council Regulation 
(EC) No . 32/2000   
  WT/TPR/S/395 • European Union  
 
- 284 - HS code Products  Quota size  Quota 
rate Quota 
imports  Quota fill rate  
(%) Legal basis  
0303 29 00  
 Fish of the genus Coregonus  1,000 t  5.5% 219 t  22% Council Regulation 
(EC) No . 32/2000  
0304 20 94  Fish of the genus Allocyttus  and of 
the species Pseudocyttus 
maculatus  200 t  0% 199 t  100%  Council Regulation 
(EC) No . 32/2000  
0305 51 10  
0305 51 90  
0305 59 11  
0305 59 19  
0305 62 00  
0305 69 10  Cod of the species Gadus morhua  
and Gadus ogac  
Fish of the species Boreogadus 
saida 25,000 t  0% 25,000 t  100%  
Council Regulation 
(EC) No . 32/2000  
1604 20 50  Prepared or preserved fish (excl. 
whole or in pieces): of sardines, 
bonito, mackerel of  the species 
Scomber scombrus  and Scomber 
japonicus , fish of the species 
Orcynopsis unicolor  865 t  0% 187 t 22% 
Council Regulation 
(EC) No . 32/2000  
1604 20 50  Prepared or preserved fish (excl. 
whole or in pieces): of sardines, 
bonito, mackerel of  the species 
Scomber scombrus  and Scomber 
japonicus , fish of the species 
Orcynopsis unicolor  1,410 t 0% 36 t 2.5%  
Council Regulation 
(EC) No . 32/2000  
1604 20 70  Prepared or preserved fish (excl. 
whole or in pieces): of tuna, 
skipjack or other fish of the genus 
Euthynnus  742 t  0% 742 t  100%  
Council Regulation 
(EC) No . 32/2000  
1604 20 70  Prepared or preserved fish (excl. 
whole or in pieces): of tuna, 
skipjack or other fish of the genus 
Euthynnus  1,816 t  0% 1,816 t  100%  
Council Regulation 
(EC) No . 32/2000  
1605 20 10  
1605 20 91  
1605 20 99  Shrimp of the species Pandalus 
borealis , shelled, boiled, frozen, 
but not further prepared  500 t  0% 500 t  100%  Council Regulation 
(EC) No . 32/2000  
1605 40 00  Freshwater crayfish, cooked in dill, 
frozen  3,000 t  0% 3,000 t  100%  Council Regulation 
(EC) No . 32/2000   
  WT/TPR/S/395 • European Union  
 
- 285 - HS code Products  Quota size  Quota 
rate Quota 
imports  Quota fill rate  
(%) Legal basis  
4412 19 00  
4412 92 99  
4412 99 80 Plywood of coniferous species, 
without the addition of other 
substances  
— of which the faces are not 
further prepared than the peeling 
process, of a thickness greater 
than 8 .5 mm, or  
— sanded, of a thickness greater 
than 18 .5 mm  650,000 m3  0% 650,000 m3  100%  
Council Regulation 
(EC) No . 32/2000  
4801 00 00  Newsprint  650,000 t 0% Not used  0% Council Regulation 
(EC) No . 32/2000  
5306 10 10  
5306 10 30  Unbleached flax yarn (other than 
tow yarn) measuring 333 .3 decitex 
or more (not exceeding 30 metric 
number)  400 t  1.8% 0 0% 
Council Regulation 
(EC) No . 32/2000  
7018 10 90  Glass beads, imitation precious and 
semi-precious stones and similar 
glass smallwares  52 t 0% 16 t 31% Council Regulation 
(EC) No . 32/2000  
7202 21 00  
7202 29 10  
7202 29 90  
 Ferro-silicon  12,600 t  0% 12,600 t  100%  Council Regulation (EC) 
No. 32/2000  
7202 30 00  Ferro-silico-manganese  18,550 t  0% 18,550 t  100%  Council Regulation (EC) 
No. 32/2000  
7202 49 10  
7202 49 50  Ferro-chromium containing not 
more than 0 .10% by weight of 
carbon, and more than 30% but 
not more than 90% of chromium  2,950 t  0% 2,950 t 100%  Council Regulation (EC) 
No. 32/2000  
Source:  WTO document WT/Let/1220, 14 December 2016; and i nformation provided by the authorities .  WT/TPR/S/395 • European Union  
 
- 286 - 
 
  Table A3. 2 Excise duties other than on EU harmonized products, by member State, 2020  
 Product  Rate Source  
Austria  None   
Belgium  Non-alcoholic beverages 
and coffee  
Environmental levy  
Packaging fee  EUR 0 -71.54/hl  
 
EUR 2.70 -4.50/kg  
EUR 9.86 or EUR 1.41/hl  http://finances.belgium.be/fr/ent
reprises/accises  
Bulgaria  None   
Croatia  Coffee  
Non-alcoholic beverages  
Motor vehicles  HRK 6 -20/kg  
HRK 40 -240/hl  
Varies by engine size, price, 
etc. http://www.ijf.hr/upload/files/file
/ENG/taxtable.pdf  
Cyprus  Cars 
Double cabin vehicles  
Other vehicles  
Motorcycles  
Smoked salmon and 
sturgeon  
Caviar  
Crystal  
Chinaware  From EUR 0 to EUR 2,250  
EUR 0.26/c.c.  
15% 
EUR 1.71 or EUR 2.56/c.c.  
 
EUR 5.13/kg  
30% 
20% 
20% http://www.mof.gov.cy/mof/cust
oms/customs.nsf/All/A2C3593B5
465A799422577D6002FEAC4?Op
enDocument  
Czech 
Republic  None   
Denmark  Ice cream  
Chocolate & confections  
Coffee and tea  
Incandescent lamps and 
electrical fuses  
Cigarette paper  
Coal 
 
Landfill  
Hazardous waste  
Packaging  
Piped water  
Sulphur  
Nitrous oxides  
Tyres  
Pesticides  
 
Chlorinated solvents  
Batteries  
 
Motor vehicles  
Gaming  
Insurance  DKK 5.58 to DKK 6.98 per 
litre 
DKK 11.04 to DKK 25.97 per 
kg 
DKK 0.75 to DKK 18.29 per 
kg 
 
DKK 0.59 to DKK 8.79 per 
piece 
DKK 5 per piece  
DKK 1,068 to DKK 2,113 per 
tonne  
DKK 475 per tonne  
DKK 160 per tonne  
Varies by type  
DKK 6.25 per m3 
DKK 23.3 per kg  
DKK 11.7 per kg  
DKK 5 to DKK 225 per piece  
DKK 107 per kg or litre per 
agent  
DKK 2 per kg  
DKK 6 to DKK 120 per kg or 
package  
Varies by type  
Varies by game  
1.1%  http://www.skat.dk/SKAT.aspx?o
Id=1921338  
Estonia  Packaging (glass, 
plastic, metal, paper, 
cardboard, wood)  From EUR 0.6 to EUR 2.5 per 
kg, depending on type  https://www.emta.ee/eng/busine
ss-client/excise -duties -assets -
gambling/about -excise -
duties/rates -excise -duty  
Finland  Sweets, ice cream and 
soft drinks  
Beverage containers  
Oil waste  
Oil protection  
Landfill  Range from EUR 0.12 per 
litre to EUR 1.72 per kg  
EUR 0.51 per litre  
EUR 0.0575 per kg  
EUR 0.50 per tonne  
EUR 70 per tonne  https://www.vero.fi/en/businesse
s-and-corporations/about -
corporate -taxes/excise_taxes/   
France  Non-alcoholic beverages  From EUR 0.54 to EUR  3.03 
per hl  http://www.douane.gouv.fr/articl
es/a12186 -tarifs-2016-droits -
des-alcools -boissons -alcooliques -
et-non-alcooliques  WT/TPR/S/395 • European Union  
 
- 287 - 
 
   Product  Rate Source  
Germany  Coffee  
Coffee products  
Nuclear fuel  
Biofuels  EUR 2.19 to EUR 4.78 per kg  
EUR 0.12 to EUR 3.83 per kg  
EUR 145 per g  
Quota system  http://www.zoll.de/DE/Facht hem
en/Steuern/Verbrauchsteuern/ve
rbrauchsteuern_node.html  
Greece  Electronic cigarette 
refills  
Coffee  
Instant coffee and coffee 
containing products   
EUR 0.10 per ml  
EUR 2 to EUR 3 per kg  
 
