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European Union (Definition of Treaties) (Strategic Partnership Agreement) (Canada) Order 2018

Volume 792: debated on Wednesday 18 July 2018

European Union (Definition of Treaties) (Framework Agreement) (Australia) Order 2018

European Union (Definition of Treaties) (Partnership Agreement on Relations and Cooperation) (New Zealand) Order 2018

Considered in Grand Committee

Moved by

That the Grand Committee do consider the European Union (Definition of Treaties) (Strategic Partnership Agreement) (Canada) Order 2018, the European Union (Definition of Treaties) (Framework Agreement) (Australia) Order 2018 and the European Union (Definition of Treaties) (Partnership Agreement on Relations and Cooperation) (New Zealand) Order 2018.

My Lords, the international agreements under consideration today have all been negotiated between the European Union and its member states on the one hand, and third countries on the other. These third countries are, of course, some of our closest partners. Each agreement provides an enhanced framework for regular political dialogue at ministerial, official and expert level.

The EU-Canada Strategic Partnership Agreement will enhance political co-operation on foreign and security policy. The agreement has been negotiated alongside the EU-Canada Comprehensive Economic and Trade Agreement, the order for which was debated in the House on 25 and 26 June 2018. The EU-Australia Framework Agreement and the EU-New Zealand Partnership Agreement on Relations and Cooperation will consolidate and strengthen co-operation in a range of sectors of mutual interest, and mark the first step towards EU-Australia and EU-New Zealand free trade agreements, for which negotiations have recently been launched.

The agreements are an important tool for promoting British and European values and standards. They have been under negotiation for a number of years, so successive UK Governments have all been involved in shaping the EU’s approach to negotiations. The EU has numerous similar agreements with other third countries around the world, all of which have passed through this ratification process in the House. So, although this is an unusual time in our relations with the EU, this is a case of business as usual—in the interests of both the UK and the EU.

Approval of these draft orders is a necessary step towards the United Kingdom’s ratification of these agreements, through designating them as EU treaties under Section 1(3) of the European Communities Act 1972.

The third countries concerned have all chosen to pursue closer ties with the European Union and its member states. The Government welcome this and we believe that by building on our shared western values—and, I must say, our shared Commonwealth values—with Canada, Australia and New Zealand, these agreements are firmly in our national interest.

As we head towards our departure from the EU, I am conscious that noble Lords may have questions about its impact on the status of these agreements and our ratification of them. I will briefly clarify the process for the benefit of your Lordships. As noble Lords will be aware, until we leave the EU on 29 March next year, the UK remains a full member state and all the rights and obligations of EU membership remain in force. During this period the Government will continue to negotiate, implement and apply EU legislation.

I am advised that it is unlikely that the agreements before us today will enter into force before the UK has left the EU. After our departure in March 2019, we will no longer be able to ratify EU third-country agreements. However, the draft withdrawal agreement includes provision that during the implementation period the UK will be treated as if it were an EU member state for the purposes of international agreements, with the effect that the UK will be bound by agreements which enter into force during the implementation period. If any of these agreements were to enter into force during the implementation period following UK ratification, the UK would not need to adopt further domestic legislation to ensure that it can apply and be bound by the agreement, in compliance with the terms of the withdrawal agreement.

Nevertheless, the impact of our departure from the EU is a peripheral issue for us today. I urge noble Lords to focus on why implementation of these agreements is firmly in our national interest. First, these agreements formalise hugely positive relationships on which the EU is embarking with third countries around the world. They seek to strengthen democratic values, the rule of law and environmental protections, and make trade and investment more predictable for businesses, including our own. It is in the UK’s interests as a leading advocate of democratic values and a rules-based international system to support the passage of these agreements.

Secondly, it is important—including for our own departure negotiations—to deliver on our Prime Minister’s commitment to continue to be a supportive EU member state until we leave. Ensuring that the UK does not block, delay or disrupt EU business as usual is crucial to that commitment.

Thirdly, as an EU member state the UK has been a key driver in all these agreements. At a time when we are strengthening ties with countries around the world, it would be wholly counterproductive to be seen in any way to be hindering the aspirations of those countries to have closer relations with the European Union. The timing of this discussion is particularly welcome in the case of Australia, whose Foreign and Defence Ministers will be our guests this week for the annual Australia-UK ministerial summit.

I welcome this opportunity to hear the views of noble Lords on these draft orders. I beg to move.

My Lords, I thank the Minister for explaining what these agreements are and the context for them. I was wondering quite how the Canada one fitted with CETA, the economic and trade agreement, but she has explained that it is complementary. She has also explained, which is useful, that this step of classifying these treaties as defined under Section 1(3) of the European Communities Act is a necessary step towards UK ratification. Perhaps she can give us an indication of what the time lag is going to be between us approving these SIs and UK ratification. I confess that I am not clear what more has to be done for the agreements to be ratified.

