CETA was one of the first comprehensive trade agreements negotiated by the European Commission on behalf of the EU member states, following the 2009 Treaty of Lisbon that expanded the EU’s competence in trade policy (Article 3(1) TFEU). The Commission presented CETA as a “mixed agreement”, meaning that it exceeds the scope of the EU’s exclusive competency over trade matters. To fully enter into force, mixed agreements require national ratification in all EU member states. The Court of Justice of the European Union (CJEU) clarified the scope of the European Commission’s exclusive competency in the context of an agreement with Singapore, indicating that the only provisions outside the scope of the EU’s exclusive competences concerned portfolio investments and the dispute settlement mechanism for investment disputes.
The provisions on investor-state dispute settlement make CETA a “mixed agreement”, as it covers investments and includes a dispute settlement mechanism. This mechanism has been one of the most contentious issues in the ratification process. Many political parties and civil society organizations (CSOs) opposing CETA’s ratification argue that the proposed system for investor-state dispute settlement gives multinational corporations (MNCs) the power to sue member state governments and prevents them from legislating new regulations on the environment, labour, workers, and consumer rights, as well as health and food safety policy. This has been described by opponents as “regulatory chill” and a “parallel justice system”, where MNCs and individuals are treated differently.
In addition to investment, food safety and its effect on health policy in each member state has been a very contentious and politicized topic throughout the CETA negotiation and ratification processes. Agricultural practices in Canada differ from those in the EU, as Canada permits the use of certain genetically modified organisms (GMOs), hormones, pesticides and herbicides, and animal meal that are banned in the EU. It is argued by opponents of CETA that these agricultural products violate the EU’s precautionary principle and will harm EU member state citizens’ health and the overall healthcare system.
Economic interests have been intricate to opponents and proponents in the framing of CETA’s ratification. Opponents largely include agricultural interests, especially in the beef and dairy industries, but also in the fruit and vegetable sectors. Opponents argue against Canada’s supply-management system and beef and dairy quotas that prevent European farmers from accessing the Canadian market. There are also opponents arguing CETA will harm their country’s industrial base, especially in the automobile industry, as there were fears that big U.S. automakers would be able to enter the EU market through a backdoor.
Another contentious topic are geographical indications (GIs) and their associated trademarks. A GI is a product that has specific geographical origins as well as qualities and/or a reputation due to that origin. Examples include Champagne and Prosciutto di Parma. This means that sparkling white wine made outside of the Champagne region in France cannot be called Champagne. Although CETA does recognize the vast majority of the EU’s GIs, there are some that have not been given the designation. These include many specialty foods and dairy products.
The access to public procurement contracts has also been contentious, as some CETA opponents argue that through liberalization and privatization, MNCs will cause an adverse effect on public services; these include telecommunications, energy, and utility services. The main argument is that the liberalization of public procurement through CETA prevents governments from prioritizing local companies familiar with local conditions.