               EUROPEAN COMMISSION
            Brussels, 28.11.2019
            COM(2019) 608 final
            ANNEX
            to the
            Recommendation for a Council Decision
            updating the negotiating directives for the negotiations of Economic Partnership Agreements (EPAs) with African, Caribbean and Pacific (ACP) countries and regions

               ANNEX

               Directives for the negotiations of Economic Partnership Agreements (“EPAs”) with African Caribbean Pacific (ACP) countries and regions

               1.Preamble

               Apart from the general reference to the Cotonou Agreement and its successor agreement, special reference will be made, inter alia, to the following:

               ·The commitment of the parties to promote and expedite the economic, cultural and social development of the ACP States, with a view to contributing to peace, prosperity and security and to promoting a stable and democratic political environment;

               ·The commitment of the parties to the respect for human rights, including core labour rights, democratic principles and the rule of law, which constitute the essential elements of the ACP-EU Partnership and to good governance, which constitutes a fundamental element of the ACP-EU Partnership;

               ·The commitment of the parties on a set of internationally agreed principles and rules aimed at fostering a mutually supportive relationship between trade and sustainable development, including supporting the 2030 Agenda for Sustainable Development (2030 Agenda) and its Sustainable Development Goals (SDGs), and the Paris Agreement under the UN Framework Convention on Climate Change;

               ·The commitment of the parties to centre their partnership on the objective of reducing and eventually eradicating, poverty consistent with the objectives of sustainable development and the gradual integration of the ACP countries into the world economy; to build, therefore, ACP-EU economic and trade co-operation on regional integration initiatives existing within the ACP countries;

               ·The objective of ACP-EU economic and trade co-operation to foster the smooth and gradual integration of ACP States into the world economy, with due regard for their political choices and development priorities, and in particular their own poverty reduction strategies (notably Poverty Reduction Strategy Programmes) thereby promoting their sustainable development and contributing to poverty eradication in the ACP countries;

               ·The commitment of the parties to support the regional integration process within the ACP Group of States and to foster regional integration as a key instrument for the integration of ACP countries into the world economy;

               ·The commitment of the parties to strengthen economic and trade co-operation and to create a new trading dynamic between them with a view to facilitating the transition of the ACP countries to a liberalised global economy;

               ·The commitment of the parties to take account of the different needs and levels of development of the ACP countries and regions;

               ·The commitment of the parties to respect their obligations assumed within the framework of the World Trade Organisation (WTO) and to further the objectives of the WTO;

               ·The joint objective of the parties to enhance co-operation in all areas relevant to trade and to achieve progressive and reciprocal liberalisation of trade in goods and services, in accordance with WTO rules, taking into account the level of development of the ACP countries and the economic, social and environmental constraints they are facing;

               ·The commitments of the parties to ensure that efforts undertaken in the framework of the Cotonou Agreement and its successor agreement and those undertaken in the framework of EPAs are mutually reinforcing.

               2.Nature and Scope of the Agreements

               EPAs shall aim at fostering the smooth and gradual integration of the ACP States into the world economy, with due regard for their political choices and development priorities, thereby promoting their sustainable development and contributing to poverty eradication in the ACP countries.

               Pursuant to the provisions of Article 36(1) of the Cotonou Agreement and the relevant provision in the new ACP-EU Partnership Agreement, once applicable, negotiations shall aim at establishing Economic Partnership Agreements (“EPAs”) with ACP sub-groups defined in accordance with the provisions of Article 37(3) of the Cotonou Agreement and the relevant provision in the new ACP-EU Partnership Agreement, once applicable, taking into account the regional integration process within the ACP.

               EPAs shall be directed at fostering closer economic integration between the parties, by removing progressively barriers to trade between them and enhancing co-operation in all areas relevant to trade, in full conformity with the provisions of the WTO.

               EPAs shall be consistent with the objectives and principles of the Cotonou Agreement and its successor agreement, and in particular with the provisions of Part III, Title II thereof. Negotiations of EPAs shall therefore notably take account of the different levels of development of the parties as well as of the particular economic, social and environmental constraints of the ACP countries and of the capacity to adapt and to adjust their economies to the liberalisation process.

               3.Trade in Goods

               3.1.Objective

               EPAs shall be directed at establishing free trade areas between the parties, based on the development objectives of the Cotonou Agreement and its successor agreement, in conformity with the provisions of the WTO It is understood, therefore, that the following market access conditions would be available only in the context of these EPAs.

               3.2.Import duties

               ·Imports into the European Union

               EPAs shall build upon and further enhance the market access conditions currently provided under the Cotonou Agreement and its successor agreement. The specific arrangements for further tariff dismantling shall be fixed in the course of the negotiations, taking account of the existing and potential export interests of the ACP countries and of the impact of trade liberalisation measures in particular on regional integration within the ACP.

               ·Imports into the ACP countries

               With the overriding objective of promoting development through regional economic integration and adequate policies, negotiations will pursue (1) the elimination of customs duties on imports from the EC for substantially all trade over the course of a transitional period, and (2) the abolishing of all charges having equivalent effect to customs duties upon entry into force of EPAs.

               The timetable for tariff dismantling and the final product coverage of trade liberalisation by the ACP countries will reflect the economic, social and environmental constraints they are facing as well as their capacity to adapt their economies to the liberalisation process. Therefore, a transitional period, compatible with the objectives of the Cotonou Agreement, its successor agreement and WTO rules, will be applied in a flexible way, to take into account specific constraints of the ACP countries concerned. The same flexibility will be applied in relation to product coverage and the calendar/rhythm of liberalisation commitments by the ACP countries.

