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Japan: Renewed expectations, progress hinges on CJEU decision on mixed agreements

The European Commission is still engaging with its Japanese counterparts on a weekly basis at technical level. Each side is still working on developing new offers for tariffs and rules of origin. Textiles still have not been discussed specifically in any context.

The Japanese side has expressed anxiety in relation to potential ratification hurdles a deal could face, such as the events that unfolded in the CETA saga. Commissioner Malmström was quoted in the Financial Times saying that “a breakthrough by the end of 2016 or the beginning of 2017 was still in prospect”.

The sticky points in the negotiations relate to automobile industry regulation, EU agricultural exports to Japan, and the EU push for an investment court system. Crucially, the EU will only be able to make its case for the FTA once the European Court of Justice will have issued its ruling due early next year on the trade deal with Singapore, which will determine whether it is a mixed agreement or not. The Advocate General has released her opinion, stating that certain aspects of the agreement should have mixed competences between the EU and the member states. Although this opinion is not binding, it is important to see whether the official ruling mirrors this opinion.

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