The Special Treatment of Developing Countries: The EU Legislator’s Migration Controversy

SERIES OF BLOG POSTS ON MIGRATION AND TRADE PUBLISHED UNDER THE SUPERVISION OF PROF. ELSPETH GUILD

NUMBER 2

By Professor Elspeth Guild, Queen Mary University of London

This series of blog posts on Trade & Migration is published upon the initiative of Prof. Elspeth Guild in relation with the controversial proposal for a regulation on the scheme of preferences for developing countries that the Commission links to the issue of readmission of irregular migrants.

Trade policy and tariffs are a fully exercised exclusive competence of the EU, but this does not mean that it is free to take action as it pleases without regard to its international obligations. The EU is a member of the World Trade Organisation (WTO) which is the sole international organisation dealing with multinational trade issues. The general principle of multinational trade agreements is to achieve smooth economic activity among states. They are generally based on the principle of the most favoured nation treatment and include removing or cutting customs duties on goods, scrapping limits (quotas) on goods to be exported, regulating access to provide services and to public contracts and reducing bureaucratic obstacles to trade.

WTO agreements can include special provisions which give developing countries special rights and give developed countries the possibility to treat them more favourably than other WTO members as an exception to the most favoured nation principle. These are generically known as “special and differential treatment provisions”. It is in this international context that the EU has granted trade preferences to developing countries and least developed countries through the Generalised Scheme of Preferences (GSP). The GSP is part of the EU’s common commercial policy, and according to the Commission, it is “one of the key EU trade instruments to assist developing countries to integrate in the world economy, reduce poverty, and support sustainable development through the promotion of core human and labour rights, environmental protection, and good governance.”

The EU’s internal regulation implementing the GSP system comes to an end on 31 December 2023 and to maintain the system of preferences, a new one needs to be adopted before 1 January 2024. In anticipation of these deadlines, the Commission has submitted a new proposal in which it states that the EU’s overarching objectives are “to maintain the essential features of the present Regulation, namely poverty eradication and support for sustainable development and good governance, while also not jeopardising EU interests”.

As sets out in a previous blog in this series, from the perspective of international trade law, developing and least developed countries are protected by strict limits in international law on the conditions which developed countries can place on GSPs. The problem which the EU proposal raises is the compatibility of one of its new conditions with those permitted in international law. Specifically, the Commission has proposed the following new Article 19(c):

“The preferential arrangements referred to in Article 1(2) may be withdrawn temporarily, in respect of all or of certain products originating in a beneficiary country, for the following reasons:
(c) serious shortcomings in customs controls on the export or transit of drugs (illicit substances or precursors), or related to the obligation to readmit the beneficiary country’s own nationals or serious failure to comply with international conventions on antiterrorism or anti-money laundering”.

Thus, the proposal links trade benefits to satisfactory performance in migration management, specifically regarding return (expulsion) from the EU. Making the GSP conditional on readmission raises the issue of EU compliance with international law. It is the subject of a joint letter by a number of NGOs to the Council of the EU identifying additional negative consequences of introducing such a conditionality. Human Rights Watch and others “urge members of the Council to reconsider and abandon the proposition to condition trade preferences for GSP beneficiary countries on their migration and readmission cooperation with the European Union”. They state that the readmission conditionality could prevent less developed countries from benefitting from sustainable development, including progress on human rights and climate change objectives. The letter references Geraldo Vidigal’s legal opinion on the issue where the author questions the readmission conditionality’s compatibility with WTO rules on the basis that, inter alia, GSP schemes are designed to promote trade with developing countries, rather than furthering domestic interests of participating states.

