Developments on Tripartite FTA Negotiations on Movement of Business Persons
JB Cronjé, tralac Researcher, discusses the state of negotiations on movement of business persons under the Tripartite Free Trade Area
The first phase of negotiations on the establishment of the Tripartite COMESA-EAC-SADC Free Trade Area is now in its fourth year. The Declaration Launching the Negotiations for the Establishment of a Tripartite Free Trade Area (click here to download), adopted in June 2011 at the Second Summit of Heads of State and Government of the three regional economic communities, states that negotiations shall be concluded in two phases and “the first phase will be for negotiations on trade in goods. Movement of business persons will also be negotiated during the first phase through a separate track in a committee to be established by the Tripartite Sectoral Ministerial Committee.” The second phase will cover “the built-in agenda in services and trade-related matters”. The Tripartite Sectoral Ministerial Committee established the committee responsible for negotiations on movement of business persons, Tripartite Technical Committee on Movement of Business Persons (TTC-MBP), only in July 2013. The TTC-MBP commenced with its work in September 2013.
From the start, Members of the TTC-MBP had different views on the methodology and approach to the negotiations on movement of business persons. Some Members were of the opinion that negotiations should be based on the draft Tripartite Free Trade Area (TFTA) Agreement and draft Annex on Movement of Business Persons. The text of the draft TFTA Agreement was endorsed by the fourth meeting of the Tripartite Committee of Senior Officials as the starting point for the negotiations. Other Members were of the view that negotiations on movement of business persons should not form part of the text based negotiations of the draft TFTA Agreement for trade in goods. In their opinion the outcome of any negotiation process on movement of business persons will not result in an Annex to the TFTA Agreement, but a separate stand-alone agreement.
Recent reports suggest that political guidance on the matter was provided and that Members agreed to develop a separate legal instrument to facilitate the movement of business persons. The draft Annex on Movement of Business Persons provided for unrestricted market access for business persons engaged in trade in goods, the provision of services, or the conduct of investment activities including business visitors, traders and investors, professionals and intra-corporate transferees. Negotiations on these terms seem to have been swept off the table. The TTC-MBP held its third meeting at the beginning of November 2014 and discussions on a separate draft agreement on movement of business persons have ostensibly started and are ongoing.
Negotiations on a separate agreement on movement of business persons will need to be conducted within the existing negotiating framework endorsed by the last Summit in June 2011. Consistent with the Declaration Launching the Negotiations for the Establishment of a Tripartite Free Trade Area and guided by the Tripartite FTA Negotiating Principles, Processes and Institutional Framework (click here to download) negotiations can proceed on a separate track and parallel to the negotiations on trade in goods.
An important negotiating principle ensuring the conclusion of comprehensive trade agreements, as the envisaged TFTA, is that of a single undertaking. It means that negotiations on various matters proceed simultaneously, not sequentially, and all Members must accept all the results. However, the agreed Tripartite FTA Negotiating Principles, Processes and Institutional Framework guiding the TFTA negotiations provide only for such principle “covering Phase 1 on trade in goods”. It means that negotiations on all the elements constituting the trade in goods agenda will result in a single TFTA agreement that will be open for acceptance as a whole. However, such an agreement will exclude movement of business persons, trade in services or the issues on the built-in agenda. The absence of a single undertaking applicable to the conclusion of all aspects of the negotiations permits fragmentation of the negotiating agenda and allows for the conclusion of self-governing agreements on trade in goods, the movement of business persons, trade in services, and any trade-related matter. Not all Members might be equally enthusiastic about undertaking commitments beyond those relating to trade in goods anytime soon. Negotiations on these issues could be drawn out for years after the conclusion and implementation of a free trade agreement on trade in goods.
Negotiations on movement of business persons and other matters must presumably be guided by the remaining principles of variable geometry; flexibility and special and differential treatment; transparency; building on the acquis of the existing regional economic communities; substantial liberalisation; most favoured nation treatment; national treatment; reciprocity; and, decision-making by consensus. These negotiating principles obviously need to be rationalised and defined by the Members to suit a particular negotiating context. Will or has this been done for the negotiations of movement business persons?
A number of other questions relating to the negotiation of a separate agreement on movement of business persons could be raised. What will be the objectives of the legal instrument? What is a business person? Assuming that the purpose of the agreement is to establish simple and transparent administrative requirements and procedures to facilitate the temporary entry, stay and exit of (business) persons, what period of time will they be permitted to stay in the territory of another Member and could this period be extended? Will persons be granted visas upon arrival or will visa applications at least be processed within a specific timeframe? What mechanisms will be put in place to verify the status of an application? Will visas be issued gratis or will fees and charges relating to visa applications at least be limited to the cost of delivering the service? Will each Member be required to publish information, documents and forms regarding their requirements for temporary entry? What recourse will an individual have if an application is rejected or not timeously processed? Mechanisms must be in place to prevent arbitrary administrative decision-making. Decisions relating to the acceptance or refusal of applications are administrative in nature and competent authorities are better placed to resolve such matters. What legal and administrative arrangements will Members put in place to establish and ensure continued cooperation and communication among competent authorities on a day-to-day basis? How will Members go about streamlining and simplifying requirements and procedures? Members should ideally be required to regularly report to other Members on their legal and administrative frameworks with a view to review, evaluate and recommend changes. Adopting a common method of structuring information makes reporting manageable and comparable and highlights possible best practices. Moreover, it could serve as basis for developing simplified procedures, standardised documentation and harmonised requirements for the movement of business persons. These and many other issues need to be considered to conclude a workable and implementable agreement that will facilitate trade, investment and overall business development in the Tripartite FTA region.