EUR 4 per kg  https://www2.deloitte.com/conte
nt/dam/Deloitte/gr/Documents/t
ax/gr_indirect_tax_customs_leg_
43892016_en_noexp.pdf   
Hungary  None   
Ireland  Betting  
Sweetened drinks  2%-25% 
EUR 16.26 to EUR 24.39 per 
hl http://www.revenue.ie/en/tax/ex
cise/duties/excise -duty-
rates.html  
Italy Nitrogen oxide 
emissions  
Sulphur emissions  
Lubricating oils  
Bitumen oil   
EUR 209.00 per tonne/year  
EUR 106.00 per tonne/year  
EUR 787.81 per 1,000 kg  
EUR 30.99 per 1,000 kg  https://www.agenziadoganemon
opoli.gov.it/portale/documents/2
0182/889198/Aliquo te+nazionali
+aggiornamento+al+1+gennaio
+2015.pdf/9109f7b8 -985a-4837-
b0e0-ac09fdbbc77e  
Latvia  Non-alcoholic beverages  
Coffee  EUR 7.4 per 100 litres  
EUR 142.29 per 100 kg  http://www.fm.gov.lv/en/s/taxes
/excise_duty/  
Lithuania  Coal 
Coke and lignite  EUR 3.77 to EUR 7.53 per 
tonne  
EUR 4.63 to EUR 8.98 per 
tonne  https://finmin.lrv.lt/en/competen
ce-areas/taxation/main -
taxes/excise -duties  
Luxembourg  None   
Malta  Non-alcoholic beverages  
Plastic bags, CN 3923  
Toilet waters, CN 3303  
Make-up, CN 3304  
Hair products, CN 3305  
Shampoo, CN 330510  
Personal hygiene 
products, 3307  
Aftershave, deodorizers, 
3307 
Shower gel, 3401  
Prefabricated concrete 
structures, CN 681091  
Ceramic tiles, CN 6907, 
6908 
Glass sheets, CN 7005  
Iron bars, CN 7213  
Iron rods, CN 721310  
Iron bars, CN 72139110, 
72139149, 72142000  
Iron beams, CN 7216  
Wire mesh, CN 
73142010, 73142090 
and 73143900  EUR 400 per 1,000 litres  
EUR 425 per 100 kg  
EUR 220 per 100 litres  
EUR 50 per 100 litres/kg  
EUR 50 per 100 litres/kg  
EUR 3 per 100 litres  
 
EUR 3 per 100 litres/kg  
 
EUR 50 per 100 litres/kg  
EUR 3 per 100 litres/kg  
 
EUR 25.60 per 1,000 kg  
 
EUR 7.50 per 1,000 kg  
EUR 16 per 1,000 kg  
EUR 30 per 1,000 kg  
EUR 5 per 1,000 kg  
 
EUR 15 per 1,000 kg  
EUR 50 per 1,000 kg  
 
 
EUR 30 per 1,000 kg  https://customs.gov.mt/docs/def
ault-source/rates -of-
exchange/Rates -of-Exchange -
2016/learn -more.pdf?sfvrsn=0  
Netherlands  Non-alcoholic  drinks  EUR 8.83 per hl  https://www.government.nl/topic
s/excise -duty/contents/excisable -
products  
http://download.belastingdienst.
nl/douane/docs/tarievenlijst_accij
ns_acc0552z72fol.pdf  
Poland  Cars 3.1% or 18.6%  http://www.finanse.mf.gov.pl/in/
excise -duty/basic -information  
Portugal  Motor vehicles  
Plastic bags  .. .. WT/TPR/S/395 • European Union  
 
- 288 - 
 
   Product  Rate Source  
Romania  Green coffee  
Roasted coffee  
Soluble coffee  
Natural fur products  
Articles from crystal  
Jewelleries from gold 
and/or platinum  
Cars 
Perfume products  
Microwave ovens  
Air conditioning units  
Hunting and other guns  
Yachts and boats  EUR 680 per tonne  
EUR 1,000 per tonne  
EUR 4 per kg  
45% 
55% 
 
25% 
EUR 1 per cm3 
10%-35% 
20% 
20% 
100%  
30%-50% http://www.aneir -
cpce.ro/chapter5/excise1.htm  
Slovak 
Republic  Coal 
Natural gas  
 
Compressed natural gas  EUR 10.62 per tonne  
EUR 1.32 to EUR 9.36 per 
MWh 
EUR 0.141 to EUR  0.01989 
per kg  https://www.financnasprava.sk/e
n/individuals/taxes -
individuals/excise -duties  
Slovenia  None   
Spain  None https://www.agenciatributaria.es
/AEAT.internet/en_gb/Inicio/La_A
gencia_Tributaria/Aduanas_e_Im
puestos_Especiales/_Presentacio
n/Impuestos_especiales/Impuest
os_especiales.shtml   
Sweden  Advertising  
Waste (landfills)  
Pesticides  
 
Gravel  
Lottery  
Gaming  
 
 
Profits (monetary gains)  
Automobile insurance  8%, 3% for periodicals  
SEK 500 per tonne  
SEK 34 per kg active 
ingredient  
SEK 15 per tonne  
35% 
Varies by number of tables 
(SEK 2,000 -SEK 25,000)  
30% 
32% http://www.skatteverket.se/foret
agochorganisationer/skatter/pun
ktskatter.4.71004e4c133e23bf6d
b800057013.html  
United 
Kingdom  Betting  
Vehicles  
Biofuels  
Climate change  10%-50%, varies by game  
GBP 0 -GBP 2,000, varies  
GBP 0.5795 per litre  
GBP 0.00195 to 
GBP 0.00559 per kWh or 
GBP 0.01251 to 
GBP 0.01526 per kg, 
depending on commodity  https://www.gov.uk/government
/publications/uk -trade -tariff-
excise -duties -reliefs -drawbacks -
and-allowances/uk -trade-tariff-
excise -duties -reliefs -drawbacks -
and-allowances#introduction  
https://www.gov.uk/government
/publications/rates -and-
allowance -excise -duty-gambling -
duty/excise -duty-gambling -duty-
rates#gambling -duties  
https://www.gov.uk/government
/publications/vehicle -excise -
duty/vehicle -excise -duty 
.. Not available.  
Source:  As noted in the table.  
 WT/TPR/S/395 • European Union  
 
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  Table A3. 3 Indicative list of export -credit agencies or guarantee schemes, as at 
September 2019  
Member 
State  Agency  Overview  Link 
Austria  Oesterreichische 
Kontrollbank AG  (OeKB)  Provides g uarantees of the 
Republic of Austria  
under the Export Financing 
Guarantees Act  and the 
Export Guarantees Act  https://www.oekb.at/en/exp
ort-services/about -oekb-
export -services.html   
Belgium Crenendo  Credendo – export-credit 
agency  offers credit 
insurance , investment 
insurance , financial 
guarantees , and d irect 
financing  https://www.credendo.com   
Bulgaria  Bulgarian Export Insurance 
Agency (BAEZ)  BAEZ provides insurance 
against export risks under 
the Export Insurance Act and 
under the Insurance Code  https://baez.bg  
Croatia  Croatian Bank for 
Reconstruction and 
Development (HBOR)  HBOR provides export -credit 
insurance according to the  
Act on the Croatian Bank for 
Reconstruction and 
Development  https://www.hbor.hr  
Cyprus  No information available  
Czech 
Republic Export Guarantee and 
Insurance Corporation  
(EGAP)  and Czech Export 
Bank Insurance against  political 
and commercial risks related 
to the financing export of 
goods, services and 
investments  http://www.egap.cz  
http://www.ceb.cz   
Denmark  Eksport Kredit Fonden (EKF)  Denmark's official export -
credit agency for financing of 
export projects  http://www.ekf.dk  
 
Estonia  KredEx  KredEx helps enterprises 
develop faster  and expand 
more safely in foreign 
markets, of fering loans, 
venture capital, credit 
insurance and guarantees 
with state guarantee  http://kredex.ee/en/   
Finland  Finnvera and Finnish Export -
Credit Ltd (FEC ) Covers credit risks in export 
trade, working capital for 
export products, export 
credits, cash for export 
receivables, financing for the 
buyer, and export -credit 
guarantees  http://www.finnvera.fi   
http://www.fec.fi   
France  Bpifrance Assura nce Export  Facilitates exports, provides 
export insurance and 
guarantees  http://www.bpifrance.fr/Qui -
sommes -
nous/Nosmetiers/Internation
al2/Assurance -Export   
Germany  Euler Hermes 
Aktiengesellschaft  Provides export -credit 
guarantees a s a key foreign 
trade promotion instrument 
of the Government  https://eulerhermes.com  
Greece  Export -Credit Insurance 
Organisation (ECIO)  Offers short - and long -term 
export credits, export -credit 
insurance, and foreign 
investment insurance  http://www.ecio.gr   WT/TPR/S/395 • European Union  
 
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  Member 
State  Agency  Overview  Link 
Hungary  Hungarian Export -Credit 
Insurance Ltd  
(MEHIB) and Hungarian 
Export -Import Bank plc  
(EXIM)  EXIM offers financing for 
buyers, discounting facilities, 
and guarantee commitments  http://www.exim.hu/en/   
Ireland  Credit Gua rantee Scheme  The Credit Guarantee 
Scheme is provided only to 
SMEs  https://dbei.gov.ie/en/Public
ations/Publication -files/SME -
CGS-Information -Booklet.pdf   
Italy Servizi Assicurativi del 
Commercio Estero  
(SACE)  Offers financing solutions to 
purchase Italian goods and 
services  http://www.sace.it/  
Latvia  Latvian Guarantee Agency 
(LVA) and Export -Credit 
Agency (ECA)  LVA and ECA are run by 
ALTUM , a state -owned 
development finance 
institution  which offers loans, 
guarantees, and venture 
capital. It also develops and 
implements state aid 
programmes  https://www. altum.lv/en/   
Lithuania  INVEGA  National promotional 
institution providing 
guarantees on export to non -
marketable risk countries  http://invega.lt  
 