Like all EU proposals for legislation, this one has an extensive explanatory memorandum outlining the reasons for the proposal and the considerations which the Commission has taken into account when putting it before the legislator. While all the other proposed changes are the subject of substantial explanations, that to Article 19(c) has virtually none:

On page 11 under overall impact on the administrative costs there is recognition that a GSP withdrawal procedure or adding elements linked to the obligation to readmit the beneficiary’s own nationals would add administrative costs;
on page 12 in the detailed explanation of the specific provisions of the proposal there is a reference to the change which simply states that it introduces a withdrawal procedure related to readmission of own nationals. This is somewhat surprising bearing in mind the controversy around it. Either the Commission did not consider it sufficiently important to merit a detailed explanation or they did not wish to do so.

The only explanation for the new provision is found in recitals 26 and 27 of the preamble of the proposal for a regulation:

(26) Orderly international migration can bring important benefits to the countries of origin and destination of migrants and contribute to their sustainable development needs. Increasing coherence between trade, development and migration policies is key to ensure that the benefits of migration accrue mutually to both the origin and destination countries. In this respect, it is essential for both origin and destination countries to address common challenges, such as stepping up cooperation on readmission of own nationals and their sustainable reintegration in the country of origin, in particular in order to avoid a constant drain in active population in the countries of origin, with the ensuing long-term consequences on development, and to ensure that migrants are treated with dignity.

(27) Return, readmission and reintegration are a common challenge for the Union and its partners. In particular, every State has the obligation to readmit its own nationals under international customary law, and multilateral international conventions such as the Convention on International Civil Aviation signed in Chicago on 7 December 1944. Improving sustainable reintegration and capacity building would significantly strengthen the local development in the partner countries.

These recitals are insufficient to explain the addition in light of the apparent conflict with international law. The echo of the language of the UN Global Compact for Safe Orderly and Regular Migration in the beginning of recital 26 comes as a nasty surprise. Bearing in mind that the basis of the Global Compacts is respect for human rights of migrants and non-regression as regards their treatment by states, using the compact to justify return of migrants, in particular those from least developed countries, as in the interests of the international community and to everyone’s benefit ring hollow.

In the legislative procedure, in October 2021 there was a reading of the proposal in the European Parliament where the opinions of the committees on international trade (the lead committee), the development and the foreign affairs committees were requested. Heidi Hautala, rapporteur for the International Trade Committee published her report on 5 January 2022. She recommended substantial amendment to the two recitals stressing that a coordinated approach to migration is key to ensure that the benefits of migration accrue, referencing the two UN Global Compacts for refugees and migration as well as the Sustainable Development Goals but removing any reference to return or the Commission’s argument about states’ duty to readmit their nationals. For the provision itself, she recommended the following amendment to proposed Article 19(c): “serious shortcomings in customs controls on the export or transit of drugs (illicit substances or precursors), or serious failure to comply with international conventions on antiterrorism and anti-money laundering;”. All reference to migration was deleted.

Her approach was followed by the rapporteurs in the other two committees (development and foreign affairs). The Trade Committee adopted the rapporteur’s approach to Article 19(c) in its report on 17 May 2022 by a vote of 33 in favour and 8 against. Following this vote, the report is currently awaiting Parliament’s position on first reading which, if positive, will result in the beginning of inter-institutional negotiations on the proposal.

The importance of the European Parliament’s position cannot be over-emphasised. As co-legislator it has the power to make sure that the proposal only goes ahead with the deletion of the wording in proposed Article 19(c). The EU’s reputation as a faithful participant in the international community’s programme to assist developing and least developed countries in the area of trade through GSP is at stake in this controversy. The inability of the EU to stop the drowning of migrants in the Mediterranean has already tarnished its reputation in the field of human rights protection and migration. The shameful role of Frontex in abetting and covering up human rights abuses of migrants in the Aegean and Eastern Mediterranean revealed by the EU’s own anticorruption watchdog OLAF in a report has done nothing to assuage international concerns about the EU’s commitment in the field. The attempt to undermine the objectives of GSP to pursue irregular migration goals would be a very unattractive addition to the litany of EU failures to uphold the highest standards for its migration policy.