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Is CETA a Model for EU-UK Business Migration Post-Brexit?

CETA (Comprehensive Economic and Trade Agreement) is a trade agreement between Canada and the EU.

CETA (Comprehensive Economic and Trade Agreement) is a trade agreement between Canada and the EU. It entered into force provisionally on September 21, 2017, with more than 95% of the agreement effective on that date (CETA can fully enter into force only after all EU countries have completed their ratification procedures). This means that export of goods and services between the EU and Canada should become much easier and cheaper. But the movement of goods and services also entails an increasing mobility of people. Thus, CETA has a chapter specifically aimed at regularising the ‘temporary entry and stay of natural persons for business purposes’. 

Some look at these provisions as a blueprint for Brexit. This blog post analyses these provisions and explains why they are not an adequate model for the future EU/UK relationship.

CETA’s Immigration Framework

CETA’s immigration chapter builds on the WTO (World Trade Organisation) framework and, more specifically, on the GATS (General Agreement on Trade in Services). Although only six pages long (out of 1600 in total) the ‘immigration’ section of this trade agreement reduces red tape for businesses and self-employed people and facilitates the temporary movement of labour between the EU and Canada in two ways: by smoothening the process for business migration categories and by enhancing mutual recognition of professional qualifications.

The EU-Canada agreement creates a legal framework to facilitate the entry and stay of key personnel, contractual service providers, independent professionals and short term business travellers. Key personnel refers to business visitors for investment purposes, investors and intra-corporate transferees (ICTs). All of these business migration categories have one thing in common: the temporary nature of their stay. CETA specifically excludes jobseekers and individuals aiming to apply for citizenship, residence or permanent employment.

But despite these restrictions and length limitations, CETA brings new opportunities for employers and self-employed persons. As of September 21, companies will be able to send their key personnel to the EU/Canada without facing any numerical restrictions or economic needs tests. In addition, business travellers will be able to travel to the EU/Canada for 90 days every six months without any work permits or other approval procedures. CETA also introduces rules for self-employed professionals. No numerical limitations or labour market tests will apply to them.

European and Canadian negotiators agreed to maintain some visa requirements, apparently in order to accommodate the Canadian visa waiver programme, which does not yet include Bulgaria and Romania although Canadian citizens can travel to these two countries during their 90-day visa-exempt entry into the Schengen area. However, during the ratification process, the Bulgarian and Romanian governments obtained a commitment from the Canadian authorities to lift visa requirements for their nationals by December 1, 2017.

Both businesses and people will profit from the new rules on mutual recognition of professional qualifications. CETA creates a framework to facilitate the negotiation and adoption of mutual recognition agreements. This will allow EU and Canadian professionals to practice outside of their home country without taking any additional tests or professional training.

CETA and the Future of EU-UK Migration

The CETA agreement is also extremely interesting from another perspective: it has very often been invoked as a model for the future EU-UK cooperation. Given the UK’s fixation on regaining full control over their immigration policy and avoiding the jurisdiction of European Court of Justice, it will leave the EU’s Single Market and start negotiating – most likely – a trade arrangement with the EU just like any other third country. So, CETA may indeed become a model for a future EU-UK trade agreement. But would similar rules on immigration be enough for two partners that are so intrinsically interlinked? 

As favourable as the CETA immigration rules may be, they are nowhere near the rules that will be needed between the EU and the UK to avoid major economic disruptions.

Firstly, CETA only tackles temporary migration directly linked to the free provision of services. This would limit the EU-UK movement of people for business purposes to certain categories of people (investors, intra corporate transferees (ICTs), business travellers, independent professionals) and for very limited periods of time (maximum 3 years for ICTs, maximum 90 days for business travellers, etc.). Given the geographic proximity and the interdependency of the two economies, the EU and the UK should go beyond these rules to avoid major disturbances for businesses and people. In addition, they should more legal certainty by clearly defining concepts such as business travellers at EU level and adopting a comprehensive EU list of business activities.

Secondly, CETA maintains some visa requirements. This should definitely be avoided between the EU and the UK as it would be extremely time consuming for employers, employees and people in general. In addition, favourable rules should be negotiated for UK citizens when ETIAS (European Travel Information and Authorisation System) will be in place.

Thirdly, CETA does not address long-term work-related migration. This is not surprising as EU countries maintained their ability to decide who enters their territory and, especially who may stay in the long run and under which conditions. A great deal of creativity will be required to overcome this. UK nationals, who were able to come to the EU to search for a job, take employment in one EU country and subsequently move freely and start working in another EU country, will be treated as all other third country nationals who have to fulfill the relatively strict admission criteria of the EU/national schemes. Of course, if concessions from the EU and the member states are to be found, they should be replicated by the UK with similar rules for EU nationals who want to integrate with the British labour market.

In conclusion, CETA will create new opportunities. Employers, as well as independent professionals, should seize them as soon as possible. However, a more open, ambitious and flexible model is needed for the future cooperation between the EU and the UK.

Learn more about Andreia Ghimis and our Brussels office.