WTO, World Trade Organisation

World Trade Organization headquarters in Geneva (Photo: World Trade Organisation)

WTO, World Trade Organisation

United Nations` specialised international organisation for trade. 

The WTO, which replaced GATT, is tasked with organising world trade on free trade principles. 

The EU is represented in WTO trade talks by the EU Commission. The member states are also represented in WTO but each member state is bound to support the common EU position in the areas where the EU has an exclusive competence as in most trade. 

If a WTO agreement contains parts where the EU is not fully competent agreements can be co-signed by the member states. In 1994, the EU Court decided that the EU was not fully competent for all parts of intellectual property rights. Then, the member states had to co-sign the full agreement. 

This difficulty was eliminated by the Nice Treaty. However, the Nice treaty still raise difficulties for parts of trade in some sensitive services. The Lisbon Treaty has eliminated these remaining difficulties as the Nice Treaty eliminated the difficulties for intellectual property rights. 

Most EU positions are adopted by qualified majority. The Treaty of Lisbon calls for the use of qualified majority voting in all international agreements where the internal decisions relating to them are agreed by a qualified majority

This principle is not new. It was decided by the Court in the AETR verdict. But the principle may now be used in many more areas because the Lisbon Treaty widen the scope for EU regulation and introduce 49 new areas with qualified majority voting where the member states can no longer veto joint legislation. 

The internal competences has increased and these expansions has automatically been followed by a parallel increase of the external competences of the new Union.

The new derogations are very narrow for trade in health, education and services. The rule is qualified majority but then a member state can call for the use of a safety clause. It is not a general veto right.

A member state can only call for unanimity if the international agreement "risk seriously disturbing the national organisation of such services". 

The member state must be able to prove that before the Commission and the Council of Ministers.  

The Lisbon Treaty offers the EU exclusive competence in all "common commercial policy" with the new Article 3 TFEU. The common commercial policy is a wider concept than trade, which have been developed into almost an exclusive EU competence.

The Lisbon Treaty also offers the EU legal personality with Article 47 TEU allowing the EU to enter into all kind of international agreements where the EU decide internally. The agreements are entered into according to Article 207, 212.3 and 218.8 TFEU. 

There are no limits in Article 216.1 TFEU defining the scope for international agreements entering into by the EU as long as the EU has the the internal competence. 

The Lisbon Treaty also explicitly extend the scope for trade agreements to include direct foreign investments and trade with intellectual property, see Article 206 and 207 TFEU. 

It is difficult to find areas where the EU should not be able to enter into WTO agreements without decision by qualified majority or/and a requirement for co-signatures by the member states. 

Trade in a very little part of transport services may still be an exemption where it is possible to require unanimity. However, even this exemption can also be deleted by a unanimous decision among prime ministers using the new proposed method for simplified treaty amendment in Article 48.6 TEU. 

The Lisbon Treaty offers the European Parliament a greater say in trade agreements. The Parliament will have to vote for the most important agreements for them to enter into force. The Parliament must approve with absolute majority of members, which was 376 of 751 MEPs from July 2014.