Beyond the Borders Service Issues

AirportIn addition to Chapter 10, other CETA chapters work in tandem to ensure support for broad-based liberalization of services trade between Canada and the EU. Chapter 9 (services market liberalization) is complemented by commitments on recognition of professional qualifications (Chapter 11) and domestic regulation (Chapter 12) and financial services (Chapter 13). We offer a few comments on Chapters 11 and 12.

Chapter 11, Mutual Recognition Agreements

Chapter 11 of CETA deals with mutual recognition of professional qualifications. It establishes a framework to support the ability of Canadian and EU professionals to have their qualifications recognized in both jurisdictions. The chapter attempts to streamline the process of the negotiation of mutual recognition agreements recognized between Canadian and EU regulators and/or professional bodies.

This chapter does not obligate involvement of professional bodies to negotiate the agreements and is completely voluntary. Agreements signed and approved under CETA, however, will apply for all Canadian provinces and territories and all EU member states. These CETA provisions introduce a new level of government engagement not previously seen in other FTAs. The provisions recognize the roles and relationships of regulators and also tailor the role of government to offer targeted support and oversight to the negotiating process. CETA marks the first time that substantive and binding provisions on the mutual recognition of professional qualifications are included in an FTA to which Canada is a party.

Chapter 12, Domestic Regulation

Chapter 12 focuses on licensing and qualification requirements and procedures of a regulatory authority to grant permission to a person to supply a service or carry out some other economic activity. It is aimed at ensuring transparent, objective, fair and timely licensing and qualification requirements and procedures in Canada and in the EU. The chapter acknowledges that domestic regulatory requirements and procedures can be lengthy, complex and unclear and thus serve as restrictions to trade. Commitments under Chapter 12 are meant to facilitate the provision of services once a border has been crossed. The key provisions focus on ensuring that the requirements for licensing are clear, publicly available and based on objective, impartial criteria. The provisions also set out that assessment of an application and granting of permission must be made in a timely and non-arbitrary manner. Qualifications procedures should be as simple as possible and only apply reasonable authorization fees. Canada and the EU have also agreed to maintain mechanisms that provide for a timely review of a decision made by a domestic regulator, should the affected service provider or investor make such a request.