On behalf of my group, I have no hesitation in welcoming these agreements, which are a great success for the European Union—including, as the noble Baroness said, the fact that the UK has been a great driver of them. No doubt I am being predictable, but that shows what value the EU adds to the UK in the world and the big role that the UK can play within the EU in its international relations. It is a win-win, or rather a triple win, for the UK, the EU and our international partners that we should be in the European Union helping to forge these valuable arrangements. It is sensible that we should have talks with Canada about human rights and democracy, peace and security, and sustainable development, along with justice, freedoms and security. I am sure that the other agreements are similar. The agreement with Australia includes discussing problems around the proliferation of weapons of mass destruction, the illicit trade in small arms and light weapons and taking action against serious crime and terrorism. These are extremely valuable flanking measures or, in the case of Australia and New Zealand, preparatory measures for the free trade agreements on which the EU has launched negotiations.

The EU has just signed a very important agreement with Japan, and no doubt the UK contributed strongly to that achievement. As I say, I am not reluctant to point out that not only are these agreements welcome, but the value to the UK of being a part of the EU process with these partner countries in the developed world is a very important dimension of our EU membership.

Can the Minister say what effect any of these agreements will have on the matters covered in the White Paper concerning the continuation of international arrangements? Am I right in assuming that these agreements, because they are not economic and trade agreements, are not relevant to the aspiration set out in the White Paper to continue to take advantage of rules of origin provisions in free trade agreements? It is all about diagonal cumulation, for which I need to put a wet towel on my head. I assume that these agreements do have relevance to this area of the UK’s aspirations as regards post-Brexit arrangements because they are about political dialogue, human rights and so on.

Perhaps I may ask what is possibly an uneducated question. I have lost sight of the terminology used in the EU, but the Canadian one is a strategic partnership agreement, the Australian one is a framework agreement and the one for New Zealand is a partnership agreement without the strategic element. Does anything account for the difference in terminology? I think that the content is somewhat different in each agreement, although those for Australia and New Zealand appear to have similar coverage. According to the summary, the Canadian one is slightly different. Why is the Canadian agreement strategic while the one for New Zealand is not? Perhaps the noble Baroness will explain that to us.

To sum up, however, these are very valuable and important agreements to go alongside an economic and trade relationship. It is a pity that the Government want to leave the EU and the benefits of these agreements, which would be difficult to replicate—at least without going through a new process. Finally, will the Minister say whether these agreements will fall under the rubric of those that the UK Government will seek to roll over during the transition period—and even beyond—and to continue to take advantage of even after next March?

My Lords, my remarks have been very hastily put together because I had not intended to speak to this group of ratification processes, although I will speak to the others. I do so because of the relevance and importance of this plank of the EU-UK negotiations, in so far as it impacts security. One need look no further than the multilateral agreement for joint co-operation in signals intelligence between the UK, Canada, Australia and New Zealand, whose importance cannot be overstated. Recently the lid has somewhat come off the importance and understanding of this association. The UK, and by extension the EU, can be beneficiaries of the Five Eyes in matters of security.

I have one other point. Paragraph 7(4) of the Explanatory Memorandum refers to how the Government notified the Commons of their decision to opt in to Article 18(2) of the Canada agreement, which relates to judicial co-operation in civil and commercial matters. In the Government’s view, this falls within Title V of Part III of the TFEU, and they claim that the UK has an option to choose whether or not to participate.

If memory serves, there is an area of dispute between the UK Government and the Commission about whether or not the JHA opt-in applies in international instruments. Has the European Commission accepted that the UK can choose whether or not to participate? I am not up to date with where that disagreement got to. I seem to remember that the view in Brussels was that, as this was an international agreement, it was not covered by the opt-in arrangements for justice and home affairs, which are about internal EU arrangements. Has that argument been resolved, and has the European Commission, and perhaps the Council, accepted that the UK can choose whether or not to participate—or is their line that you lump it or leave it: you do not have an option on that aspect of the Canada Strategic Partnership Agreement?

My Lords, I thank the Minister for introducing these orders, which we support and welcome. One advantage of having this House debate these issues after the House of Commons is that I have had the opportunity to read the response of the Minister, Sir Alan Duncan, in Hansard. I will, therefore, raise questions that he refused to answer—because the Commons have much stricter rules than the Lords. They have a chair conducting these matters, who can rule things out.

These agreements cover a broad range of issues, including security and foreign affairs. Sir Alan Duncan said in the other place that that is nothing to do with these statutory instruments, but what assessment are the Government making of the effect these agreements might have on any future or existing bilateral relationships that we have? If, after Brexit, we have relationships with European countries, these important, long-term allies of this country—Canada, Australia and New Zealand—will have these agreements. I am keen to understand, especially since the Prime Minister’s Munich statement, how the Government see these future relationships, bearing in mind that there are international obligations under these treaties that might impact on any bilateral relationships we will have. I am taking the liberty of asking that question so we can better understand the Government’s approach.

