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Vertical Interplay between the European Commission and Member States in EU Trade Policy

by Taro Nishikawa
This article is based on research presented at the UACES Graduate Forum Research Conference 2021 (17-18 June, online)

 

After the European Community (EC) launched the Common Commercial Policy (CCP) in 1970, the question of who influences EC/EU positions in international trade negotiations became an important scholarly research topic. On the one hand, greater control by Member States vis-à-vis the European Commission and the limited autonomy of the European Commission are stressedex-ante controls (e.g., negotiation mandates) and ex-post controls (e.g., Article 113/133 Committee, current Trade Policy Committee). On the other hand, the European Commission’s multiple sources of autonomy are pointed out—agenda-setting, agency slack, norm repackaging, and rhetoric/cognitive framing.

 

The reality of EC/EU positions in international trade negotiations might be more complicated. As Dür and Zimmermann, and Elsig point out, the influence of the European Commission and Member States can depend on the stages of trade negotiations. When issuing the mandate, the EC/EU position would be directed by Member States’ preferences, especially those with a majority in the Council (cf. a liberal intergovernmentalist approach). However, when negotiating with trading partners, the European Commission would have the ‘reframing ability’ to decide how to achieve the objectives of the Council’s mandate within a win-set of the EC/EU (cf. two-level games model). This article applies this hypothetical model of vertical interplay between the European Commission and Member States to the EC-Japan trade negotiations in the 1980s.

 

In the 1970s, the EC was hugely concerned about trade imbalances due to the ‘torrential’ export of certain manufactured goods from Japan. Many Member States made bilateral agreements with Japan to put voluntary export restraints (VERs) in place. However, in the 1980s, the EC faced new changes and challenges. Firstly, the role of the European Commission in the EC-Japan trade negotiations grew, e.g. the first EC-level voluntary export moderation on ten goods in 1983. Secondly, even though they had been concerns for the EC and the US since the 1970s, market opening and domestic structural impediments became key discussion points in international trade negotiations, especially between Japan and the EC and between Japan and the US.

 

In this context, this article focuses on the trajectory of trade negotiations concerning the EC’s request for a Japanese import target in November 1985. The idea of an import target was first introduced confidentially in the Japan-US Semiconductor Agreement in 1986. The request by the EC was the first official request for an import target from foreign countries to Japan, although it did not focus on specific products and was never accepted by the Japanese Government.

 

Since 1982, in response to the US’s and the EC’s continuing concerns, the Japanese Government introduced several market-opening measures, including tariff reductions, easing restrictions on imports, and improving the standards and conformity assessment system. In April 1985, in line with recommendations from the Advisory Committee for External Economic Issues, the Japanese Government decided to set up comprehensive market-opening measures in six areas, ‘the Action Programme for Improved Market Access’.

 

In June 1985, in response to this move, the Foreign Affairs Council stressed the necessity of ‘a clearly verifiable commitment […] to a significant, sustained increase’ in Japanese imports of manufactures and processed agricultural products in the forthcoming action programme. Moreover, according to diplomatic documents (no. 2019-1333) of the Diplomatic Archives of the Ministry of Foreign Affairs of Japan (DA-MOFAJ), during the EC-Japan summit in July 1985, then-Commissioner Willy De Clercq, in charge of external relations, requested the increase of Japanese import rates on manufactured and processed agricultural products, according to a numerically verifiable method. During a press conference after the summit, Jacques Delors, the then-President of the European Commission, also mentioned the necessity of a concrete import target. This clearly shows that both the Council and the European Commission were already requiring Japan to commit or target its imports.

 

After the Japanese Government’s announcement of ‘the Outlines of the Action Programme’ in July 1985, the European Commission’s Communication to the Council in October emphasised that Japan should set concrete and measurable targets for a significant increase in its imports of manufactured goods. Based on this communication, the Article 113 Committee and the Foreign Affairs Council discussed the EC’s relations with Japan. According to diplomatic documents of the DA-MOFAJ (no. 2016-1088, 2016-1089, 2016-1091), the majority of Member States supported the idea of requesting an import target; the UK, France, and Italy were especially proactive, and only Denmark, the Netherlands were opposed to the idea. West Germany was opposed to the idea but later accepted it reluctantly. As a result, in its conclusion, the Council instructed the European Commission to request Japan to set ‘a quantified target with a timetable for a significant increase in [Japanese] imports of manufactured goods and processed agricultural products, as a complement of its Action Programme’.

 

According to diplomatic documents of the DA-MOFAJ (no. 2016-1089), the European Commission first unofficially requested the Japanese Government to set an import target, by sharing with Japan the Council’s confidential conclusion. Interestingly, after the Japanese Government declined the request, the European Commission ‘reframed’ the Council’s mandate. Although the conclusion mentioned ‘a quantified target with a timetable’, during a meeting with Japanese then-Foreign Minister Abe, prior to the EC-Japan Ministerial Meetings, then-Commissioner De Clercq proposed a ‘complementary proposal’, the introduction of ‘a forecast of the estimated effect on imports’ of the Action Programme and ‘a Long Term Import Vision’. In November 1985, during the Ministerial Meetings, the Japanese Government officially declined this proposal due to the impossibility of a quantitative estimation of the Action Programme.

 

The above case shows that the influence of the European Commission and Member States over the EC/EU position in international trade negotiations can depend on the stage of negotiations. However, considering that the European Commission shared similar preferences with the Council before issuing the mandate, it was empirically difficult to determine the origin of the idea of an import target within the EC. To prove this hypothetical model of vertical interplay between the European Commission and Member States, it is necessary to investigate subsequent international trade negotiation cases, e.g. the EC/EU-Japan trade negotiations in the late 1980s and in the 1990s, and more recent cases such as the EU-Japan Economic Partnership Agreement (EPA).

 

 


 

Photo credit: Rob Stevens

Taro Nishikawa is a PhD candidate at the Leuven International and European Studies (LINES), the Faculty of Social Sciences, the University of Leuven (KU Leuven). His PhD project deals with European Community (EC)-Japan trade conflicts in the 1980s and the Early 1990s from a perspective of International Political Economy (IPE). His wider research interests include IPE of trade and external economic policies of the European Union (EU). As a double degree program student, he has a Master of European Studies: Transnational and Global Perspectives (M.A., Cum laude) from the University of Leuven (Belgium) in 2018, and a M.A. from Kobe University (Japan) in 2019. After getting a B.A. in Policy Management from Keio University (Japan) in 2013, he worked as an administrative officer at the Ministry of Education, Culture, Sports, Science and Technology of Japan and at the Cabinet Secretariat of Japan until 2016.

Institutional website: https://researchportal.be/en/researcher/taro-nishikawa

 


 

The European Commission’s support for the production of this publication does not constitute an endorsement of the contents, which reflect the views only of the authors, and the Commission cannot be held responsible for any use which may be made of the information contained therein.

 

 

 



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