Canada-European Union: Comprehensive Economic and Trade Agreement (CETA)

Opening New Markets in Europe for Canada’s World-Class Services

Service industries are vital to Canada’s economy. Canada is one of the largest services exporters in the world and has significant expertise in a wide range of fields. These include management services, computer and information services, architectural, engineering, and other technical services, research and development services, and private-education services. These types of endeavours employ over 13.8 million Canadians and accounted for 70 percent of Canada’s total GDP in 2013, making it by far the largest sector in Canada.

Canada’s annual services exports to the EU were worth an average of $14.4 billion between 2011 and 2013, led by management services, research and development services, and architectural, engineering and other technical services.

Improved access to markets

  • CETA will establish greater transparency in the EU services market, resulting in better, more secure and predictable market access in areas of interest to Canada, such as professional services (e.g. auditing, architectural and integrated engineering services), environmental services, related scientific and technical consulting services, and services incidental to energy distribution.
  • Canada has negotiated the most ambitious market access commitments the EU has ever made in any of its free trade agreements. This includes, for the first time for the EU, a broad and transparent approach to market access in which every service sector is subject to the terms of the Agreement unless explicitly indicated otherwise (i.e., through a “negative list” approach).
  • The Agreement ensures that if the EU were to reduce or eliminate restrictions on foreign service providers or investors in the future, this better treatment would be locked in for Canadians (this is referred to as the “ratchet mechanism”).
  • Temporary entry provisions will provide increased transparency and predictability, facilitating movement between Canada and the EU of intra-company transferees, investors, contract service suppliers and independent professionals (including a broad coverage of professionals and limited coverage of technologists), business visitors, and others. EU commitments for temporary entry under CETA will be more extensive than any other country has received from the EU under a free trade agreement.
  • Recognition of professional qualifications is a key aspect of labour mobility. In addressing this issue, CETA’s mutual recognition chapter includes provisions that are both ambitious and innovative. Some professions in Canada and the EU have already expressed interest in engaging in discussions on mutual recognition agreements, including stakeholders representing the architecture and engineering professions.

Beyond border measures

Transparent and objective treatment by regulatory authorities is essential to the success of both Canadian and EU service providers. CETA contains provisions on domestic regulation that will facilitate trade in services by ensuring that regulatory measures related to licensing and qualification requirements and procedures are clear, publicly available, objective and impartial. For example, CETA ensures that businesses will have better access to information about the actual requirements they must fulfill before being authorized to provide their service. While recognizing the right of all governments to regulate in the interests of their citizens, CETA’s services provisions will help to ensure that government regulations are applied in a nondiscriminatory and transparent fashion.

Protecting services and policies that are fundamental to our social fabric

As in all of Canada’s international trade agreements, CETA will continue to preserve policy space for activities that are fundamental to our social fabric. Nothing in CETA prevents governments from regulating in the public interest, including for delivering public services, providing preferences to Aboriginal peoples, or adopting measures to protect or promote Canadian culture. For example, public services such as health, public education and other social services have been excluded from the obligations of CETA, ensuring that governments remain free to enact the policies and programs they choose in these areas. Similarly, CETA will preserve policy space for cultural policies and programs at all levels of government, recognizing the importance of the preservation and promotion of Canadian culture, as well as its various forms of expression.

Reaping the benefits

The EU services economy is among the largest in the world, approximately $12.6 trillion in GDP terms in 2013. The total value of services imported by the EU from around the world reached $699.4 billion in 2013. Providing Canadian service providers with better, more predictable and secure access to the EU market will allow Canadian companies to compete on a level playing field with their competitors in the EU and give them an advantage over their competitors from other countries. Ultimately, this advantage will benefit the entire Canadian economy.

In the eyes of our industry, CETA means increased demand here in Canada for construction. It means expanding companies. It means housing for new workers. And it means people have the confidence to invest in their future and in construction. Hand in hand with seeking increased trade in the Asia-Pacific and our existing free trade with the United States, freer trade with Europe will benefit Canadians and construction for decades to come.

Terrance Oakey, President, Merit Canada