My other question relates to one that has already been asked. I am not certain why these agreements have a different status. Why is it a “strategic partnership” with Canada, a “partnership agreement” for relations and co-operation with New Zealand and a “framework agreement” with Australia? Perhaps the noble Baroness can explain that in better detail and the stages to it.

Sir Alan Duncan said in the other place that these agreements will likely not apply until we have left the European Union, but stressed that it was important that we pass these regardless as part of our commitment to be a supportive EU member state. Obviously, we have obligations right up to the date that we might leave. As part of that commitment, I hope the Minister can tell us what our current role is, as part of the EU, in the EU’s preparations for the implementation of these agreements. As she said, we have been a key player in ensuring that they are negotiated and in place. The fact that we have declared that we are leaving does not mean that our obligations to push these matters forward stop. I hope the Minister can respond to that comment.

Another thing that the noble Baroness, Lady Ludford, referred to is the opportunity of the transition period. Sir Alan mentioned that we would have left before these come in, but they might come in during the transitional period. Will there be no opportunity simply to roll over these agreements? They might be a precursor to trade, but one thing people clearly will be looking at is the fact that Australia-EU bilateral trade is worth approximately £40 billion, compared with the £13 billion of UK-Australia bilateral trade. It is important to understand where Australia’s priorities will be post Brexit. How do we address that in these agreements?

I had a number of other specific questions, but they have been partly answered already in the other place. I will leave it at that for now.

I was anticipating a volley of keen interest. I am very grateful to noble Lords who have contributed to the discussion and, indeed, for the welcome that the noble Baroness, Lady Ludford, and the noble Lord, Lord Collins, have extended to these important orders. A number of questions have arisen that I shall try to deal with.

I will start with the technical question asked by the noble Baroness, Lady Ludford—and it was a very technical question about the detailed issue of the opt-in. We will endeavour to write to the noble Baroness on that, because there is not an immediate and extensive answer available to give her. I hope that she will forgive me if I deal with that in correspondence.

The noble Baroness also raised the issue of process. These SIs were considered and approved in the House of Commons just this morning, as it happens. Following approval in this House, the SIs will be considered by the Privy Council before ratification is concluded, which is most likely to be in the autumn of this year. The noble Baroness also raised a question, as did the noble Lord, Lord Collins, about the effect of these agreements; for example, on rules of origin, currently under discussion in the trade discussions. There is no connection between these agreements and rules of origin in the trade discussions. These issues will arise in discussion of the related trade agreements whenever they are negotiated and formulated.

Both the noble Baroness and the noble Lord raised the matter of the terminology being used. I understand that there is no significance in the different names for the agreements; the names were negotiated and agreed in discussion with the different partners, and they were apparently content with that nomenclature. I hope that that provides an answer.

The noble Baroness and the noble Lord raised the important issue of how all this connects with arrangements after we have left the EU. As we leave the EU, we are determined to provide as much certainty to businesses and individuals as we can. These agreements will lay the foundations of our future relationships with international partners across the world. In parallel, we are engaging with partner countries to put in place arrangements that will come into force following the implementation period, with the aim of ensuring continuity of effect of the existing agreements.

The noble Lord raised issues about dialogue with Australia. We have substantial bilateral dialogues with each of the countries covered by the orders—Australia, New Zealand and Canada. I referred to the Australian Ministers’ visit to the UK this week, which is an example of that dialogue. The Prime Minister established a number of sectoral dialogues with Canada when she visited that country last year. As has been mentioned, we co-operate very closely with them; for example, in the Five Eyes format. That co-operation will continue after we leave the EU, and these agreements provide for the EU to formalise dialogues with the partner countries.

The agreements are not yet ratified by all member states, so as yet they are not being implemented. Ordinarily, as a member state, we would be involved in preparing the EU side’s positions—and we will be a member state up until we leave. I hope that that has covered the points raised by the noble Baroness and the noble Lord. I thank them both for their helpful contributions.

As I outlined in my opening speech, these agreements will support our values and objectives long after we have left the European Union—it is important to emphasise this—and by ratifying them we are demonstrating our good will as a supportive partner of the European Union and those countries that seek to expand their relationships with the EU. The agreements are fully consistent with our prospects outside the European Union and we are enhancing our co-operation with partners across the Commonwealth as we leave the EU, in line with our ambitious vision for a global Britain.

I was very interested in the contribution of the noble Viscount, Lord Waverley, but I did not pick up on any specific questions.

I am very glad to be reassured that I am not suffering from amnesia. I did not detect any specific question to respond to but I enjoyed his contribution.

Before the Minister sits down, I want to make a point of order. As I understood it, the Privy Council will look at this after Parliament has determined whether or not to ratify it. The Minister may not immediately know the answer to this, but does that mean that Privy Council members can overrule the will of Parliament?

I suppose that may be possible, technically, but it is virtually unheard of, constitutionally. In terms of manifestly technical procedures, such as those we have dealt with today, that would be almost unimaginable, frankly. I beg to move.

Motions agreed.