Luxembourg  Office du Ducroire (ODL)  Provides insurance and 
financial support to eligible 
companies  http://www.ducroire.lu   
Malta  No information available  
Netherlands  Export -credit guarantee 
scheme  Initiated in 2009, the export -
credit guarantee scheme 
promotes the export of 
Dutch capital goods. Banks 
can take out export -credit 
insurance (EKV) with the 
State of the Netherlands  https://www.government.nl/
topics/export -import -and-
customs/export -credit -
insurance -eci 
 
http://atradius.com/nl/en/du
tchstatebusiness/index.jsp   
Poland  Korporacja Ubezpieczén 
Kredytów  
Eksportowych (KUKE)  KUKE provides insurance 
services for both domestic 
and export transactions to 
facilitate trade and financing  http://www.kuke.com.pl   
Portugal  Companhia de Seguro de 
Créditos  Offers state gua rantees for 
short-term export cre dits, 
supplier and buyer credit 
cover, and other covered 
risks http://www.cosec.pt   
Romania  EximBank Romania  EximBank Romania provides 
export -credit insurance  https://www.eximbank.ro/  
 
Slovak  
Republic  Export -Import Bank of the 
Slovak Republic  
(Eximbanka SR)  Provides export insurance, 
export financing, bank  
guarantees, and concessional 
loans.  http://www.eximbanka.sk   
Slovenia  Slovenska izvozna in 
razvojna banka, d.d.  
(SID)  As an authorized export -
credit agency, SID provides 
insurance for international 
commercial transactions 
against non -marketable risks 
on behalf of the Republic  http://www.sid.si/ho me  WT/TPR/S/395 • European Union  
 
- 291 - 
 
  Member 
State  Agency  Overview  Link 
Spain  Compañía Española de 
Seguros de Crédito a la 
Exportación (CESCE)  CESCE manages export -
credit insurance on behalf of 
Spain  http://www.cesce.es   
Sweden  Swedish Export Credit (SEK) 
and the Export -Credit 
Committee (EKN)  SEK helps finance Swedish 
exports by providing long -
term funding, and EKN offers 
state supported export 
credits  https://www.sek.se  
https://www.ekn.se  
 
United 
Kingdom  UK Export Finance  The United Kingdom' s 
export -credit agency  and 
government department 
offering export insurance, 
direct lending, letters of 
credit, investment insurance, 
etc. https://www.gov.uk/govern
ment/organisations/uk -
export -finance  
Source:  Compiled from the various websites listed.  
  WT/TPR/S/395 • European Union  
 
- 292 - 
 
  Table A3. 4 SOEs  
Country  Definition of SOE 
by the member 
State providing 
statistics  Main responsible 
government institutions  No. of SOEs 
(year) 
(indicative)  References  
Austria  All companies in 
which the federal 
Government has a 
direct or majority 
interest (over 50% 
equity)  The Federal Ministry of 
Finance under the terms of 
the Austrian Federal 
Ministries Act  100 (2018)  https://english.bmf.gv.
at/budget -economic -
policy/Management -of-
State -Owned -
Enterprises.html ; 
https://www.bmf.gv.at
/budget/das -
budget/Beteiligungen_
des_Bundes_Maerz_20
18.pdf?6dj8e5  
Belgium  Federal Government 
as shareholder, 
investor, or equity 
stakeholder  The Federal Holding and 
Investment Company (SFPI -
FPIM) manages the federal 
Government's shareholdings 
and cooperates with the 
Government on specific 
projects pursuant to the 
interests of the Belgian 
economy. The federal 
Government is the sole 
shareholder of SFPI -FPIM. 
Five companies designated as 
"autonomous public 
enterprises" (SNCB, Infrabel, 
Belgocontrol, bPost, and 
Proximus) are overseen by 
the Governmenta 93 (2017)  http://www.sfpi -
fpim.be/fr ; 
http://www.sfpi -
fpim.be/sites/default/fi
les/attachments/sfpi_r
a2017_web.pdf  
Bulgaria  State enterprises and 
commercial 
companies with at 
least 50% 
participation by the 
state. Regulated by 
both commercial law 
and public law  Some SOEs are owned by the 
central Government, others 
by local governments. The 
Ministry of Finance is the 
body responsible for strategic 
decisions on financial assets. 
Ministries,  central and local 
public authorities, and other 
bodies owning a majority 
stake in public sector 
holdings are responsible for 
operational decisions  Over 900 at 
national and 
local level (of 
which 220 under 
Central 
Government) 
(2017)  https://www.minfin.bg
/bg/948 ; 
http://www.statecaptu
re.eu/wp -
content/uploads/2018/
01/BG_c.pdf ; 
https://ec.europa.eu/i
nfo/sites/info/files/201
9-european -semester -
country -report -
bulgaria_en.pdf ; and 
information provided 
by the authorities  
Croatia Companies majority -
owned and controlled 
by the government; 
companies and legal 
entities of strategic 
importance to 
Croatia; companies 
where Croatia has a 
minority share but a 
special interest  The State Property Ministry; 
and the Ministry of Finance  1,149 
enterprises 
majority -owned 
by the state (as 
at 2016). 
Among these, 
49 are classified 
as being of 
special state 
interest  http://www.ijf.hr/uploa
d/files/file/ENG/FISCU
S/5.pdf  
Cyprus  A company, 
association or 
institution in which 
the government may 
exercise decisive 
influence, with the 
exception of listed 
companies on a 
regulated market. 
The decisive 
influence on the part 
of the government 
shall be presumed 
when the The government has stakes 
in 13 firms, almost all of 
which are owned by the 
central Government.  
The main body in charge of 
strategic decisions regarding 
financial assets owned by the 
central Government is the 
Council of Ministers. 
Ministr ies, central and local 
public authorities, as well as 
other bodies owning a 
majority stake in SOEs, are 12 majority -
owned by the 
state (>50%); 
1 minority -
owned 
(10% -50%) 
(2015)  Information provided 
by the authorities  WT/TPR/S/395 • European Union  
 
- 293 - 
 
  Country  Definition of SOE 
by the member 
State providing 
statistics  Main responsible 
government institutions  No. of SOEs 
(year) 
(indicative)  References  
government, directly 
or indirectly:  
(a) holds the 
majority of the 
issued capital of a 
company, or  
(b) holds the 
majority of the votes 
attached to shares 
issued by the 
company, or  
(c) can appoint more 
than half the 
members of the 
administrative, 
management or 
supervisory body  responsible for operational 
decisions  
Czech Rep.  Equity investments 
by the Ministry of 
Finance in 
companies. Joint -
stock companies 
controlled by the 
Ministry of Finance, 
with a share of 40% -
100%.  The Ministry of Finance in the 
case of joint -stock 
companies; the Ministry of 
Industry and Trade i n the 
case of statutory 
corporationsa 61 (of which 
19 joint-stock 
companies) 
(2018)  https://www.mfcr.cz/c
s/verejny -
sektor/majetek -
statu/majetkove -ucasti  
Denmark  Stakeholder in joint -
stock companies, 
public companies, or 
international or 
investment funds 
(majority and 
minority 
state-owned)  The Ministry of Finance 
exercises ownership functions 
for the majority of SOEs, but 
several line ministries also 
exercise owner shipa 29 (2017)  https://www.fm.dk/arb
ejdsomraader/statens -
selskaber ;  
https://www.fm.dk/pu
blikationer/2018/state
ns-selskaber -2018 
Estonia  State as sole owner 
or having an 
exclusive or majority 
stake; for non -
profits, where the 
Government 
exercises rights as an 
appointed member  Basic ownership functions 
and governance on SOEs are 
divided between seven 
ministries. The Ministry of 
Finance controls ownership 
rights of SOEs under its 
control, and appoints half of 
the board members of SOEs 
governed by other ministriesa 29 private 
companies, 
49 foundations  
(as at 
September  
2019)  https://www.eesti.ee/e
ng/contacts/riigi_osalu
sega_ariuhingud_1  
Finland  A state majority -
owned company is 
one in which the 
State holds the 
majority of the 
aggregate of votes; a 
state associated 
company is one in 
which the State holds 
a minimum of 10% 
and a maximum of 
50% of the 
aggregate votes  The Ownership Steering 
Department of the Prime 
Minister's Office is 
responsible for preparing and 
implementing ownership 
policies. It prepar es and 
implements state ownership 
policy, and exercises 
ownership steering in 
companies. Responsibility for 
ownership steering in respect 
of special -assignment 
companies rests mostly with 
other ministries  50 (2018)  https://vnk.fi/en/owne
rship-policy -and-
steering ; 
https://julkaisut.valtio
neuvos to.fi/bitstream/
handle/10024/161720/
Report_on_State_Annu
al_Accounts_2018_Ann
ex_4.pdf?sequence=1
&isAllowed=y   
France  List of companies per 
Decree No.  2004-963 
of 9 September 2004 
on the establishment 
of the national -
owned service. Plus, 
shareholdings in 
companies in which 
the Government L'Agence des participations 
de l'État (APE), as a part of 
the Ministry of Economy and 
Finance and under the 
responsibility of all ministries. 
It has a portfolio of 88 
strategic and centrally -owned 
public sector holdings. The 
APE centralizes the 88 (2018)  https://www.legifrance
.gouv.fr/affichTexte.do
?cidTexte=JORFTEXT0
00000440880&categori
eLien=cid ; 
https://www.economie
.gouv.fr/agence -
participations -etat/Les -WT/TPR/S/395 • European Union  
 
