Draft EU-Canada Trade Agreement Order

Part of Food Advertising (Protection of Children from Targeting) – in the House of Commons at 12:56 pm on 26th June 2018.

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Photo of Liam Fox Liam Fox The Secretary of State for International Trade and President of the Board of Trade 12:56 pm, 26th June 2018

I have set out what I believe are the principles, but the mechanism may well be different. The Commission has not yet finished its work on the technical detail of the ICS. We have reservations about the ICS as a system, but, as I have set out, we believe that there needs to be protection for investors. What we cannot do as a country is say that our investors should be protected overseas when they make investments of UK money, but a reciprocal agreement should not be in place for others. We have to ensure that this is fair and equitable, and that is what we seek to do. I have to say to the right hon. Gentleman in all candour that I am not terribly attracted by the ICS, but we want to see the detail that the European Commission comes to and, when we leave the European Union, we will want to discuss with Canada what we think, on a bilateral basis, the best disputes resolution system might be.

It is also important to note that the customary international right to regulate has been re-emphasised in this agreement. Moreover, the agreement explicitly provides that member states should not reduce their labour or environmental standards to encourage trade and investment, ensuring that our high standards are not affected by this agreement. Let me say that nothing in CETA prevents the UK from regulating in the pursuit of legitimate public policy objectives.

Such objectives include the national health service. This Government have been absolutely clear that protecting the NHS is of the utmost importance for the UK. The delivery of public health services is safeguarded in the trade in services aspects of all EU free trade agreements, including CETA. Neither will anything in CETA prevent future Governments from taking back into public ownership—should they be crazy enough to do so—any services currently run by the private sector. The legal text makes this clear, if Labour Members would like to read it, although I have to say that the fear of nationalisation is the No. 1 issue that potential investors currently give for thinking twice about future investment in the UK as a foreign direct investment destination.

In fact, robust protections in CETA are covered in a number of related articles and reservations in the text. A key article is article 9.2, in chapter 9 on cross-border trade in services, which excludes services supplied in the exercise of governmental authority from measures affecting trade in services. In addition, in annex II on reservations applicable in the European Union, the UK has gone beyond the EU-wide reservations and has included additional national reservations for doctors, privately funded ambulances and residential health facilities, and the majority of privately funded social services. The UK Government will continue to ensure that decisions about public services are made by the United Kingdom, not by our trade partners. This is a fundamental principle of our current and future trade policy.