PART II: ECONOMIC PART 1. OBJECTIVES AND PRINCIPLES

16. The envisaged partnership should include an ambitious, wide-ranging and balanced economic partnership. This partnership should be comprehensive, encompassing a free trade agreement as well as wider sectoral cooperation where it is in the Union interest. It should be consistent with the applicable World Trade Organization (WTO) rules, notably Articles XXIV of the General Agreement on Tariffs and Trade (GATT) and Article V of the General Agreement on Trade in Services (GATS), and ensure that all levels of government effectively comply with its provisions. It should include provisions on fisheries, as set out in Section 12 of this Part, in particular paragraph 85, and be underpinned by robust commitments ensuring a level playing field for open and fair competition, as set out in Section 15 of this Part, as well as by effective management and supervision, dispute settlement and enforcement arrangements, including appropriate remedies. It should facilitate, to the extent possible, trade and investment between the Parties, while respecting the integrity of the Union’s Single Market and of its Customs Union.

17. The envisaged partnership should recognise that ensuring sustainable development is an overarching objective of the Parties. The economic partnership should ensure that the Parties retain their autonomy and the ability to regulate economic activity according to the levels of protection each deems appropriate in order to achieve legitimate public policy objectives such as public health, animal and plant health and welfare, social services, public education, safety, the environment including fight against climate change, public morals, social or consumer protection, privacy and data protection, and promotion and protection of cultural diversity and the fight against money laundering.

ublic consultations on significant new regulations or significant reviews of existing measures.

3. SERVICES AND INVESTMENT

A. Objectives and principles

32. The envisaged partnership should include ambitious, comprehensive and balanced provisions on trade in services and investment in services and non-services sectors, respecting each Party’s right to regulate. These provisions should aim to deliver a level of liberalisation in trade in services beyond the Parties’ WTO commitments and taking into account existing Union free trade agreements.

33. In line with Article V of the General Agreement on Trade in Services (GATS), the envisaged partnership should aim at substantial sectoral coverage, covering all modes of supply and providing for the absence of substantially all discrimination in the covered sectors. The envisaged partnership should provide for exceptions and limitations as appropriate, including the exclusion of activities carried out in the exercise of governmental authority. Audio-visual services should be excluded from the provisions related to liberalisation. The high quality of the Union’s public services should be preserved in accordance with the Treaty on the Functioning of the European Union and in particular Protocol No 26 on Services of General Interest, and taking into account the Union’s reservations in this area, including in the GATS. The provisions on services and investment should cover sectors such as professional and business services, telecommunications services, courier and postal services, distribution services, environmental services, financial services and transport services.5

B. Market access and non-discrimination

34. The envisaged partnership should include provisions on market access and national treatment under host state rules for the Parties’ service providers and investors, as well as address performance requirements imposed on investors.

35. It should include provisions that would allow for the entry and temporary stay of natural persons for business purposes in defined areas. However, nothing in the envisaged partnership should prevent the Parties from applying their national laws, regulations and requirements regarding entry and stay, provided that, in doing so, they do not nullify or impair the benefits accruing from the envisaged partnership. The laws, regulations and requirements existing in the Union regarding working conditions and workers’ rights should continue to apply.

C. Regulatory aspects

36. While preserving the regulatory autonomy of the Parties, the envisaged partnership should include provisions to promote regulatory approaches that are transparent, efficient, compatible to the extent possible, and which promote avoidance of unnecessary regulatory requirements.

37. In this context, the envisaged partnership should cover disciplines on domestic regulation. These should include horizontal provisions in line with Union practice in free trade agreements, such as on licensing procedures, and regulatory provisions in line with existing Union free trade agreements in specific sectors such as telecommunication services, financial services, delivery services, and international maritime transport services. 5 In respect to certain transport services, see also section 10 below.

38. The envisaged partnership should reaffirm the Parties’ commitment to providing, through sectoral provisions in telecommunication services, for fair and equal access to public telecommunication networks and services to each other’s services suppliers and address anticompetitive practices.

39. The envisaged partnership should establish a framework for voluntary regulatory cooperation in areas of Union interest, including exchange of information and sharing of best practice.

40. The envisaged partnership should include cross-cutting disciplines on good regulatory practices and transparency for the development and implementation of efficient, cost-effective regulations for services and investment, including early public consultations on significant new regulations or significant reviews of existing measures.

41. The envisaged partnership should also include a framework for negotiations on the conditions for the competent domestic authorities to recognise professional qualifications necessary to the pursuit of specific regulated professions, where in the Union’s interest.