- 294 - 
 
  Country  Definition of SOE 
by the member 
State providing 
statistics  Main responsible 
government institutions  No. of SOEs 
(year) 
(indicative)  References  
holds less than 1% of 
the capital  shareholding responsibilities 
with respect to numerous 
companies subject to whole 
or partial ownership by the 
State. Every October, it 
submits a report on the 
economic situation of 
majority -owned publi c sector 
holdings to Parliament  participations -
publiques ;  
https://www.economie
.gouv.fr/files/2019 -
10/COR_021019_RA_A
PE-web.pdf ; 
https://ec.europa.eu/i
nfo/sites/info/files/eco
nomy -
finance/dp089_en_p ub
lic_assets.pdf   
Germany  Where the federal 
Government has a 
direct or indirect 
investment of 25% 
or EUR 50,000 
capital; for others, 
where the 
Government has 
more than 50% of 
the capital or voting 
rights  The framework for managing 
state holdings is set ou t by 
the Finance Ministry. It is 
undertaken by the individual 
government 
departments/ministries 
according to their 
responsibility.a 553 (Federal) 
(2017)  https://www.bundesfin
anzministerium.de/Con
tent/DE/Downloads/Br
oschueren_Bestellservi
ce/2019 -05-23-
beteiligungsbericht -
des-bundes -
2018.pdf?__blob=publi
cationFile&v=2   
Greece  SOEs defined by law  Public Holdings Company 
(HCAP -EDIS) manages SOEs 
as part of Hellenic 
Corporation of Assets and 
Participations (HCAP)   29 under 
Chapter A of 
Law 342/2005 
and 57  of the 
general 
government with 
a budget over 
EUR 10 million 
(2018)  http://www.hcap.gr/en
/; 
https://ec.europa.eu/i
nfo/sites/info/files/eco
nomy -
finance/ip064_en.pdf ; 
https://www.minfin.gr/
web/guest/d.e.k.o  
Hungary  State -owned 
business enterprises 
in which it has a 
majority or minority 
owners hip or 
exercises ownership 
rights  Hungarian National Asset 
Management Inc. (MNV Zrt.) 
is entrusted to exercise 
ownership rights in terms of 
all state assets, unless a law 
or ministerial order provides 
otherwise  Over 350 (as at 
September 
2019)  http://www.mnvzrt.hu
/en  
Ireland  State -sponsored 
bodies are financial 
and non -financial 
bodies that are 
directly or indirectly 
controlled by a 
government office, or 
lack autonomy  The minister and/or the 
department has statutory 
responsibility for each state -
sponsored body  81 majority -
owned by the 
state (>50%), 
62 minority -
owned (10% -
50%) (2015)  https://www.go v.ie/en
/publication/0918ef -
code-of-practice -for-
the-governance -of-
state-bodies/ ; and 
information provided 
by the authorities.  
Italy For the Department 
of Treasury under 
the Ministry of 
Economy and 
Finance (MEF), listed 
and non -listed 
companies where the 
state has majority or 
controlling 
shareholding; the 
total is companies 
where there is public 
participation  The MEF and individual line 
ministries share the 
ownership function. For 
example, the Agenzia del 
Demanio (AdD), the Italian 
Public Property Agency, is 
responsible for the 
management, rationalization 
and development of all state -
owned properties; AdD's 
operations are overseen by 
the MEF  30 under the 
MEF (2019)  
9,240 in total 
(general 
government)  
(2016)  http://www.dt.mef.gov
.it/en/attivita_istituzio
nali/partecipazioni/elen
co_partecipazioni/ ; 
https://www.istat.it/en
/archivio/225442 ; 
https://ec.europa.eu/i
nfo/sites/info/files/eco
nomy -
finance/dp089_en_pub
lic_assets.pdf   
Latvia  SOEs, state -owned 
equity shares, equity 
shares belonging to 
the SOEs, and SOEs 
effectively controlled 
by the State  From 1 June 2015, SOE 
operational and strategic 
governance is implemented 
through the Cross -Sectoral 
Coordination Centre and 
sectoral ministries  182 enterprises 
(2017)  https://www.pkc.gov.l
v/en/state -owned -
enterprises ; 
http://www.valstskapit
als.gov.lv/images/user
files/parskats_web_pa
2.pdf; WT/TPR/S/395 • European Union  
 
- 295 - 
 
  Country  Definition of SOE 
by the member 
State providing 
statistics  Main responsible 
government institutions  No. of SOEs 
(year) 
(indicative)  References  
http://www.valstskapit
als.gov.lv/images/user
files/SOE_Review_LV_
_Final_report.pdf   
Lithuania  State as full or 
majority -share owner 
(more than 50% of 
all votes at the 
general meeting of 
the company). SOE 
engaged in 
commercial activities, 
public limited liab ility 
companies and 
private limited 
companies.  The Governance Coordination 
Centre is a centralized 
managing state property 
manager which is the 
responsible coordinating 
institution for the 
implementation of SOE 
management policy. 
Lithuanian SOEs often 
perform both commercial 
activities and special 
activities and functions 
assigned by the Government, 
according to standards issued 
by the Ministry of Economy  108 (2017)  https://vkc.sipa.lt/wp -
content/uploads/2018/
09/SOE_Report_2018_
EN_WEB.pdf  
Luxembourg  Direct state holdings 
in private companies 
(both listed and non -
listed); institutions, 
foundations, and 
economic interest 
groups; or 
international financial 
institutions  Some SOEs are owned by the 
central Government, others 
by local governments. The 
main body for strategic 
decisions is the Ministry of 
Finance, through the 
Treasury Department. It is 
also responsible for managing 
the financial assets in the 
Government's equity  portfolio  45 (as at 
31 August  2019)  https://te.public.lu/fr/p
articipations.html  ; and 
information provided 
by the authorities.  
Malta  The portfolio of 
investments held by 
Government  Malta Investment 
Management Company 
Limited provides consultancy 
and advice to SOEs. It falls 
under the responsibility of 
the Ministry for the Economy, 
Investment and Small 
Business  17 companies 
under Malta 
Government 
Investments  https://mgismalta.com
/portfolio -2/; 
http://mimcol.com.mt/
; and information 
provided by the 
authorities.  
Netherlands  Where the Dutch 
State owns shares  In 2001, the Netherlands 
centralized the management 
of state participations with 
the Ministry of Financea 14 (2017)  https://www.rijksoverh
eid.nl/documenten/ka
merstukk en/2019/06/2
5/bijlage -jaarverslag -
beheer -
staatsdeelnemingen -
2018; 
https://english.rekenk
amer.nl/publications/re
ports/2015/04/07/the -
state-as-public-
shareholder  
Poland  Where the state 
treasury holds a 
majority or minority 
interest  The Ministry of Treasury is 
responsible for ownership 
functions for the majority of 
SOEs, but several sector 
ministries also exercise 
ownership for SOEs with 
public policy objectivesa Several hundred 
companies in 
public ownership 
(of which, 30 
SOEs considered 
as being of 
strategic 
importance 
under Ministry of 
Treasury special 
surveillance) 
(2014)  https://ec.europa.eu/i
nfo/sites/info/files/201
7-european -semester -
country -report -poland -
en.pdf   
Portugal  Companies in which 
the State can directly 
or indirectly exercise 
a dominant influence  The General Directorate of 
the Treasury and Finance 
plays a role in ensuring the 
effectiveness of the 
operations of financial 121 (2018)  http://www.dgtf.pt/Ho
mepage ; 
http://www.dgtf.pt/sec
tor-empresarial -do-
estado -see/o -que-e-o-WT/TPR/S/395 • European Union  
 
