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Deep and not comprehensive? What the WTO rules permit for a UK-EU FTA

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posted on 2023-06-09, 13:23 authored by Emily LydgateEmily Lydgate, L. Alan Winters
WTO rules prohibit Free Trade Areas (FTAs) that provide tariff-free access or services liberalization in only one or a few sectors. In this sense, a narrow, sectoral approach to concluding an FTA between the EU and the UK would contravene WTO law. However, assuming the EU and the UK were able to agree a substantially broad tariff-free FTA, WTO rules would not prevent them from moving further to maintain the bulk of the benefits of the Customs Union and the Single Market in a few key sectors. They could establish customs union-like conditions by coordinating external tariffs in some sectors and agreeing on relaxed Rules of Origin (RoOs) administered lightly and Single Market-like access could be approximated through sectoral Mutual Recognition Agreements. Such an approach would enable continued deep integration, whose desirability has been signalled on both sides. It would fall short of current market access levels even in the selected sectors, and, in the case of tariff coordination, re-create some of the limits to an independent trade policy that Brexit aimed to remove. If the trade-off were deemed desirable, however, the approach could be reconciled with WTO rules including the ‘Most Favoured Nation’ requirement that equal treatment be awarded to all WTO Member States.

History

Publication status

  • Published

File Version

  • Accepted version

Journal

World Trade Review

ISSN

1474-7456

Publisher

Cambridge University Press

Issue

3

Volume

18

Page range

451-479

Department affiliated with

  • Law Publications

Research groups affiliated with

  • Sussex Sustainability Research Programme Publications
  • Sussex European Institute Publications

Full text available

  • Yes

Peer reviewed?

  • Yes

Legacy Posted Date

2018-05-21

First Open Access (FOA) Date

2018-05-21

First Compliant Deposit (FCD) Date

2018-05-21

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