4. COOPERATION ON FINANCIAL SERVICES

42. The envisaged partnership should reaffirm the Parties’ commitment to preserving financial stability, market integrity, investor and consumer protection and fair competition, while respecting the Parties’ regulatory and decision-making autonomy, and their ability to take equivalence decisions in their own interest. This is without prejudice to the Parties’ ability to adopt or maintain any measure for prudential reasons. The key instrument the Parties will use to regulate interactions between their financial systems will be their respective unilateral equivalence frameworks.

43. The cooperation on financial services should establish close and appropriately structured voluntary cooperation on regulatory and supervisory matters, including in international bodies. This cooperation should preserve the Union’s regulatory and supervisory autonomy. It should allow for informal exchange of information and bilateral discussions on regulatory initiatives and other issues of interest, for instance on equivalence. It should ensure, where possible, appropriate transparency and stability of the cooperation.

5. DIGITAL TRADE

44. In the context of the increasing digitalisation of trade covering both services and goods, the envisaged partnership should include provisions aiming at facilitating digital trade, addressing unjustified barriers to trade by electronic means, and ensuring an open, secure and trustworthy online environment for businesses and consumers, such as on electronic trust and authentication services or on not requiring prior authorisation solely on the grounds that the service is provided by electronic means. They should also provide for consumer protection in the online environment and on unsolicited direct marketing communication. These provisions should address data flows, while not affecting the Union’s personal data protection rules.

45. The envisaged partnership should provide for cooperation in multilateral and multistakeholder fora in areas of mutual interest, and establish a dialogue to exchange information, experience and best practice relating to emerging technologies.

6. CAPITAL MOVEMENTS AND PAYMENTS

46. The envisaged partnership should include provisions to enable the movement of capital and payments related to transactions liberalised under the envisaged partnership. It should entail safeguard and carve-out provisions (for example, concerning the Union’s economic and monetary union and balance of payments), which should be in accordance with the Treaty on the Functioning of the European Union on free movement of capital.

7. INTELLECTUAL PROPERTY

47. The envisaged partnership should provide for the protection and enforcement of intellectual property rights to stimulate innovation, creativity and economic activity, going beyond the standards of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) and the World Intellectual Property Organization (WIPO) conventions where relevant.

48. The envisaged partnership should preserve the Parties’ current high levels of protection of intellectual property, such as copyright and related rights, trademarks, unregistered and registered design rights, geographical indications, patents, undisclosed information or plant variety rights. The envisaged partnership should confirm the protection of existing geographical indications as provided for in the Withdrawal Agreement and establish a mechanism for the protection of future geographical indications ensuring the same level of protection as that provided for by the Withdrawal Agreement.

49. The envisaged partnership should also ensure the effectiveness of enforcement of intellectual property rights, including in the digital environment and at the border.

50. The envisaged partnership should establish an appropriate mechanism for cooperation and exchange of information between the Parties on intellectual property issues of mutual interest, such as respective approaches and processes regarding trademarks, designs and patents.

8. PUBLIC PROCUREMENT

51. Noting the United Kingdom’s envisaged accession to the WTO Government Procurement Agreement (GPA), the envisaged partnership should provide for mutual opportunities in the Parties’ respective public procurement markets based on the United Kingdom’s access offer for accession to the GPA and beyond their commitments under the GPA in specific areas, without prejudice to their domestic rules to protect their essential security interests. These areas should include relevant procurement not covered by the GPA such as procurement in the utilities sectors not covered under the GPA. National treatment should ensure treatment no less favourable than that accorded to locally-established suppliers or service providers.

52. The envisaged partnership should commit the Parties to standards based on and going beyond those of the GPA ensuring transparency of market opportunities, public procurement rules, procedures and practices. Building on these standards, the envisaged partnership should address the risk of arbitrary behaviour when awarding contracts, and make available effective and accessible remedies and review procedures, including before judicial authorities.

9. MOBILITY

53. Mobility arrangements, including on visa-free travel for short-term stays, in the envisaged partnership should be based on non-discrimination between the Union Member States and full reciprocity.

54. The envisaged partnership should aim at setting out conditions for entry and stay for purposes such as research, study, training and youth exchanges.

55. The envisaged partnership should address social security coordination, having appropriate regard to future movement of persons. 56. Any provisions should be without prejudice to the Common Travel Area (CTA) arrangements as they apply between the United Kingdom and Ireland, as referred to in Article 38(2) of the Withdrawal Agreement and in Article 3 of the Protocol on Ireland/Northern Ireland.