How to read a trade agreement

EU trade agreements may seem complicated documents, but they are based on an easy-to-follow logical structure. Below is the standard basic structure of a trade agreement to help you find the information for your particular trade activity. This is a general guideline. Each agreement is different, depending on the situation of the signatory parties and their level of ambition trade liberalisation.

1. Preamble

The preamble identifies the parties, confirms their common objectives for the development of their economic relations and acknowledges the basis of those relations.

2. Definitions, objectives and initial provisions

This chapter explains the terms used in the agreement in order to ensure a common understanding of the language.

3. National treatment and market access for goods

This chapter and its annexes usually describe to what extent and how quickly the agreement will reduce or eliminate duties for goods traded between the parties. Here you will find the tariffs for all goods covered by the trade agreement. There is usually a separate annex with specific commitments made by each party for each category of goods.

4. Trade remedies

This chapter refers to counter measures that a party may take in response to the negative effects of unfair trade practices, such as dumping and illegal subsidies.

5. Technical Barriers to Trade

This chapter provides for the harmonisation of certain regulations and the recognition of the equivalence of certain quality certification procedures in specific sectors. It may provide for the mutual recognition of conformity assessment procedures, i.e. products may be accepted for import in the country of destination on the basis of conformity assessment documents issued in the exporting country.

6. Sanitary and phytosanitary measures

This chapter lays down the rules on food safety, animal health and plant health. The general aim is to simplify and harmonise compliance procedures and to ensure that legitimate food safety and animal and plant health measures do not create unjustified barriers to trade. Here you will find the competent authorities in each country and the approval mechanisms that you need to comply with to export.

7. Customs and trade facilitation

This chapter aims to streamline customs procedures and make them more efficient. You will find customs procedures not covered elsewhere, documentation requirements and methods for determining compliance with rules of origin, as well as information related to customs valuation and fees, and your right to appeal against customs decisions.

8. Investment

This chapter sets out measures to open up investment and protect investors by ensuring their fair treatment. It could remove foreign equity caps or performance requirements, facilitate the transfer of profits, and establish stable and predictable rules for investment guarantees. It could also establish investment court systems to allow investors to resolve investment disputes with governments quickly and fairly.

9. Trade in services

This chapter deals with cross-border trade in services. It follows in part the structure of the General Agreement on Trade in Services (GATS), which sets the rules for trade in services between all WTO members. However, trade agreements often contain additional commitments in areas such as financial services, telecommunications, e-commerce and the temporary movement of natural persons. Specific commitments may be contained in annexes, with a separate schedule for each of the parties.

10. Government procurement

This chapter sets out the areas in which companies from each side may supply goods and services to each other's governments, including central, regional, provincial and local administrations. Where the parties are already members of the WTO Government Procurement Agreement (GPA), the trade agreement may deepen the commitments in terms of the number of procurement entities covered, the number of goods and services covered, and the value thresholds for tender eligibility.

11. Intellectual property

This chapter usually builds on existing international intellectual property (IP) conventions and outlines procedures and rules regarding copyright, trademarks, designs, patents, data protection, etc. It could also define new areas of collaboration, such as the protection of geographical indications.

12. Competition and related matters

This section usually refers to competition law, investigations and sanctions related to trade cartels, abusive behaviour by companies with a dominant market position, and anti-competitive mergers. It may also include rules on subsidies, state-owned enterprises and enterprises granted special privileges, to ensure a level playing field for private companies.

13. Dispute settlement and mediation

This chapter sets out a system for resolving any disputes about the way in which the parties apply or interpret the agreement and mentions the formal procedures to be followed by both sides if they cannot reach agreement through mediation.

14. Final provisions

This chapter usually sets out how the agreement will enter into force, provides for the possibility of new parties to join the agreement after it has been signed and sets out the procedures for amending the agreement in the future.

15. Other protocols

This may contain relevant information not included elsewhere such as specific rules of origin for each product category.