Source: EURLEX
Language: en
Format: md

**Council of the**
**European Union**

**Interinstitutional File:**

**2024/0135(NLE)**

**PROPOSAL**

**Brussels, 12 June 2024**
**(OR. en)**

**11138/24**

**COEST 372**
**POLCOM 212**

From: Secretary-General of the European Commission, signed by Ms Martine
DEPREZ, Director

To: Ms Thérèse BLANCHET, Secretary-General of the Council of the
European Union

No. Cion doc.: COM(2024) 239 final

Subject: Proposal for a COUNCIL DECISION on the position to be taken on
behalf of the European Union within the Partnership Committee
established by the Comprehensive and Enhanced Partnership
Agreement between the European Union and the European Atomic
Energy Community and its Member States, of the one part, and the
Republic of Armenia, of the other part, regarding the adoption of the
Mediation Mechanism, Rules of Procedure and Code of Conduct for
dispute settlement procedures on trade and trade related matters

Delegations will find attached document COM(2024) 239 final.

Encl.: COM(2024) 239 final

11138/24 IS/mjg
## RELEX 3 EN

EUROPEAN

COMMISSION

Brussels, 11.6.2024
COM(2024) 239 final

2024/0135 (NLE)

Proposal for a

**COUNCIL DECISION**

**on the position to be taken on behalf of the European Union within the Partnership**
**Committee established by the Comprehensive and Enhanced Partnership Agreement**

**between the European Union and the European Atomic Energy Community and its**

**Member States, of the one part, and the Republic of Armenia, of the other part,**
**regarding the adoption of the Mediation Mechanism, Rules of Procedure and Code of**

**Conduct for dispute settlement procedures on trade and trade related matters**

# **EN EN**

**EXPLANATORY MEMORANDUM**

**1.** **S** **UBJECT MATTER OF THE PROPOSAL**

This proposal concerns a decision establishing the position to be taken on the Union's behalf
in the Partnership Committee established pursuant to Article 363(1), meeting in trade
configuration pursuant to Article 363(7), of the Comprehensive and Enhanced Partnership
Agreement between the European Union and the European Atomic Energy Community and
its Member States, of the one part, and the Republic of Armenia, of the other part (‘the
Agreement’), in connection with the envisaged adoption of the Mediation Mechanism, the
Rules of Procedure and the Code of Conduct for dispute settlement procedures persuant to
Article 319(3) and Article 335(2) of the Agreement.

This proposal sets out the necessary procedures enabling the European Union and the
Republic of Armenia (‘the Parties’) to effectively address bilateral disputes concerning the
application and interpretation of the Agreement, without supplementing or amending the
institutional framework of the Agreement.

**2.** **C** **ONTEXT OF THE PROPOSAL**

**2.1.** **The EU-Armenia Comprehensive and Enhanced Partnership Agreement**

The Agreement establishes a comprehensive and enhanced partnership between the Parties
within the limits of their respective competences, based on common interest and on the
deepening of the relationship in all areas of its application.

It was concluded by the Council of the European Union on 26 June 2020 after obtaining the
consent of the European Parliament on 4 July 2018. The Agreement was provisionally applied
since 1 June 2018 and entered into force on 1 March 2021.

**2.2.** **The Partnership Committee**

Article 363(1) of the Agreement establishes the Partnership Committee. According to
Article 363(7) of the Agreement, the Partnership Committee shall meet in a specific
configuration composed of representatives of the Parties to address all issues related to
Title VI (Trade and Trade Related Matters). Article 363(6) of the Agreement stipulates that all
decisions of the Partnership Committee shall be taken by agreement between the Parties,
following the completion of their respective internal procedures. Pursuant to Article 363(6) of
the Agreement, those decisions shall be binding upon the Parties, which shall take appropriate
measures to implement them.

**2.3.** **The envisaged act of the Partnership Committee**

According to Article 319(3) of the Agreement, the Partnership Committee shall adopt by
decision the Mediation Mechanism at its first meeting and may decide amendments thereto.