               In this context, the parties will examine, on a case-by-case basis, the potential impact of export refund mechanisms on the process of trade liberalisation.

               Notwithstanding the above, ACP countries shall grant to the European Union at any time treatment no less favourable than MFN treatment. This does not apply with respect to concessions made between ACP countries or by ACP countries to other developing countries in the framework of regional agreements or other trade provisions compatible with WTO requirements.

               During the negotiations, and in the light of Article 349 of the Treaty on the Functioning of the European Union and the agreements reached in the framework of the Cotonou Agreement and its successor agreement, account will be taken of the specific interests of the European Union’s outermost regions. In this context, EPAs may in particular provide for specific measures in favour of products from these regions, aimed at their integration into intra-regional trade in the short term, in accordance with the provision of the WTO.

               The ACP countries shall undertake, at least, to extend automatically the treatment granted to the European Union to all other parties of the EPA concerned, preferably ahead of trade liberalisation vis-à-vis the European Union.

               Where serious difficulties occur as a result of trade liberalisation, the ACP countries may, in consultation with the European Union, temporarily suspend the application of the liberalisation schedule and, where necessary re-modulate the rate of progress towards the ultimate establishment of the free trade area, in full conformity with the provisions of the WTO.

               The trade liberalisation plans and schedule of the ACP countries shall be part of EPAs. It shall include the appropriate product lists as well as timetables for tariff dismantling. These lists and timetables will be finalised during the negotiations.

               ·Basic duties

               The basic duties to which the agreed reductions are to be applied shall be the MFN duties effectively applied by the ACP countries on the day of the signature of the EPAs. They shall be defined in a list attached to each EPA.

               3.3.General provisions

               Export duties. Any export duties applied in trade between the parties shall be eliminated on an agreed timetable that will not exceed ten years.

               Quantitative restrictions and measures having equivalent effect applied to exports or imports in trade between the parties shall be abolished on entry into force of EPAs.

               National treatment and fiscal measures. A standard national treatment provision, ensuring parties' products receive treatment no less favourable than that accorded to like products of national origin, will be included in the EPAs. Any discriminatory internal fiscal measures or practices already in existence will be eliminated from the entry into force of EPAs.

               Tax carve out clause. EPAs will include a tax carve out clause in accordance with Article 52 of the Cotonou Agreement and with the relevant tax carve out provision of its successor Agreement, once applicable.

               Variable speed. Where compatible with the integration objectives of the ACP regions concerned, EPAs shall provide for variable speed in trade liberalisation, taking into account the level of development of the ACP countries concerned as well as of the different intensities of integration that may exist within the region, in line with the region's internal integration process.

               Food security clause. The Agreement shall include provisions aimed at fostering food security in accordance with WTO rules.

               Safeguards. Safeguard provisions shall apply, in accordance with the relevant provisions of the WTO.

               Antidumping. If one of the parties finds that injurious dumping or subsidisation is taking place in trade by the other party within the meaning of the provisions of GATT, it may take appropriate measures against this practice, in accordance with the GATT/WTO rules and practices. In this context, the European Union shall have special regard to the particular economic and social situation of the ACP countries concerned.

               Standstill. The parties will agree that no new duties will be introduced nor existing duties be increased and that no new quantitative restrictions nor measures having equivalent effect will be introduced by either party after the entry into force of the agreements between the regional grouping and the EU.

               Transparency. Both sides will be required to communicate to each other its customs tariff schedule and any subsequent amendments made to it.

               Exceptions clause. The Agreement will include a standard exceptions clause allowing measures to be taken, for instance, on grounds of protection of public order, human, animal or plant life or health, conservation of exhaustible natural resources etc, provided that such measures are applied in conformity with WTO rules.

               Classification of goods. The Harmonised System shall be applied to the classification of goods in trade between the Parties.

               3.4.Rules of origin, administrative co-operation and financial responsibility

               Negotiations on the rules of origin, administrative co-operation and financial responsibility shall be based in the standard EU preferential rules of origin and on the existing rules of origin under each EPA. In this context, the European Union shall assess any specific request for changes to the rules of origin, presented by the ACP State(s), aimed at simplifying existing rules and improving current market access for the ACPs.

               The Agreement will empower the Contracting Parties to take appropriate measures in the event of lack of administrative co-operation or mismanagement. With respect to the issue of losses of customs duties linked to the mismanagement of preferential imports appropriate measures could be identified on the basis of a horizontal Council decision.

               3.5.Customs, trade facilitation and anti-fraud measures

               Negotiations shall aim at simplifying all requirements and procedures related to imports and exports, in particular with regard to customs processes, import licensing, customs valuation, transit rules and pre-shipment inspection, drawing on the highest international standards and in conformity with the provisions of the WTO Trade Facilitation Agreement. The agreement will include a Protocol on mutual administrative assistance in customs matters. It will also include an anti-fraud clause to prevent the abuse of tariff preferences.

