MFA: Trade Agreement between the EU and Canada CETA enters into force

MINISTRY FOR FOREIGN AFFAIRS
http://formin.finland.fi/english

Press release 161/2017
20 September 2017

Trade Agreement between the EU and Canada CETA enters into force

The provisional application of the Comprehensive Economic Trade Agreement (CETA) between the EU and Canada starts on 21 September 2017. Finnish companies will be able to take advantage of the Agreement in their trade with Canada.

CETA will eliminate tariffs on all industrial products either immediately or within a transition period of no longer than seven years. The changes will become effective immediately when the provisional application starts. European exporters to Canada need to register to benefit from the preferential tariff treatment under CETA.

“Finnish companies will stand to benefit from CETA because it eliminates tariffs and opens up the Canadian services market. I will be visiting Canada in October together with a Finnish business delegation, and I have high expectations for increased trade between our countries. The Agreement is also an important signal of the opportunities of free trade,” says Minister for Foreign Trade and Development Kai Mykkänen.

Products’ double testing for EU and Canadian markets will be reduced and companies will enjoy marked savings. The Agreement will expand European companies’ opportunities of participation in the public contracts market of Canadian provinces and big cities.

Finnish companies will have new opportunities in environmental and transport services, for example. CETA also eliminates means testing for entry into Canada in a number of Finland’s export sectors, such as engineering and IT services. It will be easier for European firms to invest in Canada. Smaller investments amounting to less than CAD 1.5 billion will be exempt from scrutiny by Canadian authorities.

VATT Institute for Economic Research is currently conducting research on the effects of CETA. According to its preliminary estimates, the economic effects of CETA would be slightly greater in Finland than in the EU Member States on average. Preliminary results also indicate that CETA would especially promote Finland’s services export.

In 2016, the Finnish exports of goods to Canada amounted to EUR 400 million and imports to EUR 435 million. In 2015, Finland exported services to Canada to the value of EUR 269 million, while Canada imported services to Finland to the value of EUR 62 million.

The provisional application is based on the provisions of CETA and the Treaty on the European Union. This is a customary arrangement, according to which a treaty or its part can be applied provisionally prior to its entry into force. However, the provisional application concerns only provisions that fall under the competence of the EU. The investment court system under CETA will remain outside the provisional application.

The Comprehensive Economic Trade Agreement enters into force in full only after it has been adopted by all EU Member States, including the Finnish Parliament. The government proposal is due to be submitted to Parliament in October 2017.

Inquiries: Pasi-Heikki Vaaranmaa, Director, tel. +358 295 351 700, and Mary-Anne Nojonen, Commercial Counsellor, tel. +358 295 351 494, Trade Policy Unit

The Foreign Ministry's email addresses are of the format firstname.lastname@formin.fi.