In  light  of  the  renewed  political  revival  in  the  EU-MERCOSUR  FTA  negotiations,  CLEPA underlines its continued support for the negotiations as they would bring important benefits  to both economies, in the form  of an ambitious and comprehensive trade deal. CLEPA hopes that the changes  in  the  political  landscape  will  favour  stronger  commitment  to  pave  the  way  for  a successful conclusion of the negotiations. 

Under HS tariff code 8707 (automotive parts and accessories), the trading volumes during 2016 between the EU and Brazil was 1.8bn USD and between the EU and Argentina it was 848 million USD. 

The  objective  of  the  negotiations  between  the  European  Union  and  MERCOSUR  centres  on cutting customs duties, removing barriers to trade in services and improving the rules relating to public tenders, customs procedures, technical barriers to trade, as well as protection of intellectual property rights. 

CLEPA agrees that a Free Trade Agreement is the best way to achieve meaningful market openings and improve the overall trade and investment conditions for its members in the MERCOSUR region. 

In line with CLEPA’s general principles on FTAs,

CLEPA supports:

• Full tariff liberalisation;

The elimination of all customs duties and quotas  symmetrically (at the same time and under the same conditions) and within short transitional periods (2-5 years), reciprocally;

• Addition of an automotive specific Annex (for vehicles and parts), eliminating all Non-Tariff Barriers.

• CLEPA  is  a  strong  supporter  of  the  UNECE  process,  as  the  main  focus  for international harmonisation of technical regulations (and of ISO for international standards). CLEPA supports the abolition of all NTBs and welcomes the active, focused  and  political  support  of  the  European  Commission  to  convince MERCOSUR members to join the Geneva WP.29 Forum, to become Contracting Parties  to  the  UN  1958  Agreement  and  to  sign  and  apply  at  least  all  the  UN Regulations,  annexed  to  the  1958  Agreement  which  the  EU  has  signed  and  is applying. In the case where a country has not signed, it should at least recognise and accept the EU and UNECE approvals and markings for EU automotive goods, thereby accepting the corresponding UN and EC type-approved products, without any  additional  requirements  (e.g.  further  testing,  marking  or  administrative procedures) which would cover the acceptance of new technologies. 

CLEPA’s supports cumulation of origin with other countries which have already signed a FTA with the EU.

FTA negotiations should strive for worldwide harmonised and easy to handle rules of origin for all FTAs. The FTA should avoid providing only simultaneous structures for determining preferential origin, such as “a change of tariff heading” “added value rule”. The added value rule should be the primary rule. In case there is only a change of tariff heading rule or only a change of tariff heading rule in combination with an added value rule, there should always be an alternative based on an added value rule. Other variations of the rules of origin in FTAs should be avoided. Thus, a mechanism to adapt the structure of rules of origin to a changing business environment should be foreseen in the FTAs.

• Customs and trade facilitation 

CLEPA supports the streamlining of customs rules, controls and procedures in order to facilitate goods through customs and furthermore CLEPA supports the harmonisation of general rules for interpretation of the HS and General Complementary Rules of NCM. 

CLEPA supports the effective tackling of any type of “protectionist measure”, e.g. unnecessary  import  licensing  regime;  requests  for  advance  import  affidavits causing  delays  and  blockage  of  goods.  CLEPA  supports  harmonisation  of  the calculation of customs value. (Brazil has 5 methods of calculating import value, EU has 5 methods).

• Inclusion, recognition and acceptance of  remanufactured goods*,  to ensure the free trade of cores and remanufactured parts across borders. 

• Mechanism to properly protect Intellectual Property Rights, establishing a good legal framework. 

• Improving the  rules related to public tenders, customs procedures, as well as protection of intellectual property rights. 

CLEPA supports the inclusion of Venezuela and Bolivia (the latter being an Observer) as parties to the EU-MERCOSUR Agreement negotiations.