Deepening EU–Moldovan Relations Deepening EU–Moldovan Relations What, why and how? Edited by Michael Emerson and Denis Cenușa CEPS contributors Expert-Grup contributors Steven Blockmans Michael Emerson Denis Cenușa Vadim Gumene Hrant Kostanyan Iurie Morcotylo Guillaume Van Der Loo Dumitru Pîntea Ana Popa One of a trilogy of Handbooks explaining the EU’s Association Agreements and DCFTAs with Georgia, Moldova and Ukraine Centre for European Policy Studies (CEPS), Brussels Expert-Grup, Chișinău Rowman & Littlefield International, London Published by Rowman & Littlefield International, Ltd. Unit A, Whitacre Mews, 26-34 Stannary Street, London SE11 4AB www.rowmaninternational.com Rowman & Littlefield International Ltd. is an affiliate of Rowman & Littlefield 4501 Forbes Boulevard, Suite 200, Lanham, Maryland 20706, USA With additional offices in Boulder, New York, Toronto (Canada), and Plymouth (UK) www.rowman.com Copyright © 2016 Centre for European Policy Studies Centre for European Policy Studies Place du Congrès 1, B-1000 Brussels Tel: (32.2) 229.39.11 E-mail: [email protected] Website: http://www.ceps.eu Illustrations by Constantin Sunnerberg ([email protected]) The authors have asserted their rights to be identified as the authors of this work in accordance with the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval systems, without written permission from the publisher, except by a reviewer who may quote passages in a review. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library ISBN: 978-1-78660-174-2 Paperback 978-1-78660-170-4 Hardback 978-1-78660-175-9 Ebook The paper used in this publication meets the minimum requirements of American National Standard for Information Sciences—Permanence of Paper for Printed Library Materials, ANSI/NISO Z39.48-1992. Printed in the United States of America CONTENTS List of Tables and Boxes vi Abbreviations vii Preface ix Summary 1 Part I. Political Principles, the Rule of Law and Foreign Policy 8 1. Political principles 9 2. Rule of law and movement of people 19 3. Foreign and security policy 26 Part II. Deep and Comprehensive Free Trade Area 30 4. Market access for goods 31 5. Trade remedies 40 6. Customs services 42 7. Technical standards for industrial goods 51 8. Food safety regulations 61 9. Services 69 10. Public procurement 79 11. Intellectual property rights 91 12. Competition policy 99 13. Statistics 106 Part III. Economic Cooperation 109 14. Macroeconomic context and financial assistance 110 15. Financial services 116 16. Transport 125 17. Energy 135 18. Environment 145 19. Digital sector 155 20. Consumer protection 164 21. Company law 170 22. Agriculture 176 23. Employment and social policy 183 24. Education, training and culture 190 25. Science and technology 194 26. EU agencies and programmes 197 27. Cross-border cooperation 202 28. Civil society 206 Part IV. Legal and Institutional Provisions 210 29. Dispute settlement 211 30. Institutional provisions 216 v List of Tables and Boxes Table 4.1 Moldovan products subject to annual duty-free TRQs for import into the EU 32 Table 4.2 Trade turnover between Moldova and the EU ($ mn) 34 Table 4.3 Moldova’s trade structure by country or region, 2013 and 2015 35 Table 4.4 Main EU imports from, and exports to, Moldova, 2015 36 Table 9.1 National treatment or MFN reservations to establishment 70 Table 9.2 Market access and national treatment reservations for cross-border services 72 Table 10.1 Thresholds for the application of public procurement rules 80 Table 10.2 Indicative time schedule for approximation of public procurement rules 83 Table 14.1 Main economic indicators of Moldova 112 Table 14.2 EU budgetary assistance to Moldova, by sector, 2014–20 114 Table 19.1 Aspects of ICT development in Moldova, Georgia, Ukraine and Romania 158 Table 21.1 Overview of EU company law directives for approximation 171 Table 25.1 Main thematic priorities of Horizon 2020 195 Box 8.1 Moldovan honey exports to the EU 64 Box 9.1 Summary of commitments and reservations of the EU and Moldova for services sectors 75 Box 11.1 Steps taken by Moldova in acceding to IPR conventions and organisations 96 Box 15.1 The 2014 bank fraud 121 Box 16.1 Investment funding in transport projects 132 Box 17.1 Energy issues related to Transnistria 141 Box 17.2 The Moldova–Romania gas pipeline and electricity grid connections 143 Box 18.1 Basic features of the Moldovan environment 148 Box 18.2 EBRD, EIB and EU-funded water and waste management in Chișinău 151 Box 22.1 Summary of EU agricultural policy laws referred to in the Agreement 177 Box 23.1 Relationship between EU employment and social directives and ILO conventions 185 Box 26.1 EU agencies open to Ukraine, Moldova and Georgia 197 Box 26.2 EU programmes open to Ukraine, Moldova and Georgia 198 Box 27.1 Regions of Moldova, Romania and Ukraine participating in cross-border cooperation 203 Box 27.2 Romania–Ukraine–Moldova cross-border projects, 2007–13 204 vi ABBREVIATIONS AA Association Agreement ATM