Print

Content - Switzerland aims to review Japan trade treaty

  • February 09, 2018

Switzerland aims to review Japan trade treaty

Tokyo (SCCIJ) – The Swiss federal government will propose an update to the eight-year-old Agreement on Free Trade and Economic Partnership with Japan (FTEPA). This request is caused by Swiss concerns that the new EU-Japan Economic Partnership Agreement (EPA) might lead to discrimination of some Swiss exports to Japan. The EU-Japan EPA was concluded in December and may come into force in 2019. Thus, the Swiss government would like to renegotiate some parts of the FTEPA to avoid any such discrimination. But so far, the Japanese government has not shown any interest in improvements of the bilateral trade treaty.

Ms. Schneider-Schneiter

Inquiry of parliamentary group

The contentious issue came to light when Ms. Elisabeth Schneider-Schneiter, President of the Foreign Affairs Committee of the Swiss parliament and President of the Parliamentary Group Switzerland-Japan, in December officially asked the Swiss federal government about her concern of what the conclusion of the EU-Japan EPA means for Swiss companies.  

Until December, Switzerland had been for eight years the only European country with a free trade treaty with Japan. Now, Ms. Schneider-Schneiter and the Swiss Parliamentary Group Switzerland-Japan are afraid that this competitive advantage is being lost. The Group demanded that a further development of the bilateral trade treaty between Switzerland and Japan must therefore be pursued as soon as possible.  

The Swiss Federal Council answered to her inquiry quite frankly. “The EU-Japan EPA could lead to the elimination of certain competitive advantages for Switzerland or even to discrimination in certain areas such as market access for basic agricultural products and processed agricultural products,” the council said.  

Update of FTEPA to be proposed

The texts of the EU-Japan EPA have only recently been made available to the public. Accordingly, the State Secretariat for Economic Affairs (SECO) is still in the process of examining in detail the content of the agreement and its effects on the individual sectors in comparison with the FTEPA Switzerland-Japan. On the basis of the results of this analysis, Switzerland will propose to Japan, in particular at the next meeting of the Joint Committee to be held in 2018, an update of the FTEPA in the areas concerned.  

The Federal Council pointed out in its official answer to Ms. Schneider-Schneiter that Switzerland had repeatedly signaled its interest in the further development of the agreement to Japan, based on the development and negotiation clauses in the FTEPA. For the last time, at the third meeting of the Joint Committee of the FTEPA in October 2016, Switzerland proposed to Japan a targeted revision of the agreement in the fields of trade in goods, customs and trade facilitation and sustainable development.  

Unfortunately, until today, Japan had not wanted to make any changes to the FTEPA, as it is satisfied with the content and functioning of the existing agreement, the Swiss Federal Council admitted. But it promised that it would continue to actively promote the modernization and further development of the FTEPA Switzerland-Japan.

This answer may not soothe the concerns of the Parliamentary Group because from 2019, Swiss companies now have to fear that they do not have equal market access to Japan in the future as companies from the EU will have.  

Background of the FTEPA

Switzerland has had a comprehensive Free Trade and Economic Partnership Agreement with Japan since September 2009. This provides in particular for duty-free access to the Japanese market for all Swiss industrial goods. At that time, economically, this was the most important free trade agreement (FTA) signed by Switzerland since the 1972 FTA between Switzerland and the European Community. On the basis of the Customs Union Treaty of 1923 between Switzerland and the Principality of Liechtenstein, the provisions on trade in goods of the FTEPA also apply to the territory of Liechtenstein.    

 

Text: Martin Fritz for SCCIJ; Photo: Ms. Elisabeth Schneider-Schneiter spoke at the March 2017 SCCiJ Luncheon about free trade (SCCIJ)

Our Sponsors

Platinum

Gold

Silver

Partner

Footer