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  Country  Definition of SOE 
by the member 
State providing 
statistics  Main responsible 
government institutions  No. of SOEs 
(year) 
(indicative)  References  
intervention of the State with 
respect to the management 
of the State's assets  sector -empresarial -do-
estado -see-  
Romania  Compa nies in which 
the state or 
administrative 
territory are sole 
shareholders or have 
a participation rate 
that provides control; 
where the state has 
guardianship; or 
where the state 
exercises control in 
terms of voting 
rights, members of 
the management, or 
influence by clause, 
contract or 
association  Some S OEs are owned by the 
central Government, others 
by local governments. There 
is no unique body responsible 
for strategic and investment 
decisions regarding financial 
assets. In fact, each Ministry 
is responsi ble for the 
decisions related to public 
sector holdings (PSHs) 
operating in the fields under 
its jurisdiction and, in 
addition, the Ministry of 
Public Finance is responsible 
for supervising and 
monitoring PSH activities  385 central and 
1,402  local 
(2018)  http://discutii.mfinante
.ro/static/10/Mfp/guve
rnanta/rapactivintrepp
ub2018_120920198.pd
f; and information 
provided by the 
authorities.  
Slovak 
Republic  Majority or minority 
ownership by the 
state Some SOEs are owned by the 
central Government, others 
by local government. The 
main body for strategic 
decisions is the Ministry of 
Finance, which is res ponsible 
for strategic decisions around 
financial assets owned by the 
central Government. 
Ministries, central and local 
public authorities, and other 
bodies owning a majority 
stake in PSHs are responsible 
for operational decisions. 
Currently, many of the 
financial assets are owned by 
MH Manažment, which is an 
SOE fully owned by the 
Slovak Ministry of Economy. 
It is the legal successor to 
the National Property Fund of 
the Slovak Republic, and its 
main aim is to exercise the 
State's shareholder rights in 
comp anies assigned to it  65 SOEs under 
11 ministries 
and 
two government
al agencies 
(2015)  https://en.llri.lt/wp -
content/uploads/2018/
01/SOE -in-CEE.pdf ; 
and information 
provided by the  
authorities  
Slovenia  Direct and indirect 
holdings of the 
Republic of Slovenia  The Slovenian Sovereign 
Holding manages direct or 
indirect holdings owned by 
the State  84 (as at 
30 June 2019)  https://www.sdh.si/en
-gb/ 
Spain  State majority or 
minority 
shareholdings in 
companies; and 
indirect 
shareholdings. Public 
companies where the 
public administration 
has the capacity to 
control the policy  The Ministry of Finance and 
Public Administrations 
exercises ownership functions 
for the majority of SO Es, but 
several line ministries also 
exercise ownershipa 15 (majority), 9 
(minority), plus 
indirect in over 
100 
(as at 
September 
2019)  http://www.sepi.es/en
/get-know -sepi/who -
we-are  
Sweden  State wholly -owned 
and partially -owned 
companies actively 
managed by the 
Government. SOEs 
are primarily 
governed by the The Minister for Enterprise 
and Innovation is respon sible 
for a unified ownership policy 
for SOEs. Other responsible 
ministries include: Ministry of 
Finance, Ministry of Culture, 
Ministry of Health and Social 47 (2017)  https://www.governme
nt.se/reports/2018/09/
annual -report -for-
state-owned -
enterprises -2017/  WT/TPR/S/395 • European Union  
 
- 297 - 
 
  Country  Definition of SOE 
by the member 
State providing 
statistics  Main responsible 
government institutions  No. of SOEs 
(year) 
(indicative)  References  
Swedish Companies 
Act, supported by the 
Swedish Code of 
Corporate 
Governance  Affairs, and Ministry for 
Foreign Affairs  
United 
Kingdom  Companies in 
government include 
private limite d, 
unlimited, 
community -interest 
companies, royal 
charters, statutory 
entities, trading 
funds, registered 
societies, and 
industrial and 
provident societies. 
Public corporations 
refer to market 
entities that are 
controlled by central 
or local governments 
and derive more than 
50% of production 
costs from the sale of 
goods or services at 
economically 
significant prices. 
The public sector can 
set up and own 
companies in the 
same way as the 
private sector. 
Depending on 
circumstances (e.g. 
financial crisis), the 
government can 
directly buy existing 
companies  Some SOEs are owned by the 
central Government, others 
by the local governments. 
The main bodies involved in 
strategic decisions regarding 
financial assets are (i) the 
central and local 
governments, which are 
responsible for decisions 
related to the 
dismission/acquisition of their 
stakes in companies; and (ii) 
HM Treasury, which is 
responsible for monitoring 
the performance of PSHs and 
of the government policy on 
privatization  303 companies 
that are jointly -, 
majority - or 
fully-owned by 
the public sector 
(i.e. with direct 
shareholding by 
the public sector 
of at least 50%) 
(2017)  https://researchbriefin
gs.files.parliament .uk/
documents/CBP -
8325/CBP -8325.pdf ; 
https://www.nao.org.u
k/wp-
content/uploads/2015/
12/Companies -in-
Government_updated.
pdf; and information 
provided by th e 
authorities.  
a Information taken from OECD (2018), Ownership and Governance of State -Owned Enterprises: A 
Compendium of National Practices . 
Source:  Information compiled by the WTO Secretariat from sources listed in the table ; WTO document 
WT/TPR/S/357/Rev.1, 13 October 2017, Table A3.5; OECD (2018), Ownership and Governance of 
State -Owned Enterprises: A Compendium of National Practices ; and information provided by the 
authorities.  
  WT/TPR/S/395 • European Union  
 
- 298 - 
 
  Table A3. 5 Summ ary of main legislative measures on IPRs, 2019  
Legislative measure  Notification to Council 
for TRIPS pursuant to 
Article  63.2 TRIPS  
Copyright and Related Rights   
Directive 93/83/EEC  of 27 September 1993 on the coordination of certain rules 
concerning copyright and rights related to copyright applicable to satellite 
broadcasting and cable retransmission . IP/N/1/EU/C/5  
 
Directive 96/9/EC of 11 March 1996 on the legal protection of dat abases . IP/N/1/EEC/C/2  
 
Council Decision 2000/278/EC of 16 March 2000 on the approval, on behalf of 
the European Community, of the WIPO Copyright Treaty and the WIPO 
Performances and Phonograms Treaty . IP/N/1/EU/C/8  
 
Directive 2001/29/EC  of 22 May 2001 on the harmonization of certain aspects of 
copyright and related rights in the information society (Information Society 
Directive)  IP/N/1/EU/C/1  
Directive 2001/84/EC  of 27 September 2001 on the resale right for the benefit 
of the author of an original work of art . IP/N/1/EU/C/6  
 
Directive 2006/115/EC  of 12 December 2006 on rental right and lending right 
and on certain rights related to copyright in the field of intellectual property . IP/N/1/EU/C/3  
 
Directive 200 6/116/EC of 12 December 2006 on the term of protection of 
copyright and certain related rights . IP/N/1/EU/C/10  
 
Directive 2009/24/EC of 23 April 2009 on the legal protection of computer 
programs . IP/N/1/EU/C/7  
 
Directive 2011/77/EU of 27 September 2011 a mending Directive 2006/116/EC 
of 12 December  2006 on the term of protection of copyright and certain related 
rights . IP/N/1/EU/C/4  
 
Directive 2012/28/EU of 25 October 2012 on certain permitted uses of orphan 
works . IP/N/1/EU/C/2  
 
Directive 2014/26/EU of 26 February 2014 on collective management of 
copyright and related rights and multi -territorial licensing of rights in musical 
works for online use in the internal market . IP/N/1/EU/C/9  
 
Regulation (EU) 2017/1128 of 14 June 2017 on cross-border portability of online 
content services in the internal market . IP/N/1/EU/C/11  
 
Directive (EU) 2017/1564 of 13  September 2017 on certain permitted uses of 
certain works and other subject matter protected by copyright and related rights 
for the  benefit of persons who are blind, visually impaired or otherwise 
print-disabled and amending Directive 2001/29/EC on the harmoni zation of 
certain aspects of copyright and related rights in the information society . IP/N/1/EU/C/12  
 
Directive (EU) 2019/789 of 17 April 2019 laying down rules on the exercise of 
copyright and related rights applicable to certain online transmissions of 
broadcasting organisations and retransmissions of television and radio 
programmes, and amending Council Directive 93/83/EEC . IP/N/1/EU/C/13  
 
Directive (EU) 2019/790 of the European Parliament and of the Council of 
17 April 2019 on copyright and related rights in the Digital Single Market and 
amending Directives 96/9/EC and 2001/29/EC . IP/N/1/EU/C/14  
Trade Marks  
Council Regulation (EC) No. 207/2009 of 26 February 2009 on the Community 
trade mark . IP/N/1/EU/T/2  
 
Regulation (EU) 2015/2424 of 16 December 2015 amending Council Regulation 
(EC) No. 207/2009 on the Community trade mark and Commission Regulation 
(EC) No. 2868/95 implementing Council Regulation (EC) No. 40/94 on the 
Community trade mark, and repealing Commission Regulation (EC) No. 2869/95 
on the fees payable to the Office for Harmonization in the Internal Market (Trade 
Marks and Designs) . IP/N/1/EU/T/6  
Directive 2008/95/EC of 22 October 2008 to approximate the laws of the 
member States relating to trade marks . IP/N/1/EU/T/1  
Directive (EU) 2015/2436 of the European Parliament and of the Council of 
16 December 2015 to approximate the laws of the member St ates relating to 
trade marks . IP/N/1/EU/T/5  
 
Commission Regulation (EC) No. 2868/95 of 13 December 1995 implementing 
Council Regulation (EC) No.  40/94 on the Community trade mark, as amended 
by Commission Regulation (EC) No. 782/2004 of 26  April 2004, Com mission 
Regulation (EC) No. 1041/2005 of 29 June 2005, and Commission Regulation 
(EC) No. 355/2009 of 31 March 2009 . IP/N/1/EU/T/7, 
IP/N/1/EU/T/8 and 
IP/N/1/EU/T/4  WT/TPR/S/395 • European Union  
 
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  Legislative measure  Notification to Council 
for TRIPS pursuant to 
Article  63.2 TRIPS  
Commission Regulation (EC) No. 216/96 of 5 February 1996 laying down the 
procedures of the  Boards of Appeal of the Office for Harmonization in the 
Internal Market (Trade marks and Designs) . IP/N/1/EU/T/9  
 
Commission Regulation (EC) No. 2082/2004 of 6 December 2004, amending 
Regulation (EC) No.  216/96 laying down the rules of procedure of the Boards of 
Appeal of the Office for Harmonization in the Internal Market (Trade marks and 
Designs) . IP/N/1/EU/T/3  
 