Autonomous trade measures ACAA Agreement on Conformity and Assessment and Acceptance of Industrial Products AEO Authorised Economic Operator ANRE National Agency for Energy Regulation ANSA National Agency for Food Safety ATP Autonomous trade preferences CAA Common Aviation Agreement CE Conformité Européene CEN European Committee for Standardisation CENELEC European Committee for Electrotechnical Standardisation CFSP Common Foreign and Security Policy CIS Commonwealth of Independent States CJEU Court of Justice of the European Union COSME Competitiveness of small and medium-sized enterprises CRS Computer reservation system CSDP Common Security and Defence Policy DCFTA Deep and Comprehensive Free Trade Area DG Directorate-General DO Designation of origin DSM Dispute settlement mechanism EBRD European Bank for Reconstruction and Development ECtHR European Court of Human Rights EESC European Economic and Social Committee EIB European Investment Bank ETSI European Telecommunications Standards Institute EU European Union EUBAM EU Border Assistance Mission GATS General Agreement on Trade in Services GATT General Agreement on Tariffs and Trade vii GI Geographical indication GMO Genetically modified organism GOST Gosudarstvenny Standart (State Standard) GPA Government Procurement Agreement GSP Generalised System of Preferences ICT Information and communication technology ILO International Labour Organization IMF International Monetary Fund IPR Intellectual property right MAFI Ministry of Agriculture and Food Industry MFN Most favoured nation MOLDAC National Institute of Metrology and the National Centre of Accreditation NBM National Bank of Moldova NBS National Bureau of Statistics NCFM National Commission for Financial Markets NCIP National Commission on Intellectual Property NCTS New Computerised Transit System NGO Non-governmental organisation NIPS National Intellectual Property Strategy OECD Organisation for Economic Cooperation and Development OGP Open Government Partnership OSCE Organization for Security and Cooperation in Europe PEM Pan-Euro-Mediterranean system of rules of origin PLLC Public limited liability company SPS Sanitary and phytosanitary (food safety) regulations TBT Technical barriers to trade (industrial product standards) TRIPS Agreement on Trade-Related Aspects of Intellectual Property Rights TRQ Tariff rate quota UNDP United Nations Development Programme VLAP Visa Liberalisation Action Plan WTO World Trade Organization viii PREFACE his Handbook seeks to explain the contents of a long and complex legal treaty – the Association Agreement, which includes a Deep and Comprehensive Free Trade Area (DCFTA) T– between the Republic of Moldova and the European Union (EU). Like most complex legal texts, it cannot be read like a book. Therefore, the purpose here is to make it possible for anyone to understand what each chapter of the Agreement means, in terms of both the nature of the commitments that the parties take on and the prospects for their implementation. The Handbook has in mind a broad range of readers, including officials, parliamentarians, business leaders, lawyers, business consultants, think tanks, civil society organisations, university teachers, trainers, students and journalists. The 30 chapters in this Handbook are mainly the same as those in the Agreement, but are not identical. Some chapters of lesser interest in the Agreement are not covered here, and there is some rearrangement of the various chapter headings. The present Handbook is one of a trilogy that covers very similar but not identical agreements between the EU on the one hand, and Georgia, Moldova and Ukraine on the other. All three books are available electronically for free downloading in English and the respective languages of the three countries at www.3dcftas.eu. There are some references in the Handbook to an Association Agenda, which is a document drawn up jointly by Moldova and the EU, reviewing progress in implementing the Association Agreement, and which usefully provides updating and some greater detail on various topics. The Agreement and Agenda are thus not to be confused. The official texts of both documents are also available in English and Romanian at www.3dcftas.eu. A much shorter version of this book is being prepared with the aim of reaching a wider readership, including students. This version will also be available in print and online for free downloading in English, Romanian and Russian at www.3dcftas.eu. ix x PREFACE The Handbook has been prepared by two teams of researchers and experts, from CEPS in Brussels and Expert-Grup in Chișinău. Established in 1983, CEPS is a leading think tank on European affairs, with a strong in-house research capacity and an extensive network of partner institutes throughout the world. Its mission is to produce sound policy research leading to constructive solutions to the challenges facing Europe. The Expert-Grup is an independent think tank, specialising in economic and policy research.