Pursuant to Article 335(2) of the Argeement, the Partnership Committee shall adopt by
decision the Rules of Procedure and the Code of Conduct at its first meeting and may decide
amendments thereto.

The Mediation Mechanism, the Rules of Procedure and the Code of Conduct have not been
adopted in the first meeting of the Partnership Committee on 25 September 2018. This is due
to revision work done by the Union on the textual templates, including experience from past
dispute proceedings of the Union with Korea, Ukraine, the South African Customs Union and
Algeria. The revised texts have been accepted by Armenia in the meeting of the Partnership
Committee on 17 October 2023.

# EN 1 EN

The Mediation Mechanism provides for the facilitation of finding a mutually agreed solution
between the Parties through a comprehensive and expeditious procedure with the assistance of
a mediator.

The Rules of Procedure set out the procedures that have to be followed from the rise of a
dispute between the Parties to its settlement.

The Code of Conduct establishes the rules that arbitrators and mediators have to adhere to in
disupte settlement proceedings, elaborating their duties, rights and obligations.

The draft proposal of the Mediation Mechanism, the Rules of Procedure and the Code of
Conduct for dispute settlement procedures prepared between the Parties could be adopted by
the Partnership Committee.

In the meeting of the Partnership Committee on 17 October 2023, the Parties have accepted
the English language as the only authentic language for the decision of the Partnership
Committee. The adoption in English is appropriate in view of Rule 48 of the Rules of
Procedure which sets English as fall-back language for dispute settlement proceedings. In
addition, the Mediation Mechanism, the Rules of Procedure and the Code of Conduct are only
relevant for the organisation of the procedure regarding disputes between the Parties. They
have no direct effect on citizens and businesses of the Union.

Translations in all official languages of the Union may be provided for the publication of the
decision of the Partnership Committee in the Official Journal of the European Union for
information purposes.

**3.** **P** **OSITION TO BE TAKEN ON THE** **U** **NION** **'** **S BEHALF**

The position to be taken on the Union’s behalf should be to support the adoption of the
Mediation Mechanism, the Rules of Procedure and the Code of Conduct. The position should
be based on the draft Decision of the Partnership Committee attached to the proposed Council
Decision establishing the position of the Union.

**4.** **L** **EGAL BASIS**

**4.1.** **Procedural legal basis**

_4.1.1._ _Principles_

Article 218(9) of the Treaty on the Functioning of the European Union (‘TFEU’) provides for
decisions establishing ‘the positions to be adopted on the Union’s behalf in a body set up by
an agreement, when that body is called upon to adopt acts having legal effects, with the
exception of acts supplementing or amending the institutional framework of the agreement.’

The concept of ‘acts having legal effects’ includes acts that have legal effects by virtue of the
rules of international law governing the body in question. It also includes instruments that do
not have a binding effect under international law, but that are ‘capable of decisively
’ [1]
influencing the content of the legislation adopted by the EU legislature .

_4.1.2._ _Application to the present case_

The Partnership Committee is a body set up by the Agreement.

1 Judgment of the Court of Justice of 7 October 2014, Germany v Council, C-399/12,
ECLI:EU:C:2014:2258, paragraphs 61 to 64.

# EN 2 EN

According to Articles 319(3) and 335(2) of the Agreement, the Partnership Committee is
authorised to adopt the Mediation Mechanism, the Rules of Procedure and the Code of
Conduct, complementing the operational frame of the Dispute Settlement Chapter of the
Agreement (Chapter 13 of Title VI).

This act, which the Partnership Committee is called upon to adopt, constitutes an act having
legal effects as Article 363(6) of the Agreement provides that decisions adopted by the
Partnership Committee are binding on the Parties.

The envisaged act does not supplement or amend the institutional framework of the
Agreement. The Mediation Mechanism, the Rules of Procedure and the Code of Conduct are
instruments to support the functioning of the Dispute Settelement Chapter of the Agreement.
They operate as Annexes to this Chapter providing for the effective application and
interpretation of the Agreement, but do not add substantive provisions altering the Agreement
and its institutional framework.

Therefore, the procedural legal basis for the proposed Council Decision is Article 218(9)
TFEU.