               4.Trade in Services and Investment

               4.1.Scope

               The Agreement will provide for a progressive and reciprocal liberalisation of trade in services and investment aiming at assuring a comparable level of market access opportunities, consistent with the relevant WTO rules, in particular Article V of the GATS, taking into account the level of development of the ACP countries concerned. [The Agreements will provide for audio-visual services to be dealt separately in specific agreements for cultural cooperation and partnership between the parties. These agreements will ensure the possibility for the European Community Union and its Member States as well as for the ACP to preserve and develop their capacity to define and implement their cultural and audio-visual policies for the preservation of their cultural diversity, while recognizing, preserving and promoting the cultural values and identities of the ACP, to foster intercultural dialogue by improving market access opportunities for the cultural goods and services of these countries, in accordance with the provisions of Article 27 of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable..

               The parties will agree that no new or more discriminatory measures will be introduced by either party after the entry into force of the agreements between the regional grouping and the European Union.

               The liberalisation process will take place on an asymmetrical basis. The ACP countries will be allowed a certain measure of flexibility depending on their level of development in overall terms as well as in terms of sector and sub-sector in accordance with the provisions of the GATS, in particular those relating to developing countries' participation in the liberalisation agreements.

               For the European Union, the transition period will not exceed 10 years.

               For the ACP side, a transitional period, compatible with the objectives of the Cotonou Agreement, its successor agreement and WTO rules, will be applied in a flexible way, to take into account specific constraints of the ACP countries concerned.

               ACP countries belonging to an EPA will undertake to apply at least the same arrangements between them as they apply to the European Union.

               The EPAs will reconfirm the commitments made under the terms of Article 42 of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable.

               4.2.Practical arrangements

               Where justified by particular economic, social and environmental constraints encountered by the ACP countries, the negotiations may be postponed. In such an event, the parties shall regularly assess the situation in the course of the EPA negotiations. They will ensure that the preparatory phase to these negotiations is actively used to prepare for the negotiations, in particular by mobilising appropriate support for the development of services in line with the provisions of the Cotonou Agreement in particular Article 41(5) thereof and the relevant provision of its successor Agreement, once applicable.

               5.Current Payments and Capital Movements

               EPAs will reconfirm the commitments undertaken in the framework of Article 12 of Annex II to the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable.

               With a view to strengthening and developing financial markets, the parties shall seek to negotiate further opening of the capital market beyond direct investment, while respecting existing monetary agreements and while taking into account the need to develop an appropriate regulatory framework.

               The agreements will include a clause providing for the possible revision of this chapter to ensure coherence between obligations made within the framework of Economic Partnership Agreements and other relevant agreements, including commitments under the GATS.

               6.Trade-related Areas

               6.1.General

               EPAs will reconfirm the respective commitments undertaken in the framework of the Cotonou Agreement
                  1
                and its successor agreement, in particular with regard to competition policy, protection of intellectual property rights (including geographical indications), standardisation and certification, sanitary and phytosanitary measures, trade and environment, trade and labour standards, consumer policy and protection of consumer health. These provisions will be reviewed in the light of the results of the forthcoming multilateral trade negotiations.

               6.2.Specific areas

               In addition, the following shall apply with regard to the following areas:

               Investment. In accordance with the objective of “reducing and eventually eradicating poverty consistent with the objective of sustainable development” (and with regard to articles 1, 29, 75 to 78, and to Annex II of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable) the parties agree to establish a regulatory framework which shall facilitate, enhance and stimulate mutually beneficial sustainable investment between them. This framework will be based on principles of non-discrimination, openness, transparency and stability.

               Where identified by both parties as an area for negotiation, and subject to additional country- or region-specific negotiating directives, provisions on investment protection may be negotiated, which will endorse the best results agreed in the competent international fora or bilaterally. Those provisions should ensure a strong protection of investors and investments, while fully preserving the Parties' right to regulate within their territories to achieve legitimate policy objectives.

               Public procurement. EPAs will aim to ensure full transparency in procurement rules and methods at all government levels following the principles of the Government Procurement Agreement (WTO). In addition, the parties will seek progressive liberalisation of their procurement markets on the basis of the principle of non-discrimination and taking into account their development levels.

               Standards, technical regulations and conformity assessments. EPAs should contain a comprehensive chapter on Technical Barriers to Trade (TBT), building on and going beyond the WTO Agreement on TBT.

               Sanitary and Phytosanitary Standards. EPAs should contain a comprehensive chapter on Sanitary and Phytosanitary Standards (SPS), building on the WTO Agreement on SPS.

               Data protection. EPAs will set the objective to work towards the elimination of obstacles to free movement of personal data between the parties, created by the lack of adequate protection for personal data, via, inter alia, exchange of information and experts.

               Intellectual Property Rights. EPAs should create an adequate, balanced and effective level of protection and provide for civil and border enforcement provisions in the area of intellectual property rights, including geographical indications.

               Trade and Competition: EPAs should aim to minimise distortions of competition by means of provisions on competition policy, subsidies and state-owned enterprises. The provisions will not impede the delivery of public services.

               Trade and Sustainable Development: EPAs should adhere to the relevant internationally agreed principles and rules on labour (including gender non-discrimination), and environmental aspects of trade and sustainable development, including sustainable fisheries and those related to climate change, in particular the Paris Agreement. EPAs should include provisions for the effective implementation and monitoring of these rules, as well as a mechanism to address any disputes arising between the Parties.

               Agricultural Dialogue: Given the relevance of the agricultural sector for the socio-economic development and food security of ACP countries, EPAs may foresee a dialogue on agriculture (Agriculture Partnership), which may cover issues like commodities and regional value chains, use of new technologies and sustainable food systems.

