Canada, EU release text of trade deal; play down German objections

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Canada and the European Union played down last-minute objections from Germany as they unveiled the final text of a sweeping trade deal that could be in place as soon as 2016.

European Commission President José Manuel Barroso said all 28 EU member states – including Germany – gave their blessing on the final wording of the Comprehensive Economic and Trade Agreement (CETA) made public Friday in Ottawa.

"Until now, all the official communications we've received from Germany were absolutely in favour of this agreement and it would be very strange if it were to be otherwise," he said, adding that within the EU, Germany is likely to benefit the most from the deal.

Mr. Barroso predicted that all member states will ratify the deal in 2015 and its provisions will be in place starting in 2016. The wide-ranging deal includes extensive provisions to eliminate tariffs and makes it easier for citizens of both sides to work abroad through skills recognition and intercompany transfers.

The deal allows companies to compete for government work across the free-trade zone, including at the "sub-national" level such as municipal contracts. It also sets rules for "geographical indications," restricting how companies can use terms including Asiago, Feta and Gorgonzola that refer to specific locations.

For Prime Minister Stephen Harper, the deal is a major piece of his economic agenda, and he boasted Friday that once in place, it will mean Canada has free trade access to more than half of the world's economy.

But comments this week from senior German officials mean the future of the deal is not entirely clear. Both Mr. Barroso and European Council President Herman Van Rompuy – who also visited Mr. Harper and participated in Friday's announcement – are on their way out.

German Economy Minister Sigmar Gabriel spoke out this week against the deal's provisions for resolving legal disputes between governments and corporations. Critics of these investor-state provisions argue they grant corporations too much power to strike down legislation passed by elected governments.

Protesters gathered on the lawn of Parliament Hill during the announcement Friday highlighted this aspect with a giant inflatable hammer covered in corporate logos.

Mr. Harper said expressions of concern from EU member states and Canadian provinces and territories are to be expected as part of the ratification process.

"I expect this kind of thing will happen, but in the end, we have an agreement, a good agreement," Mr. Harper said. His spokesperson, Jason MacDonald, later clarified that Canada considers the deal final.

"We will not be reopening negotiations," he said in an e-mail.

NDP Leader Thomas Mulcair said his party is still going over the final text, but noted that he shares the concerns expressed by German politicians.

"We're very reticent with what we're seeing now with regard to the investor-state provision," Mr. Mulcair said.

Liberal trade critic Chrystia Freeland said her party is generally supportive of the deal but is concerned that it is facing resistance in Europe.

German criticisms of CETA have so far come from members of Germany's Social Democratic Party, which is a junior partner in a coalition government with the Christian Democratic Union party led by Chancellor Angela Merkel. Some observers have suggested the recent objections may have more to do with internal German politics and positioning in connection to the EU's ongoing trade talks with the United States.

Trade lawyer Lawrence Herman said it will take time to study the final text, but the concerns from Germany cannot be ignored.

Mr. Herman added that the EU needs to prove to the U.S. that it can bring trade talks to a successful conclusion.