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Brexit relevant? EU competence in free trade agreements – AG Sharpston opinion

On December 21 2016, AG Sharpston issued an opinion that is regarded as an important indicator with respect to trade agreements that will have to be entered into between the EU and the UK after a Brexit. The opinion related to the Free Trade Agreement between the EU and Singapore (the ‘EUSFTA’), which was initiated in September 2013.

The EUSFTA is destined to be an agreement between the EU and the Republic of Singapore, without participation of the Member States. The Commission argued that the EU has exclusive competence to conclude the agreement. The Council and the governments of the Member States, on the other hand, contended that the EU cannot conclude the agreement on its own because certain parts of EUSFTA fall within the shared competence of the EU and the Member States.

AG Sharpston agrees with this view and considers that the EUSFTA can only be concluded by the EU and the Member States acting jointly. She adds that the EU has no external competence to agree to be bound by that part of the EUSFTA which terminates bilateral agreements concluded between certain Member States and Singapore. In her view, that competence belongs exclusively to the Member States concerned. While the AG notes that difficulties may arise from a ratification process involving all of the Member States alongside the EU, she considers that that cannot affect the question of the competence to conclude the agreement. This opinion has been regarded as an important pointer towards Brexit and the trade agreements that the UK and the EU will have to conclude.

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Eleanor V. E. Sharpston, QC is an Advocate General at the Court of Justice of the European Union. The UK Advocate General at the Court of Justice of the European Communities since 10 January 2006.

Compliments of Houthoff Buruma – a member of the EACCNY