               6.3.Implementation

               The EPA Council (see below, point 8), assisted by a Joint Implementation Committee composed of senior technical experts, will monitor the implementation of these provisions. The Joint Implementation Committee will meet on a regular basis and at least once a year. It will draw up annual reports assessing the progress made and formulating recommendations on measures for further achievements, including the provision of development co-operation in accordance with the provisions of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable.

               7.Complementarity

               EPAs and the development strategies of ACP partners (notably PRSPs) shall be mutually supportive. In particular, in order to facilitate the achievement of the objectives of EPAs the ACP parties will undertake to fully integrate EPAs within their development strategies and the EU to do likewise within its development co-operation strategies. This would encompass fostering support to the private sector development in particular Small and Medium Enterprises (SMEs) including its gender dimension. They will undertake to allocate adequate resources for that purpose within the national and regional indicative programmes, in accordance with the relevant provisions of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable.

               8.Institutional Framework

               A Joint EPA Council will be established for each EPA, which will perform the following functions:

               –ensure that the EPA operates properly;

               –study the development of economic and trade co-operation between the parties;

               –seek appropriate methods of preventing problems which might arise in areas covered by the EPA, in particular with regard to the achievement of the EPA's development objectives;

               –exchange opinions and make recommendations on any issue of common interest relating to economic and trade co-operation, including future actions for the proper implementation of the EPA and, in particular, the need for development co-operation to be provided in accordance with the relevant provisions of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable.

               The composition, frequency, agenda and venue of joint EPA Council meetings will be agreed on through consultation between the parties.

               The EPA Council will have the power to take decisions in respect of all matters covered by the EPA. It will report to the Council of Ministers established in accordance with the provisions of Article 15 of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable, on matters of common concern to the entire ACP Group of States and the European Union.

               The EPA should provide for regular consultations and communication with civil society.

               9.Final Provisions

               EPAs will include

               –a chapter on dispute settlement and a clause on non-execution, including provisions corresponding to Articles 96 and 97 of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable. Dispute settlement provisions on trade or trade related matters will not affect the parties’ rights and obligations under WTO rules, in particular the Understanding on Rules and Procedures Governing the Settlement of Disputes;

               –a clause on future developments providing that EPAs may be extended, in particular through accession, or merged, in accordance with the progress made in regional integration;

               –a clause on their entry into force, the duration (unlimited), termination, notice required for denunciation and a territorial application clause.

               For the purpose of EPAs, the parties on the ACP side shall mean the regional grouping or its Member States or the regional grouping and its Member States, in accordance with their respective spheres of competence. EPAs shall apply as well to measures taken by any state, regional or local authorities within the territories of the parties.

               10.Structure and Organisation of the Negotiations

               In accordance with the relevant provisions of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable, the period of negotiations will also be used for capacity building in the public and private sector of the ACP countries with a view to enhance their ability to define and implement appropriate regional and multilateral trade strategies and policies. This will include measures to enhance competitiveness, to strengthen regional organisations and to support regional trade integration initiatives, where appropriate with assistance to budgetary adjustment and fiscal reform, as well as to upgrade infrastructure, and to improve investment. These measures will be monitored by Regional Preparatory Task Forces, which will be established jointly by the regional grouping engaged in EPA negotiations and the European Union, at the beginning of the negotiations. The Regional Preparatory Task Forces will inter alia provide suggestions to be considered within the national and regional programming dialogue between the European Union and the ACP countries.

               Appropriate mechanisms will be established to ensure that Non-state actors in the EU and in the ACP countries will be informed and consulted on the content of negotiations and that co-ordination with ongoing ACP-EU dialogues is ensured.

                     (1)

                        Articles 45 to 51 and 78 of the Cotonou Agreement and the relevant provision of its successor Agreement, once applicable.

    ---documentbreak---

               EUROPEAN COMMISSION
            Brussels, 28.11.2019
            COM(2019) 608 final
            Recommendation for a
            COUNCIL DECISION
            updating the negotiating directives for the negotiations of Economic Partnership Agreements (EPAs) with African, Caribbean and Pacific (ACP) countries and regions

               EXPLANATORY MEMORANDUM

               1.CONTEXT OF THE PROPOSAL

               •Reasons for and objectives of the proposal

               The EU has been negotiating Economic Partnership Agreements (EPA) with African, Caribbean and Pacific (ACP) countries and regions between 2002 and 2014. The EU conducted these negotiations based on a wide-ranging mandate and negotiating directives issued by the Council on 12 June 2002 (9930/02).

               However, due to a number of circumstances, including capacity constraints on partner side, the concluded and implemented Agreements today mostly cover trade in goods only. Other areas (such as services, investment and trade-related issues) were not included in the agreements but were mentioned explicitly for a future review in the so-called “rendez-vous clauses”. This situation means that the current EPAs are not fully adapted to the trade realities of the 21st century and the interests of both the EU and the partner countries concerned. It is therefore possible that in the coming years, there will be an interest in “deepening” these agreements to cover also services, investment, trade and sustainable development, intellectual property rights, competition policy and public procurement, among other issues.

               To date, there are 31 countries implementing seven different EPAs in the ACP countries and regions.

               Amongst these, five countries currently implementing the interim EPA in Eastern and Southern Africa (ESA) (Mauritius, Madagascar, Seychelles, Zimbabwe and since recently Comoros) have requested to launch negotiations based on the rendez-vous clause. The aim is to establish a comprehensive agreement that will help them seize opportunities of global value chains. Negotiations towards such a comprehensive Agreement were launched on 2nd October 2019 in Mauritius.