**4.2.** **Substantive legal basis**

_4.2.1._ _Principles_

The substantive legal basis for a decision under Article 218(9) TFEU depends primarily on
the objective and content of the envisaged act in respect of which a position is taken on the
Union's behalf.

_4.2.2._ _Application to the present case_

According to Article 207(1) TFEU, the common commercial policy particularly encompasses
‘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’.

The Agreement includes the Dispute Settlement Chapter as an integral part in its Chapter 13
of Title VI. The Dispute Settlement Chapter of the Agreement is directly linked to the
common commercial policy of the Union. It guarantees the efficient settling of bilateral
disputes concerning the application and interpretation of the Agreement between the Union
and Armenia. The disputes concerned would cover the interpretation and application of
provisions of the Agreement realting to trade and trade related matters. The envisaged act
adopts Annexes to the Dispute Settlement Chapter to ensure the proper operation of the
dispute settlement proceedings on trade and trade related matters. The main objective and
content of the envisaged act relate to the common commercial policy through the link to
dispute settlement.

Therefore, the substantive legal basis of the proposed Council Decision is Article 207(4), first
subparagraph TFEU.

**4.3.** **Conclusion**

The legal basis of the proposed Council Decision is Article 207(4), first subparagraph TFEU,
in conjunction with Article 218(9) TFEU.

# EN 3 EN

2024/0135 (NLE)

Proposal for a

**COUNCIL DECISION**

**on the position to be taken on behalf of the European Union within the Partnership**
**Committee established by the Comprehensive and Enhanced Partnership Agreement**

**between the European Union and the European Atomic Energy Community and its**

**Member States, of the one part, and the Republic of Armenia, of the other part,**
**regarding the adoption of the Mediation Mechanism, Rules of Procedure and Code of**

**Conduct for dispute settlement procedures on trade and trade related matters**

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular the
first subparagraph of Article 207(4), in conjunction with Article 218(9) thereof,

Having regard to the proposal from the European Commission,

Whereas:

(1) The Comprehensive and Enhanced Partnership Agreement between the European
Union and its Member States, of the one part, and the Republic of Armenia, of the
other part [2] (‘the Agreement’), has been provisionally applied since 1 June 2018 and
entered into force on 1 March 2021.

(2) Articles 319(3) and 335(2) of the Agreement require the Partnership Committee,
meeting in trade configuration as set out in Article 363(7) of the Agreement, to adopt
at its first meeting after the entry into force of the Agreement the Mediation
Mechanism, the Rules of Procedure and the Code of Conduct for the dispute
settlement procedures under Chapter 13 of Title VI of the Agreement.

(3) The Mediation Mechanism, the Rules of Procedure and the Code of Conduct have not
been adopted since the first meeting of the Partnership Committee on 25 September
2018.

(4) A revised draft proposal of the Mediation Mechanism, the Rules of Procedure and the
Code of Conduct for dispute settlement has been prepared between the Parties and
should be adopted by the Partnership Committee.

(5) It is appropriate to establish the position to be taken on the Union's behalf in the
Partnership Committee regarding the adoption of the Mediation Mechanism, the Rules
of Procedure and the Code of Conduct to dispute settlement.

(6) The Mediation Mechanism, the Rules of Procedure and the Code of Conduct
complement the Agreement and should be published in the Official Journal of the
European Union,

2 OJ L 23, 26.1.2018, p. 4.

# EN 4 EN

HAS ADOPTED THIS DECISION:

_Article 1_

The position to be taken on the Union's behalf within the Partnership Committee established
by the Agreement regarding the adoption of the Mediation Mechanism, the Rules of
Procedure and the Code of Conduct for dispute settlement shall be based on the text of the
draft decision of the Partnership Committee attached to this Decision.

Minor technical corrections to the draft decision may be agreed to by the representatives of
the Union within the Partnership Committee without further decision of the Council.

_Article 2_

After its adoption, the decision of the Partnership Committee shall be published in the Official
Journal of the European Union.

_Article 3_

This Decision shall be addressed to the Commission.

Done at Brussels,

_For the Council_

_The President_

# EN 5 EN