Regulation (EU) 2017/1001 of the European Parliament and of the Council of 
14 June 2017 on the European Union trade mark . IP/N/1/EU/T/10  
Commission Delegated Regulation (EU) 2017/1430 of 18 May 2017 
supplementing Council Regulation 207/2009 on the European Union Trade mark 
and repealing Commission Regulations 2868/95 and 216/96 . IP/N/1/EU/T/11  
 
Commission Implementing Regulation EU 2017/1431 of 18 May 2017 laying 
down rules for implementing certain provisions of Council Regulation (EC) 
207/2009 on the European Union Trade mark . IP/N/1/EU/T/12  
Commission Delegated Regulation (EU) 2018/625 of 5 March 2018 
supplementing R egulation (EU) 2017/1001 of the European Parliament and of 
the Council on the European Union trade mark, and repealing Delegated 
Regulation (EU) 2017/1430 . Not yet notified  
Commission Implementing Regulation (EU) 2018/626 of 5 March 2018 laying 
down detai led rules for implementing certain provisions of Regulation (EU) 
2017/1001 of the European Parliament and of the Council on the European 
Union trade mark, and repealing Implementing Regulation (EU) 2017/1431 . Not yet notified  
Geographical Indication s 
Wines : Regulation (EU) No. 1308/2013 of 17 December 2013 establishing a 
common organization of the markets in agricultural products . IP/N/1/EU/G/4  
 
Commission Regulation (EC) No. 607/2009 of 14 July 2009, laying down certain 
detailed rules regarding protected designations of origin and geographical 
indications, traditional terms, labelling and presentation of certain wine sector 
products . IP/N/1/EEC/4 and 
IP/N/1/EEC/G/5  
 
Aromati zed Wines : Regulation (EU) No. 251/2014 of 26 February 20 14 on the 
definition, description, presentation, labelling and the protection of geographical 
indications of aromati zed wine products and repealing Council Regulation (EEC) 
No. 1601/91 . IP/N/1/EU/G/5  
 
Spirit Drinks : Regulation (EC) No. 110/2008 of 15 January 2008 on the 
definition, description, presentation, labelling and the protection of geographical 
indications of spirit drinks . IP/N/1/EEC/4 and 
IP/N/1/EEC/G/6  
 
Commission Implementing Regulation (EU) No. 716/2013 of 25 July 2013 laying 
down rules for the application of Regulation (EC) No. 110/2008 on the definition, 
description, presentation, labelling and the protection of geographical indications 
of spirit drinks . IP/N/1/EU/G/6  
Agricultural products and foodstuffs : Council Regulation (EU) No. 1151/2012 of 
21 November 2012 on quality schemes for agricultural products and foodstuffs . IP/N/1/EU/G/3  
 
Commission Delegated Regulation (EU) No. 664/2014 of 18 December 2013 
supplementing Regulation (EU) No. 1151/2012 with regard to the establishmen t 
of the Union symbols for protected designations of origin, protected geographical 
indications and traditional specialities guaranteed and with regard to certain 
rules on sourcing, certain procedural rules and certain additional transitional 
rules. IP/N/1 /EU/G/7  
 
Commission Implementing Regulation (EU) No. 668/2014 of 13 June 2014 laying 
down rules for the application of Regulation (EU) No. 1151/2012 on quality 
schemes for agricultural products and foodstuffs . IP/N/1/EU/G/8  
 
Commission Delegated Regulation (EU) 2019/33 of 17 October 2018 
supplementing Regulation (EU) No.  1308/2013 of the European Parliament and 
of the Council as regards applications for protection of designations of origin, 
geographical indications and traditional terms in the win e sector, the objection 
procedure, restrictions of use, amendments to product specifications, 
cancellation of protection, and labelling and presentation . IP/N/1/EU/G/9  
 
Commission Implementing Regulation (EU) 2019/34 of 17 October 2018 laying 
down rules f or the application of Regulation (EU) No . 1308/2013 of the European 
Parliament and of the Council as regards applications for protection of 
designations of origin, geographical indications and traditional terms in the wine 
sector, the objection procedure, amendments to product specifications, the 
register of protected names, cancellation of protection and use of symbols, and 
of Regulation (EU) No . 1306/2013 of the European Parliament and of the Council 
as regards an appropriate system of checks . IP/N/1/EU/G/10  
 WT/TPR/S/395 • European Union  
 
- 300 - 
 
  Legislative measure  Notification to Council 
for TRIPS pursuant to 
Article  63.2 TRIPS  
Industrial designs  
Directive 98/71/EC of 13 October 1998 on the legal protection of designs . IP/N/1/EU/D/1  
Council Regulation (EC) No. 6/2002 of 12 December 2001 on Community 
designs, as amended by Council Regulation (EC) No. 1891/2006 of 
18 December  2006. IP/N/1/EU/D/2  
Commission Regulation (EC) No. 2245/2002 of 21 October 2002 implementing 
Council Regulation (EC) No.  6/2002, as amended by Commission Regulation 
(EC) No. 876/2007 of 24 July 2007 . IP/N/1/EU/D/3  
Commission Regu lation (EC) No. 2246/2002 of 16 December 2002 on the fees 
payable to the Office for Harmonization in the Internal Market (Trademarks and 
Designs) in respect of the registration of Community designs, as amended by 
Commission Regulation (EC) No. 877/2007 of 24 July 2007. IP/N/1/EU/D/4  
Council Decision 2006/954/EC of 18 December 2006 approving the accession of 
the EC to the Geneva Act of the Hague Agreement concerning the international 
registration of industrial designs, adopted in Geneva on 2 July 1999. IP/N/1/EU/D/5  
Patents  
Directive 98/44/EC of 6 July 1998 on the legal protection of biotechnological 
inventions . IP/N/1/EEC/P/4  
Regulation (EC) No. 1901/2006 of 12 December 2006 on medicinal products for 
paediatric use and amending Regulation (EEC) No. 1768/92, Directive 
2001/2 0/EC, Directive 2001/83/EC and Regulation (EC) No. 726/2004 . IP/N/1/EU/P/2  
Regulation (EC) No. 816/2006 of 17 May 2006 on compulsory licensing of 
patents relating to the manufacture of pharmaceutical products for export to 
countries with public health pro blems . IP/N/1/EEC/P/5  
Regulation (EU) No. 1257/2012 of 17 December 2012 implementing enhanced 
cooperation in the area of the creation of unitary patent protection . IP/N/1/EU/P/1  
Regulation (EU) No. 1260/2012 of 17 December 2012 implementing enhanced 
cooperation in the area of the creation of unitary patent protection with regard 
to the applicable translation arrangements . IP/N/1/EU/P/8  
Regulation (EC) No. 2470/96 of 17 December 1996 providing for an extension of 
the terms of a community plant variety right in respect of potatoes . IP/N/1/EU/P/9  
Regulation (EU) 2019/933 of the European Parliament and of the Council of 
20 May 2019 amending Regulation (EC) 469/2009 concerning the 
supplementary protection certificate for medicinal p roducts . IP/N/1/EU/P/10  
Supplementary Protection Certificates  
Regulation (EC) No. 1610/96 of 23 July 1996 concerning the creation of a 
supplementary protection certificate for plant protection products . IP/N/1/EU/P/4  
Regulation (EC) No. 469/2009 of 6 May 2009 concerning the supplementary 
protection certificate for medicinal products . IP/N/1/EU/P/3  
Regulation (EU) 2019/933 of the European Parliament and of the Council of 
20 May 2019 amending Regulation (EC) No 469/2009 concerning the 
supplementary prot ection certificate for medicinal products . Not yet notified  
Plant varieties  
Council Regulation (EC) No. 2100/94 of 27 July 1994  on Community plant 
variety rights , as amended by Council Regulation (EC) No. 2506/95 of 25 
October 1995, Council Regulation (EC) No. 807/2003 of 14 April 2003, Council 
Regulation (EC) No. 1650/2003 of 18 June 2003, Council Regulation (EC) 
No. 873/2004 of 29  April 2004 and Council Regulation (EC) No. 15/2008 of 
20 December 2007 . IP/N/1/EEC/P/3  
Council Regulation (EC)  No. 2470/96 of 17 December 1996 providing for an 
extension of the terms of a Community plant variety right in respect of potatoes . IP/N/1/EU/P/9  
Commission Regulation (EC) No. 874/2009 of 17 September 2009, establishing 
implementing rules for the applica tion of Council Regulation (EC) No. 2100/94 as 
regards proceedings before the Community Plant Variety Office, as amended by 
Commission Implementing Regulation (EU) 2016/1448 of 1 September 2016 . IP/N/1/EU/P/5  
Commission Regulation (EC) No. 1238/95 of 31 May 1995 establishing 
implementing rules for the application of Council Regulation (EC) No. 2100/94 as 
regards the fees payable to the Community Plant Variety Office, as amended by 
Commission Regulation (EC) No. 329/2000 of 11 February 2000, Commission 
Regulation (EC) No. 569/2003 of 28 March 2003, Commission Regulation (EC) 
No. 1177/2005 of 20 July 2005, Commission Regulation (EC) No. 2039/2005 of 
14 December 2005, Commission Regulation (EC) No.  572/2008 of 19  June 2008, 
Commission Implementing Regulation (EU) No. 510/2012 of 15 June 2012, 
Commission Implementing Regulation (EU) No. 623/2013 of 27 June 2013, IP/N/1/EU/P/6  WT/TPR/S/395 • European Union  
 