               Future negotiations with ACP countries and regions, including with ESA, would be conducted based on the existing negotiating directives established by the Council in 2002, accompanying its authorisation to open negotiations. The existing 2002 directives are already comprehensive in nature, covering almost all trade-related areas. Nevertheless, they are today partly outdated in terms of wording, and lack coherence with recent EU policy initiatives and priorities as trade evolves worldwide, such as the reinforcement of our trade and sustainable development policy.

               Therefore, the Council requested an update of the negotiating directives adopted in 2002 in order to align the wording and content of these directives with recent developments and policies in trade-related areas, in particular the Trade for all Communication of the European Commission from 2015 but also the 2030 Agenda, with its core 17 Sustainable Development Goals, and the Paris Agreement to combat climate change adopted by the international community in 2015.

               This initiative therefore constitutes a contribution to the implementation of the Trade for all Communication, while taking into account the on-going negotiations on post-Cotonou Partnership Agreement. It also factors in the Africa-Europe Alliance for Sustainable Investment and Jobs launched by the President of the Commission in September 2018 and the External Investment Plan as its important component.

               The immediate objective of this initiative is to equip the Commission with up-to-date negotiating directives for Economic Partnership Agreements with ACP countries and regions that are aligned with current EU negotiation practice, and that ensure that any further negotiations with ACP countries and regions respond to current trade challenges.

               The global objective is to negotiate up-to-date and modern trade agreements with ACP countries and regions that will boost trade and investment and support these countries in their integration into the global economy.

               •Consistency with existing policy provisions in the policy area

                  The above objectives are consistent with the Treaty on the European Union (TEU) that provides that the EU should ‘encourage the integration of all countries into the world economy, including through the progressive abolition of restrictions on international trade’.
                     1

                  The objectives are also fully in line with the objectives of the Cotonou Agreement and the general principles, which that agreement promotes.

               •Consistency with other Union policies

                  The objectives are consistent with other EU policies.

               2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY

               •Legal basis

                  Article 207 (4) first subparagraph in conjunction with Article 218(3) and (4) of the TFEU.

                  Pursuant to Article 207(4), for the negotiation and conclusion of the agreements referred to in Article 207 (3), the Council shall act by a qualified majority.

                  Under Article Article 218 (3) TFUE the Commission shall submit recommendations to the Council, which shall adopt a decision authorising the opening of negotiations.

                  Under Article 218(4) TFEU the Council may address directives to the negotiator and designate a special committee in consultation with which the negotiations must be conducted.

                  As regards the negotiations for EPAs, the Council has already authorised the opening of negotiations, and issued directives to the Commission in 2002. However, the updating of the negotiating directives is necessary to frame more accurately new negotiations in light of recent EU policy initiatives and priorities as trade evolves worldwide. This means, inter alia, that the directives will need to reflect current ambitions of the EU to include in its agreements internationally agreed principles and rules on labour and environmental aspects, including references to the 2030 Agenda for Sustainable Development and the Paris Agreement to tackle climate change. The existing directives also do not reflect the need for provisions for the effective implementation and monitoring of these rules, as well as a mechanism to address any disputes arising between the Parties in this area.

                  Accordingly, the Commission recommends to the Council to adopt a Decision on the basis of Article 207 (4) first subparagraph in conjunction with Article 218 (3) and (4) TFEU.

               •Subsidiarity (for non-exclusive competence)

                  The common commercial policy is an area of exclusive EU competence under Article 3 TFEU. Accordingly, the subsidiarity principle does not apply (Article 5(3) TEU).

               •Proportionality

                  The recommendation of the Commission is in line with the principle of proportionality.

               •Choice of the instrument

                  Decision of the Council of the European Union on updating the negotiating directives for the negotiations of Economic Partnership Agreements (EPAs) with African, Caribbean and Pacific (ACP) countries and regions.

               3.RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS

               •Ex-post evaluations/fitness checks of existing legislation

                  An ex-post evaluation section concerning the implementation of the current interim EPA with ESA countries will be included in the forthcoming Sustainability Impact Assessment (SIA).

               •Stakeholder consultations

               No specific consultations with citizens and stakeholders are foreseen, as the update of the wording is limited.

               However, the Commission will consult citizens and stakeholders on individual negotiations that may be conducted in the future under the updated negotiating directives.

               In particular, for the upcoming negotiations with the ESA Economic Partnership Agreement States, a Sustainability Impact Assessment (SIA) will be launched to consult widely citizens and stakeholders, both in the EU and the ESA region, on the potential impact of the new trade topics to be included in the Agreement. Initial discussions have started in October 2019 and the SIA will be conducted in parallel to the negotiations in order to feed into the process.

               The SIA is a platform for systematic dialogue between stakeholders and trade negotiators, through in-depth consultation in which all stakeholders are given an opportunity to participate.

               The main stakeholders to be consulted during the SIA will include the public sector, non-governmental organizations, businesses, social partners and academia.

                  Beyond the ESA EU EPA, no further negotiations to deepen or expand other existing Economic Partnership Agreements are planned at this stage. Any such undertakings will be accompanied by region- and country specific assessments of potential impact and comprehensive stakeholder consultations.

                  The Commission also regularly consults stakeholders inter alia in the Expert Group on Trade Agreements
                     2
                   and the Civil Society Dialogue.
                     3

               •Collection and use of expertise

                  Not applicable.

