CYIL 2012

EDITA ŠEDOVÁ ȃ DAVID MÜLLER CYIL 3 ȍ2012Ȏ Further, the FTA contains separate chapters dealing with trade remedies, sanitary and phytosanitary measures (SPS), customs and trade facilitation. A fundamental element of the FTA is its direct focus on elimination of most problematic non-tariff barriers in the areas of electrical and electronic equipment, automotive products, pharmaceutical products and medical devices and chemicals through strong and precise provisions contained in separate sector specific annexes . The annexes provide for an improved regulatory cooperation, including self-declaration of conformity, elimination of double testing requirements and adoption of international standards. Concerning consumer electronics, the Agreement shall eliminate costly and duplicative testing and certification procedures, especially by use of international standards and approval procedures. Regulatory and technical barriers in the motor vehicle sector are also expected to be reduced, as the FTA commits Korea to accept the equivalence of international or EU standards. With regard to pharmaceutical products and medical devices, the FTA introduces stronger transparency rules for the process of price setting and reimbursement of drugs. In the chemical sector the FTA specifies major elements of bilateral cooperation in order to ensure more transparency Having in mind rapid expansion of the services sector and its contribution to the world economy, the EU ranks services among its main interests when negotiating FTAs. Thus the EU requires from its negotiating partners commitments going not only beyond the current General Agreement on Trade in Services (GATS) obligations but also beyond proposals in the on-going DDA negotiations. And this is the case of the FTA with Korea as well, which undoubtedly goes beyond any agreement both the EU and Korea have ever concluded with a third party. The FTA confirms obligations of both parties arising from the GATS agreement and in addition sets provisions for progressive reciprocal liberalisation related to all modes of supply. 25 The schedule of commitments is based on the “positive list approach”, which means that each party commits itself only in specific services tabled in a list of commitments and where the party grants to service providers national treatment and market access. 26 This approach is used in all agreements the EU has concluded so far. 27 Whereas the EU services market is already quite broadly open, the same cannot be said of Korea. Therefore the commitments taken by Korea in the FTA bring strong preferential advantage and new market potential for EU entrepreneurs, especially when taking into account the fact that the preferential access gained by the EU is much better than Korea grants to other countries, including the US. On the basis 25 According to GATS, services may be provided by four modes of supply: mode 1 – cross-border supply; mode 2 – consumption abroad; mode 3 – commercial presence; mode 4 – presence of natural persons. 26 “Negative list approach” means that a party liberalises all services except those explicitly tabled in a schedule of commitments. 27 Taking into consideration also FTAs the EU is currently negotiating, only a trade agreement with Canada shall be based on “negative list approach”. in the laws and regulations, as well as in their implementation. 3.3 Facilitation of Trade in Services and Establishment

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