- 301 - 
 
  Legislative measure  Notification to Council 
for TRIPS pursuant to 
Article  63.2 TRIPS  
Commission Implementing Regulation (EU) No. 1294/2014 of 4 December 2014, 
Commission Implementing Regulation (EU) No. 2015/2206 of 
30 November  2015 and  Commission Implementing Regulation (EU) 2016/2141 
of 6 December  2016. 
Commission Regulation (EC) No. 1768/95 of 24 July 1995, establishing 
implementing rules on the agricultural exemption provided for in Article 14(3) of 
Council Regulation (EC) No. 2100/94, as amended by Commission Regulation 
(EC) No. 2605/98 of 3 December 1998 . IP/N/1/EU/P/7  
Protection of layout designs  
Council Directive 87/54/EEC  of 16 December 1986 on the legal protection of 
topographies of semiconductor products . IP/N/1/EEC/L/1  
Council Decision 94/824/EC of 22 December 1994 on the extension of the legal 
protection of semiconductor products to persons from a Member of the WTO . IP/N/1/EEC/L/2  
Undisclosed information and clinical trial data  
Directive 2001/83/EC of 6 November 2001 on the Community code relating to 
medicinal products for human use, as amended by Directive 2004/27/EC of 
31 March 2004 . IP/N/1/EU/U/1  
Directive 2004/27/EC of 31 March 2004 amending Directive 2001/83/EC on the 
Community code relating to medicinal products for human use . IP/N/1/EU/U/4  
Regulation No. 726/2004 of 31 March 2004 laying down Community procedures 
for the authori zation and supervision of medicinal products for human and 
veterinary use and establishing a European Medicines Agency . IP/N/1/EU/U/2  
Directive (EU) 20 16/943 of 8 June 2016 on the protection of undisclosed know -
how and business information (trade secrets) against their unlawful acquisition, 
use and disclosure . IP/N/1/EU/U/3  
Regulation No. 536/2014 of 16 April 2014 on clinical trials on medicinal product s 
for human use, and repealing Directive 2001/20/EC . IP/N/1/EU/U/5  
Enforcement  
Directive 2000/31/EC of 8 June 2000 on certain legal aspects of information 
society services, in particular electronic commerce, in the internal market 
(E-Commerce Directive) . IP/N/1/EU/E/2  
Directive 2004/48/EC of 29 April 2004 on the enforcement of IPRs . IP/N/1/EEC/E/4  
Regulation (EU) No.  386/2012 of 19 April 2012 on entrusting the Office for 
Harmonization in the Internal Market (Trade Marks and Designs) with tasks 
related to the enforcement of intellectual property rights, including the 
assembling of public and private -sector representatives as a European 
Observatory on Infringements of Intellectual Property Rights . IP/N/1/EU/E/3  
Regulation (EU) No. 608/2013 of 12 June 2013 concerning customs enforcement 
of IPRs . IP/N/1/EU/E/1  
Commission Implementing Regulation (EU) No. 1352/2013 of 4 December 2013 
establishing the form provided for in Regulation (EU) No. 608/2013 of the 
European Parliament and of th e Council concerning customs enforcement of 
intellectual property rights . IP/N/1/EU/E/4  
Source:  WTO Secretariat.  
  WT/TPR/S/395 • European Union  
 
- 302 - 
 
  Table A3. 6 Term of protection of major IPRs, 2019  
Type of right  Term of protection  Competent 
agency at the 
EU level  
Copyright    
• Authors' right s Life of the author plus 70 years , irrespective of the date the 
work was lawfully made available to the public. In the case of 
joint authorship , the term should be calculated after the death 
of the last surviving author. In the case of anonymous or 
pseudonymous works, 70 years after the wo rk is lawfully made 
available to the public. If the pseudonym does not leave any 
doubt as to the identity of the author, then protection is for the 
life of the author plus 70 years , irrespective of the date the 
work was lawfully made available to the publi c Copyright is 
protected 
without 
registration  
• Work published in 
volumes  Protection runs from the time the work was lawfully made 
available to the public  
• Cinematographic or 
audiovisual worksa 
 Protection expires 70 years after the death of the last of the 
following persons to survive, whether or not these persons are 
designated as co -authors: principal director (wh o is always 
considered an author), author of the screenplay, author of the 
dialogue , and composer of the original music  
• Performers  Protection expires 50 years after the date of the performance. 
However, if a fixation of the performance otherwise than in a 
phonogram is lawfully published or lawfully communicated to 
the public within this period, the rights expire 50  years  from 
the date of the first such publication or the first such 
communication to the public, whichever is the earlier; in the 
case of a fixation of the performance in a phonogram, the 
rights shall expire after 70 years  
• Producers of 
phonograms  Protection expires 50 years after the fixation is made. 
However, if the phonogram has been lawfully published within 
this period, the rights expire 70  years  from the date of the first 
lawful publication. If no lawful publication has taken place, and 
the ph onogram has been lawfully communicated to the public 
within this period, the rights will expire 7 0 years  from the date 
of the first lawful communication to the public  
• Producers of a filmb Protection expires 50 years  after the fixation is made. 
However, if the film is lawfully published or lawfully 
communicated to the public during this period, the rights will 
expire 50 years  from the date of the first such publication or 
the first such communication to the public, wh ichever is the 
earlier  
• Broadcasting 
organizations  Protection expires 50 years  after the first transmission of a 
broadcast , whether transmitted by wire or over the air, 
including by cable or satellite  
• Photographsc Life of the author plus 70 years , no matter when it was lawfully 
made available to the public. In the case of joint authorship, 
the term should be calculated after the death of the last 
author. In the case of anonymous or pseudonymous works, 
70 years after the work is lawfully made availa ble to the 
public. If the pseudonym does not leave any doubt as to the 
identity of the author , then protection is for the life of the 
author plus 70  years no matter when the work was lawfully 
made available to the public  
Patents    
Any inventions, in all field s of 
technology, that are new, 
involve an inventive step, 
and are susceptible of 
industrial application  20 years from the date of filing; under a n SPC, an additional 
period of market exclusivity of up to five years may be granted 
for medicinal and plant protection products; an extension of 
another six months is available under paediatric legislation  EPO for European 
patents  
Plant varieties    
Plant varieties which are 
distinct, uniform, stable, and 
new Plant varieties for 25 years. Protection may be extended for 5 
years. Varieties of vine, tree and potato species for 30 years  CPVO  WT/TPR/S/395 • European Union  
 
- 303 - 
 
  Type of right  Term of protection  Competent 
agency at the 
EU level  
Trademarks    
Any signs, particularly 
words, including personal 
names, designs, letters, 
numerals, colours, the shape 
of goods or their packaging, 
or sounds, provided that 
such signs are capable of 
distinguishing the goods or 
services of one undertaking 
from those of ot her 
undertakings , and being 
represented on the Register 
of EUTMs in a manner which 
enables the competent 
authorities and the public to 
determine the clear and 
precise subject matter of the 
protection afforded to its 
proprietor  10 years from the date of fil ing of application, may be renewed 
for an indefinite number of 10 -year periods  EUIPO for 
EUTMs s 
GIs   
Indications which identify a 
good as originating in the 
territory of a Member or a 
region or locality in that 
territory, where a given 
quality, reputation or other 
characteristic of the good are 
essentially attributable to its 
geographical origin  For GIs protected as PDO/PGI, the term of protection is 
indefinite, unless the GI ceases to be protected  European 
Commission DG 
AGRI  
Industrial designs    
Designs that are new and 
have individual character. A 
design is considered new if 
no identical design (i.e. one 
whose features differ only in 
immaterial details) has been 
made available to the public. 
It has individual character if 
the overall impression it 
produces on the informed 
user differs from the overall 
impression produced on such 
a user by any design which 
has been made available to 
the public  Registered design: one or more periods of 5 years, up to a 
maximum of 25 years from the date of filing. Unregistered 
design: 3 years after publication  EUIPO for 
Community 
designs  
Undisclosed test or other 
data   
Data, the origination of 
which involves considerable 
effort and which must be 
submitted to regulatory 
authorities in order to obtain 
marketing approval of 
pharmaceutical or of 
agricultural chemical 
products which utilize n ew 
chemical entities  8-11 years of data and marketing protection  The EMA grants 
marketing 
authorization  
a The principal director of a cinematographic or audiovisual work is considered the author. The author 
of the screenplay and/or the author of a dialogue are designated as co -authors.  
b The term "film" designates a cinematographic or audiovisual work or moving images, whether or not 
accompanied by sound.  
c Photographs are protected under Community law only if they are the author's own intellectual creation. 
Member States may provide pr otection for other photographs.  
Source:  WTO Secretariat.   
  WT/TPR/S/395 • European Union  
 