               •Impact assessment

                  An impact assessment (IA) is not required at this stage since the negotiations for EPAs with ACP countries and regions are based on the existing authorisation of the Commission by the Council of 2002. The substance of the negotiations does not represent a new policy area; they are the continuation of negotiations that have been in progress for years.

                  Furthermore, an ex-ante IA is usually only done if there is a need to support the decision to launch or not negotiations with certain trade partners, i.e. before the Council gives its authorisation to start negotiations. In this case, the Council has already confirmed that there is no need for a new authorisation for the ESA deepening negotiations.

                  As the scope of the amendments of the current negotiating directives is limited, the impact should not be major.

                  As mentioned in the stakeholder consultations section, the European Commission is planning a sustainable impact assessment (SIA) for the negotiations of the new negotiations with ESA that will be launched early in 2020. It will include an ex-post evaluation section concerning the implementation of the current iEPA. This would provide us with an evaluation of the effects that go beyond what we do in classical sustainable impact assessments. The same approach could apply for any future negotiations regarding the deepening of the other existing EPAs.

               •Regulatory fitness and simplification

                  Not applicable.

               •Fundamental rights

                  The initiative fully respects the Charter of Fundamental Rights of the European Union, and in particular Article 8 on the protection of personal data.

               4.BUDGETARY IMPLICATIONS

                  The initiative does not have budgetary implications.

               5.OTHER ELEMENTS

               •Implementation plans and monitoring, evaluation and reporting arrangements

                  Not applicable.

               •Explanatory documents (for directives)

                  Not applicable.

               •Detailed explanation of the specific provisions of the proposal

                  Not applicable.

               Recommendation for a

               COUNCIL DECISION

               updating the negotiating directives for the negotiations of Economic Partnership Agreements (EPAs) with African, Caribbean and Pacific (ACP) countries and regions

               THE COUNCIL OF THE EUROPEAN UNION,

               Having regard to the Treaty on the Functioning of the European Union, and in particular Article 207 (4) first subparagraph in conjunction with Article 218 (3) and (4) thereof,

               Having regard to the recommendation from the European Commission,

               Whereas:

               (1)On 12 June 2002, the Council of the European Union adopted directives for the negotiations of Economic Partnership Agreements (EPAs) with African, Caribbean and Pacific (ACP) countries and regions.

               (2)Concluded EPAs with ACP countries and regions include rendez-vous clauses for future review of these agreements.

               (3)The updating of negotiating directives is necessary to frame more accurately new negotiations in light of recent EU policy initiatives and priorities as trade evolves worldwide.

               HAS ADOPTED THIS DECISION:

               Article

               The negotiating directives addressed to the Commission on the negotiations of Economic Partnership Agreements (EPAs) with African, Caribbean and Pacific (ACP) countries and regions are amended as set out in the Annex.

               Article 2

               This Decision is addressed to the Commission.

               Done at Brussels,

                     For the Council

                     The President

                     (1)

                        Article 21(2)(e) TEU

                     (2)

                  http://ec.europa.eu/trade/trade-policy-and-you/expert-groups/

                     (3)

                  http://trade.ec.europa.eu/civilsoc/meetdetails.cfm?meet=11531


               EUROPEAN COMMISSION
            Brussels, 5.2.2019
            COM(2019) 70 final
            Recommendation for a
            COUNCIL DECISION
            authorising the opening of negotiations in view of an agreement between the European Union and the United States of America on cross-border access to electronic evidence for judicial cooperation in criminal matters

               EXPLANATORY MEMORANDUM

               1.
                     CONTEXT

               Cross-border data flows are rising together with the growing use of social media, webmail, messaging services and apps to communicate, work, socialise and obtain information, including for unlawful purposes. An increasing number of criminal investigations therefore rely on electronic evidence that is not publicly available. The borderless nature of the internet and the way services can be provided from all over the world, including by non-European companies, means that facilitating cross-border access to electronic evidence is a pressing issue concerning almost any type of crime. In particular, the recent terrorist attacks have underlined the need, as a matter of priority, to find ways for European Union Member State prosecutors and judges to secure and obtain electronic evidence more quickly and effectively.

               More than half of all criminal investigations today require access to cross-border electronic evidence. Electronic evidence is needed in around 85% of criminal investigations, and in two-thirds of these investigations there is a need to obtain evidence from online service providers based in another jurisdiction. The number of requests to the main online service providers grew by 84% in the period between 2013 and 2018. These types of data are essential in criminal investigations to identify a person or to obtain information about their activities.

               Electronic evidence refers to various types of data in electronic form that are relevant in investigating and prosecuting criminal offences, and are often stored on the servers of online service providers. This includes 'content data' such as e-mails, text messages, photographs and videos as well as ‘non-content data’, such as subscriber data or traffic information regarding an online account.

               Cooperation between judicial authorities is the traditional method for authorities to work together to tackle all types of crime. Today, the main instrument that Member States use to request access to cross-border electronic evidence in most other European Union countries is the European Investigation Order.

               European Union Member States have recourse to Mutual Legal Assistance requests with third countries (and Denmark and Ireland who do not participate in the European Investigation Order). Several different authorities are involved on both sides. The procedures were designed at a time before the internet, when volumes of requests were a fraction of today’s, and they did not face the volatility of electronic evidence.

