Expanded Permissions for Ukraine's Exports to the EU
The European Union and Ukraine have recently updated their free trade agreement, which includes a robust safeguard clause designed to protect the EU market, particularly individual member states, from potential adverse effects of Ukrainian imports.
The safeguard mechanism allows both the EU and Ukraine to activate appropriate measures if imports threaten to cause disturbances or harm to domestic industries, especially in sensitive sectors such as agriculture. This clause enables the EU to conduct assessments on a member state level, meaning individual EU countries can raise concerns if Ukrainian imports begin to exert undue pressure on their markets.
The agreement aims to secure trade flows from Ukraine while safeguarding the interests of EU farmers and sensitive sectors such as sugar, poultry, eggs, wheat, maize, and honey. Market access for Ukraine will see only modest increases to prevent market disruption.
If imports cause significant disturbance, the safeguard mechanism may lead to the adoption of trade measures like temporary restrictions or tariffs. This protection is intended to safeguard EU agricultural producers from an influx of cheaper Ukrainian goods that could undermine their market position.
The agreement also includes a gradual alignment of Ukraine's production standards with EU norms, ensuring a longer-term balance. The safeguard clause provides a tool to address immediate market pressures at the member state level.
The new deal allows Ukrainian producers to export more goods to the EU. The agreement will be subject to regular reviews every five years, with the first review taking place three years after the agreement enters into force.
Dispute resolution mechanisms included in the agreement are negotiation, mediation, and arbitration. A joint committee composed of representatives from both the EU and Ukraine will oversee the monitoring of the agreement's implementation.
The new free trade agreement between the European Union and Ukraine is expected to enter into force on July 1, 2021. The agreement also includes a commitment by both parties to uphold the rules of the World Trade Organization and to promote sustainable development and environmental protection.
In addition, the agreement includes a provision for regular reviews of the agreement to assess its effectiveness and make any necessary adjustments. The joint committee will meet at least once a year to discuss the progress of the agreement and any potential issues. The safeguard clause can also be triggered if the economy and agriculture of a single EU country come under pressure from Ukrainian imports.
The safeguard clause for the EU-Ukraine free trade agreement enables individual EU countries to raise concerns if Ukrainian imports begin to exert undue pressure on their markets, particularly in sensitive sectors such as agriculture. This protection is intended to safeguard the interests of EU agricultural producers from an influx of cheaper Ukrainian goods, ensuring a balance between securing trade flows from Ukraine and protecting domestic industries.
