Acting in harmony on world trade

Date: 16/01/1997

All the world may be a stage, but the European Union gives its most rousing performances when the scene is one of trade and commerce.

Sometimes it plays the part of the sweet suitor, cajoling a reluctant beloved (Beijing or Tokyo) to open its markets. But it is often seen as playing the role of troublemaker, complaining at the World Trade Organisation in a bid to protect its own markets (agriculture and films) or protesting about other countries' trading practices.

Be it trade in beef, soya beans, telecommunications equipment or T-shirts, the Union makes its voice heard.

But who is it exactly sparking 'trade wars' and striking the 'global' deals?

The 113 Committee, which takes its name from the article in the Treaty of Rome which established it, was created in 1961 and has its august status by virtue of the fact that it is expressly mentioned in the treaties (along with the Committee of Permanent Representatives, the Monetary Committee, the Political Committee, the Transport Committee and the K4 Committee dealing with justice and home affairs).

Indeed, the 113 Committee has its own chapter in the treaty the one devoted to the goal of implementing a common commercial policy (CCP) through which EU member states conduct their trade with foreign countries.

That goal is not merely a foreign policy aspiration it is seen as a vital extension of the single market: if goods from abroad are to have the same access to Spanish and Swedish markets, then Spain and Sweden should have the same export policies for their own goods.

However, the CCP is also a tool of foreign policy and has had more success than the Union's other joint external policies.

The EU treaties give the European Commission the power to negotiate trade accords with third countries and represent the 15 Union nations in multilateral trading fora, but the Council of Ministers has the final power to conclude an agreement once it has been negotiated.

But as they are negotiating, Commission officials are effectively making trade law for EU member states.

The 113 Committee is the bridge between those negotiators and national trade policy-makers in Union capitals. Formally, it is part of the Council of Ministers and has no decision-making powers. But if it is the Commission which paints on the canvas, it is the 113 Committee which determines the size of the canvas and lays down the primary layers.

Committee members inform the Commission of changing positions in national capitals on the issues at hand. They watch Commission negotiations, warn negotiators when their tactics are losing support in capitals and guide them back into the waters of the acceptable.

“When the Commission's trajectory is not to member states' liking, it is our job to redress it,” said one committee member.

But members insist this does not always make them feel like coachmen reining in the Commission's wild horses, saying instead that they work well together.

Commission experts on a huge range of subjects are included in the weekly 113 meetings. “Sometimes you see 25 people at the other end of the table,” said a member.

The result is that “before it goes to negotiate, the Commission knows the limits of the exercise”.

Before it can negotiate any trade accord, the Commission needs a mandate. While that mandate comes officially from ministers, it is drafted in the 113 Committee.

Throughout negotiations, the Commission regularly checks in with 113, reports the state of play and is given an indication of whether member states are likely to approve.

“The Commission knows what they can sell abroad and, after meeting us, it has a feel for what is possible to achieve inside the Union.”

When the negotiators return home after doing battle, they present the accomplished deal to the committee, which informally approves or rejects the accord and sends its opinion to ambassadors, who go through the same process before sending the deal to ministers for formal approval.

On occasions, the committee is blamed for slowing down progress in trade negotiations by forcing the negotiators to stop in mid-talks to come home and bargain with it. “Sometimes I get the feeling the members forget there is an outside world and they ask the Commission to do impossible things,” said one.

Members themselves admit that they put negotiators in “the impossible situation of having to broker with us and still face the other country's negotiators”.

But the process may gain time and save the Union a lot of face in trade circles at the end of negotiations, because the Commission team is less likely to have its work rejected by ministers.

“It leads to much more efficiency in international circles and it focuses the mind,” said another member.

Sometimes it takes quite a long time to get an agreement inside the committee. As in other EU fora, the tradition in the committee is to try to reach a consensus and most of the time it succeeds.

Because some trade areas (such as services, investment and intellectual property) are decided by member states rather than the Commission negotiators, the 113 Committee must agree unanimously in those fields.

Committee members are anxiously awaiting the result of the Intergovernmental Conference for the outcome of an emotional EU debate over whether agreements in those fields may in future be reached by majority vote instead of unanimity.

But in the classical trade context, a qualified majority is already enough and although the goal is not to have to vote, it does happen occasionally, as it did last spring when members overruled Spain and Italy over the compensation the Union would pay Argentina for changing import tariffs when Austria, Finland and Sweden became members.

No group is better placed to hammer out EU trade policy, composed as it is of the directors of foreign trade in all 15 member state capitals, each of whom has long experience in trade matters.

Because trade experts are more technicians than diplomats, the committee does not have the flashy reputation that the Political Committee (PoCo) enjoys. Although many 113 members carry ambassador rank (in some member states, trade falls in the domain of the foreign ministry), many are officials in their countries' finance ministries and are viewed more as technocrats than prestigious dinner partners.

Like PoCo, however, their meetings establish a fraternity between the national trade chiefs. “It is a committee where personal relations are important,” said a member.

Those friendships influence national policy, as members are sometimes swayed by their colleagues' opinions. One Danish member remembers the day he arrived at the meeting with strict orders, listened to his colleagues, changed his mind and rang home to apologise. In the end, Copenhagen agreed with him.

The 113 Committee is a key factor in the strength that Trade Commissioner Sir Leon Brittan talks about when he says the EU has a real role on the world stage because of its trading weight. Union negotiators are respected for the fact that they represent 15 rich and powerful European nations.

At last month's WTO ministerial meeting in Singapore, the 113 group drafted a platform for the Union's position at the meeting which was approved by EU ministers and presented to some 120 nations as the Union stance.

“This platform allowed the Community to move at Singapore on some highly sensitive issues. It is real, effective work,” said a member.

“Because we face the rest of the world, we have to agree among ourselves. We cannot afford to show discord. Our partners know that there are varying tendencies and they are tempted to exploit sensibilities inside the EU.”

Those sensibilities certainly exist. The committee often faces the classic EU problem in trade questions the divide between the 'free traders' and the 'protectionists'. In the 113 Committee, those divisions are ironed out to present as seamless a position as possible to ambassadors and ministers.

“The north-south division is there, but the division is not always where you think it is,” said a Nordic member. For instance, on trade and labour standards issues, Denmark teams up with France and Portugal, instead of with its traditional partners, the UK and Germany.

“The Spanish are the most difficult in liberals' eyes, but if we can support Spain without harming our own interests, we will always do it,” said one Scandinavian diplomat of his southern colleagues, adding: “There is a strange solidarity among us.”