               One of the main recipients of Mutual Legal Assistance (MLA) requests from European Union Member States (and from around the world) for access to electronic evidence is the United States of America, where the largest service providers are headquartered. An agreement on Mutual Legal Assistance between the European Union and the United States of America was signed on 25 June 2003 and entered into force on 1 February 2010. The agreement is a key transatlantic mechanism for ensuring effective cooperation in the field of criminal justice and combatting organised crime and terrorism.

               A first joint review of the agreement took place in 2016
                  1
               . This concluded that the agreement adds value to the EU-U.S. Mutual Legal Assistance relationship and generally works well. Further efforts will be made to improve this cooperation. While judicial cooperation between public authorities, including with the United States of America, is crucial, this method is often too slow, when taking into account the volatile nature of electronic evidence, taking an average of 10 months, and can entail a disproportionate expense of resources. Moreover, whereas sovereignty is an important aspect in judicial cooperation in a particular investigation, it is becoming increasingly common that the only connection to another state is the location of the data or the service provider. Specifically on electronic evidence, the 2016 joint review encouraged Member States to cooperate directly with U.S. service providers in order to secure and obtain electronic evidence more quickly and effectively.

               Direct cooperation with U.S. service providers has developed as an alternative channel to judicial cooperation. It is limited to non-content data
                  2
                and is voluntary from the perspective of U.S. law. In practical terms, the public authorities of the European Union Member State directly contact a service provider in the United States of America with requests pursuant to national rules of criminal procedure to which the service provider has access, typically data on a user of the services it provides. This concerns some service providers established in the United States of America and, to a more limited extent, in Ireland, which reply directly to requests from Member States' law enforcement authorities on a voluntary basis, as far as the requests concern non-content data.

               U.S. law
                  3
                allows U.S.-based service providers to cooperate directly with European public authorities with regard to non-content data. However, this cooperation is voluntary. Thus, providers have created their own policies or decide on a case-by-case basis on whether and how to cooperate. In addition to the increase in direct cooperation with service providers, recent rulings and court cases in the United States of America sought to clarify whether U.S. authorities have the right to request the production of data stored abroad by a service provider whose main seat is in the United States of America, including notably the “Microsoft Ireland” case
                  4
               .

               The scale of direct cooperation requests on a voluntary basis has rapidly increased with more than 124 000 in 2017. While ensuring faster access compared to Mutual Legal Assistance, direct cooperation on a voluntary basis is limited to non-content data. Moreover, it can be unreliable, it may not ensure respect of the appropriate procedural safeguards, is only possible with a limited number of service providers which all apply different policies, is not transparent and lacks accountability. The resulting fragmentation may generate legal uncertainty, raise questions on the legality of prosecution as well as concerns on the protection of fundamental rights and procedural safeguards for the persons related to such requests. In addition, less than half of all the requests to service providers are fulfilled
                  5
               .

               As regards possible reciprocal requests by U.S. authorities to service providers in the European Union, in many Member States the telecommunications legal framework currently prohibits national telecommunications providers from responding directly to requests from foreign authorities, including for non-content data. In addition, there is no legal framework allowing direct cooperation in other communication sectors. U.S. authorities can usually only obtain such data from EU service providers through a Mutual Legal Assistance request.

               2.
                     OBJECTIVES OF THE PROPOSAL

               The European Commission committed in the April 2015 European Agenda on Security
                  6
                to review obstacles to criminal investigations into cyber-enabled crimes, notably on cross-border access to electronic evidence. On 17 April 2018, the Commission proposed to the European Parliament and the Council a Regulation on European Production and Preservation orders for electronic evidence in criminal matters
                  7
                and a Directive laying down harmonised rules on the appointment of legal representatives for the purpose of gathering evidence in criminal proceedings ("e-evidence proposals")
                  8
               .

               The purpose of these proposals is to speed up the process in the European Union to secure and obtain electronic evidence directly from service providers established in another jurisdiction. The scope of the proposals includes specific types of service providers that are providing services in the European Union. A provider is offering services in the European Union when it enables users in one or more Member States to use its services and where it has a substantial connection to the Union, for instance when it has an establishment in a Member State or because it provides services to a large number of users in that Member State. Those without a presence in the European Union are obliged to appoint a legal representative against whom production orders can be enforced.

               The European Council has stressed the importance of this issue both internally and externally. The European Council Conclusions of 18 October 2018 state that “Solutions should be found to ensure swift and efficient cross-border access to electronic evidence in order to effectively fight terrorism and other serious and organised crime, both within the EU and at international level; the Commission proposals on electronic evidence and access to financial information, as well as to better combat money laundering, should be agreed on by the end of the legislature
                  9
               . The Commission should also urgently submit negotiating mandates for the international negotiations on electronic evidence”.

               The Commission's e-evidence proposals provide the basis for a coordinated and coherent approach both within the European Union and by the European Union at international level, with due regard to European Union rules, including on non-discrimination between European Union Member States and their nationals. While the Commission, in its Impact Assessment for the e-evidence proposals, already noted that the proposals could usefully be complemented by bilateral or multilateral agreements on cross-border access to electronic evidence with accompanying safeguards, the Commission decided to propose EU rules on the appropriate modalities and safeguards for cross-border access to electronic evidence, before engaging in negotiations with third parties.

               At the international level, discussions are taking place as part of the negotiations on a Second Additional Protocol to the Council of Europe Convention on Cybercrime
                  10
               . Cross-border access to electronic evidence has been a regular point on recent EU-U.S. Justice and Home Affairs Ministerial meetings.

