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EU-Canada trade pact comes into force

September 21, 2017

A landmark free trade deal linking the European Union and Canada has come into effect despite lingering opposition from activists. The EU hailed the pact as one of its most ambitious ever, "setting a new standard."

Hamburg port
Image: picture-alliance/dpa/F. Bimmer

The EU and Canada signed the Comprehensive Economic and Trade Agreement (CETA) in October of last year, but it only entered into force on Thursday, albeit provisionally.

CETA was implemented in large parts pending approval by the EU's more than 30 national and regional parliaments which could take years. Only five parliaments have so far ratified the agreement.

The pact affects 510 million European consumers and 35 million Canadians and eliminates customs duties on 98 percent of products as of Thursday.

Outstanding questions

While this part of the agreement has never been questioned, left out of the deal until the end of the ratification process is a controversial investment protection scheme. Under it, companies have recourse to legal arbitration, if they believe their rights have been violated by a change in government policy.

Infographic on what Germans think about CETA

This provision has raised huge concerns among pressure groups in Europe which fear a rollback of European regulation on the environment and health by powerful multinational players.

Greenpeace for instance is concerned that "Canada has weaker food safety and labeling standards than the EU, and industrial agriculture is more heavily dependent on pesticides and GM crops."

Despite the criticism, Brussels has been hailing CETA as one of its most ambitious trade pacts ever that is supposed to set a new standard for future deals in the pipeline, especially with Japan, Australia and New Zealand.

The president of the Association of German Chambers of Industry and Commerce (DIHK), Eric Schweitzer, said Thursday CETA provides a strong sign of hope for international trade.

"Faced with a surge of protectionism globally, it is important to fight for open markets and international co-operation," Schweitzer told Germany's DPA news agency.

Cheesemakers wary of CETA

hg/jd (AFP, Reuters, dpa)