- 304 - Table A4. 1 Regulatory restrictions in construction services, by selected member State, 2018  
 AUT BEL CZE DNK EST FIN FRA DEU GRC HUN IRL ITA LVA LTU LUX NLD POL PRT SVK SVN ESP SWE GBR 
Foreign equity 
restrictions: maximum 
foreign equity share 
allowed (%)  100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 
There are limits to the 
proportion of shares that 
can be acquired by 
foreign investors in 
publicly -controlled firms  no no no no no no no no no no no no no no no no no no no no no yes no 
Legal form: only joint 
ventures are allowed  no no no no no no no no no no no no no no no no no no no no no no no 
Legal form: foreign 
branches are prohibited  no no no yes no no no no no no no no no no no no no no no no no no no 
Legal form: other 
restrictions  no no no yes no yes no no no no no no no no no no no no no no no yes no 
Board of directors: 
majority must be 
nationals  no no no no no no no no no no no no no no no no no no no no no no no 
Board of directors: 
majority must be 
residents  no yes no no no no no no no no no no no no no no no no no no no yes no 
Board of directors: at 
least one must be a 
national  no no no no no no no no no no no no no no no no no no no no no no no 
Board of directors: at 
least one must be a 
resident  no no no no no yes no no no no yes no no no no no no no no no no yes no 
Managers must be 
national  no no no no no no no no no no no no no no no no no no no no no no no 
Managers must be 
resident  no no no no no yes no no no no no no no no no no no no no no no yes no 
Screening explicitly 
considers economic 
interests  no no no no no no no no no no no no no no no no no no no no no no no 
Screening exists without 
exclusion of economic 
interests  no no no no no yes no yes yes no no no no no no no no no no no no no yes 
Memo: thresholds for 
screening projects  no no no no no yes no no no no no no no no no no no no no no no no no 
Acquisition and use of 
land and real estate by 
foreigners is restricted  yes no no yes yes no no no yes yes no yes yes yes no no yes no yes yes yes no no 
Restrictions on the type 
of shares or bonds held 
by foreign investors  no no no no no no no no no no no no no no no no no no no no no no no 
Conditions on 
subsequent transfer of 
capital and investments  no no no no no no no no no no no no no no no no no no no no no no no  
  WT/TPR/S/395 • European Union  
 
- 305 -  AUT BEL CZE DNK EST FIN FRA DEU GRC HUN IRL ITA LVA LTU LUX NLD POL PRT SVK SVN ESP SWE GBR 
Restrictions on cross -
border mergers and 
acquisitions  no no no no no no no no no no no yes no no no no no no no no no no no 
Performance 
requirements  no no no no no no no no no no no no no no no no no no no no no no no 
Discriminatory 
qualification 
requirements for building 
permits to undertake 
construction work  no no no no no no no no no no no no no no no no no no no yes no no no 
Commercial presence is 
required in order to 
provide cross -border 
services  no no no no yes no no no no no no no no no yes no no yes no no no no no 
Local presence is 
required for cross -border 
supply  no no yes no yes no yes yes yes no no no yes yes no no no no no yes no no no 
Memo: free cross -border 
transfer of personal data 
or application of the 
accountability principle  no no no no no no no no no no no no no no no no no no no no no no no 
Cross -border transfer of 
personal data is possible 
when certain private -
sector safeguards are in 
place  yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes 
Cross -border data flows: 
cross-border transfer of 
personal data is possible 
to countries with 
substantially similar 
privacy protection laws  yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes 
Cross -border data flows: 
cross-border transfer is 
subject to approval on a 
case-by-case basis  no no no no no no no no no no no no no no no no no no no no no no no 
Cross -border data flows: 
certain data must be 
stored locally  no no no yes no no no yes no no no no no no no no yes no no no no yes no 
Cross -border data flows: 
transfer of data is 
prohibited  no no no no no no no no no no no no no no no no no no no no no no no 
Other restrictions on 
foreign entry  no no no no no no no no no no no no no no no no yes no yes no no no no 
Quotas: intra -corporate 
transferees  yes no no no yes no no no no yes no no no no no no no no no yes no no no 
Quotas: contractual 
services suppliers  no no no no yes no no no no yes no no no no no no no no no yes no no yes 
Quotas: independent 
services suppliers  no no no yes yes no no no no yes no yes no no no no no no no yes no no yes  
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Labour market tests: 
intra-corporate 
transferees  yes yes no yes yes yes yes no yes yes yes no yes yes yes yes yes yes no yes yes yes yes 
Labour market tests: 
contractual services 
suppliers  yes yes yes yes yes yes yes yes yes yes yes no no yes yes yes yes no yes no no yes yes 
Labour market tests: 
independent services 
suppliers  yes yes no yes yes yes yes yes no yes yes yes no no yes yes yes no no no no no yes 
Limitation on duration of 
stay for intra -corporate 
transferees (months)  36 12 36 48 36 12 36 36 24 12 24 36 60 36 36 36 36 36 36 36 36 36 61 
Limitation on duration of 
stay for contractual 
services suppliers 
(months)  12 12 24 48 12 12 12 3 24 36 24 24 60 12 36 12 36 12 24 3 12 24 61 
Limitation on duration of 
stay for independent 
services suppliers 
(months)  12 24 12 24 60 12 12 36 24 36 24 24 12 12 36 12 36 12 36 3 24 24 61 
Other restrictions to 
movement of people  no no no yes no no no no no no yes no no no no yes no no no yes no no yes 
Foreign suppliers are 
treated less favourably 
regarding taxes and 
eligibility to subsidies  no no no no no no no no no no no no no no no no no no no no no no no 
Public procurement: 
explicit preferences for 
local suppliers  no yes no no no no yes no yes yes no yes no no no no no no no no yes no no 
Public procurement: 
procurement regulation 
explicitly prohibits 
discrimination of foreign 
suppliers  yes no no no no no no yes no no no no no no no no no no no no no no no 
Memo: thresholds above 
which tender is 
mandated  yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes 
Memo: the procurement 
process below the value 
thresholds affects the 
conditions of competition 
in favour of local firms  yes no no no no no no no yes yes yes no no no yes no yes no no yes no no no 
Public procurement: 
technical specifications 
affect the conditions of 
competition in favour of 
local providers  no no no no no no no no no no no no no no no no no no no no no no no 
Public procurement: 
discriminatory 
qualification processes 
and procedures  no yes no no no no no no no no no no no no no no no no no no no no no  
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Public procurement: 
contract award on the 
basis of non -
objective/discriminatory 
criteria  no no no no no no no yes no no no no yes no no no no no no no no no no 
Public procurement: 
procurement laws, 
regulations and 
procedures are 
transparent  yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes 
Public procurement: 
foreign suppliers are 
provided the opportunity 
to challenge the 
consistency of the 
conduct of procurement 
with the laws and 
regulations  yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes 
Laws or regulations 
impose national 
standards that deviate 
from international 
standards: building 
design code standards  no no no no no no no no no no no no no no no no no no no no no no no 
Laws or regulations 
impose national 
standards that deviate 
from international 
standards: construction 
product standards  no no no no no no no no no no no no no no no no no no no no no no no 
Other restrictions in 
other discriminatory 
measures  no no no no no no no no no no no no no no no no no no no no no no no 
Decisions by the 
regulatory body can be 
appealed  yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes 
Firms have redress when 
business practices 
restrict competition in a 
given market  yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes 
National, state or 
provincial government 
control s at least one 
major firm in the sector  no no no no no no no no yes no no no no no no no no no no no no yes no 
Publicly -controlled firms 
are exempted from the 
application of the general 
competition law  no no no no no no no no no no no no no no no no no no no no no no no 
Prices or fees are 
regulated  no no no no no no no no no no no no no no no no no no no no no no no  
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Minimum capital 
requirements  yes yes yes yes yes yes yes no yes yes no yes yes yes yes no yes yes yes yes yes yes no 
Restrictions on 
advertising  no no no no no no no no no no no no no no no no no no no no no no no 
Other restrictions in 
barriers to competition  no no no no no no no no no no no no no no no no no no no no no no no 
There is a legal 
obligation to 
communicate regulations 
to the public within a 
reasonable time prior to 
entry into force  yes no yes no no no no yes yes no no yes no no no yes yes no yes yes yes no no 
There is an adequate 
public comment 
procedure open to 
interested persons, 
including foreign 
suppliers  no no yes yes yes yes yes yes yes yes yes no yes yes no yes yes yes yes yes yes yes yes 
Range of visa processing 
time (days)  15 15 15 15 15 5 5 10 15 15 10 15 10 14 15 15 14 15 15 15 15 15 15 
Multiple entry visa for 
business visitors  yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes 
Cost to obtain a business 
visa (USD)  179 71 71 70 95 69 71 67 60 67 61 71 67 71 71 71 73 85 71 71 71 71 120 
Number of documents 
needed to obtain a 
business visa  16 9 7 7 5 11 16 15 14 9 12 8 10 9 13 12 13 14 11 7 14 14 2 
Time required to obtain a 
construction permit (in 
calendar days)  222 212 246 64 103 65 183 126 124 205 149 227 192 75 157 161 153 160 300 239 208 117 86 
Total cost required to 
obtain a construction 
permit (% of warehouse 
value)  1.2 1 0.2 1.4 0.2 0.9 3 1.2 2 0.6 4.6 3.6 0.5 0.3 0.7 3.7 0.3 1.3 0.2 2.9 5.4 2 1 
Number of procedures 
required to obtain a 
construction permit 
(number)  11 10 21 7 10 17 9 9 18 20 10 12 14 13 11 13 12 14 14 14 15 8 9 
Other restrictions in 
regulatory transparency  no no no yes no no no no no no no no no no no no no no no no no no no 
Source:  OECD . Intra-EEA Trade Restrictiveness Index . Viewed at: http://www.oecd.org/trade/topics/services -trade/ . 
 
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