The CJEU rules that the EU is more competent than previously thought

Posted on 17 May 2017 by Brick Court

Aidan Robertson QC

In earlier blog posts (here and here) I explained that the Court of Justice of the European Union (CJEU) was due to rule on the extent of the Union’s exclusive competence to negotiate trade deals in a case in which the Commission was seeking an opinion on the EU/Singapore trade deal (Opinion 2/15) and that this would be significant for the trade deal that the UK is hoping to negotiate with the EU.

The CJEU’s Opinion was handed down on 16 May 2017. The CJEU has ruled that the extent of the EU’s exclusive competence is much broader than the Court’s Advocate General had advised in her opinion handed down on 21 December 2016. In that opinion (see https://brexit.law/2016/12/) AG Sharpston had identified several areas where the EU did not have exclusive competence, albeit none of these would likely be core to any trade deal.

The CJEU has now ruled that EU’s competence is broader than its Advocate General had advised. The only areas in the EU/Singapore free trade agreement which the CJEU identified as falling within shared competence with Member States were the fields of non-direct foreign trade investment and the regime governing dispute settlement between investors and Member States.

This means that any trade deal struck between the EU and the UK, even if it covers those two areas of mixed competence, can enter into force on the basis of provisional application even without ratification by all Member States (including regional parliaments where relevant). Member State ratification will only be required to give effect to the two areas of mixed competence, if they form part of an EU/UK agreement. This should simplify the task of negotiation of a new trade agreement.

The CJEU’s press release is here.

The CJEU’s Opinion is here.