               The two recommendations to open negotiations with the United States of America and to participate in the negotiations of the Second Additional Protocol to the Council of Europe Convention on Cybercrime are being adopted by the Commission at the same time. While the two processes will progress at a different pace, they address inter-linked issues and commitments taken in one negotiation may have a direct impact on other strands of negotiations.

               While the e-evidence proposals address the situation of specific types of service providers providing services on the EU market, there is a risk of conflicting obligations with laws in third countries. In order to address these conflicts of law, and in line with the principle of international comity, the e-evidence proposals include provisions for specific mechanisms in case a service provider is confronted with conflicting obligations deriving from the law of a third country when evidence is requested. These mechanisms include a review procedure to clarify such a situation. An EU-U.S. Agreement should aim to avoid conflicting obligations between the European Union and the United States of America.

               Major service providers holding relevant evidence for criminal investigations operate under U.S. jurisdiction. The Stored Communications Act of 1986 prohibited the disclosure of content data, whereas non-content data can be provided on a voluntary basis. The United States CLOUD Act (Clarifying Lawful Overseas Use of Data), adopted by United States Congress on 23 March 2018, clarifies through an amendment of the Stored Communications Act of 1986 that U.S. service providers are obliged to comply with U.S. orders to disclose content and non-content data, regardless of where such data is stored, including in the European Union. The CLOUD Act also allows the conclusion of executive agreements with foreign governments, on the basis of which U.S. service providers would be able to deliver content data directly to these foreign governments. The scope of data covered by the CLOUD Act is stored data and interception of wire or electronic communication, while the offences covered are “serious crimes”. The executive agreements with foreign governments are subject to certain conditions, that the foreign country has sufficient protections in place, including to restrict access to data related to U.S. citizens.

               The purpose of this initiative is to address, through common rules, the specific legal issue of access to content and non-content data held by service providers in the European Union or the United States of America. This initiative would, in the context of an international agreement, complement the EU’s electronic evidence proposals by addressing conflicts of law, in particular as regards content data and speeding up access to electronic evidence. This recommendation includes negotiating directives for the opening of negotiations on an EU-wide agreement with the United States of America on cross-border access to electronic evidence. The European Union has an interest in a comprehensive agreement with the United States of America, both from the perspective of protecting European rights and values such as privacy and personal data protection and from the perspective of our own security interests.

               In terms of content data, as outlined above, U.S. law (Stored Communications Act of 1986) as it currently stands, bars U.S. service providers from responding to requests from foreign law enforcement authorities. U.S. law currently requires that probable cause be shown before a Mutual Legal Assistance request from a third country can be executed. European Union Member State service providers cannot currently respond to direct requests from third country authorities. An EU-U.S. Agreement would complement the objective and the effectiveness of the e-evidence proposals, in particular when it comes to content data held by U.S. service providers in the United States of America. It would allow direct cooperation with a service provider by creating a more efficient legal framework for judicial authorities as EU practitioners currently face difficulties in obtaining content data through Mutual Legal Assistance requests.

               As regards non-content data, due to the growing number of Mutual Legal Assistance requests addressed to the United States of America, the U.S. authorities have encouraged EU law enforcement and judicial authorities to request non-content data from U.S. service providers directly, and U.S. law allows but does not require U.S.-based service providers to respond to such requests. An EU-U.S. Agreement would provide more certainty, clear procedural safeguards and reduce fragmentation for EU authorities to access non-content data held by U.S. service providers. It would also allow for reciprocal access by U.S. authorities to data held by EU service providers.

               The recommendation for a Council decision is to launch negotiations between the European Union and the United States of America, so that a transatlantic agreement can be reached on cross-border access to electronic evidence directly from service providers for use in criminal proceedings. It seeks to adapt cooperation mechanisms to the digital age, giving the judiciary and law enforcement tools to address the way criminals communicate today and to counter modern forms of criminality.

               An agreement between the European Union and the United States would offer a number of practical advantages:

               ·It would provide for reciprocal access for judicial authorities to content data;

               ·It would address access to non-content data on the basis of orders from judicial authorities, ensure reciprocal access by EU and U.S. authorities and review the conditions and safeguards for direct cooperation to service providers;

               ·It would contribute to improving timely access to data for judicial authorities;

               ·It would address the risk of conflicts of laws;

               ·It would reduce the risk of fragmentation of rules, procedures, and harmonise the rights and safeguards through a single negotiation mandate for all European Union Member States with the United States ensuring non-discrimination between European Union Member States and their nationals;

               ·It would clarify the binding nature and enforcement of orders on service providers while also detailing the obligations for judicial authorities.

               The agreement should be conditional on strong protection mechanisms for fundamental rights. These negotiating directives aim to improve legal certainty for authorities, service providers and persons affected, ensuring proportionality, protection of fundamental rights, transparency and accountability of both judicial authorities and service providers.

               3.
                     RELEVANT PROVISIONS IN THE POLICY AREA

               The current European Union legal framework consists of Union cooperation instruments in criminal matters, such as the Directive 2014/41/EU regarding the European Investigation Order in criminal matters
                  11
                (EIO Directive), the Convention on Mutual Assistance in Criminal Matters between the Member States of the European Union
                  12
               , Regulation 2018/1727 on Eurojust
                  13
               , Regulation (EU) 2016/794 on Europol
                  14
               , Council Framework Decision 2002/465/JHA on joint investigation teams
                  15
                and the proposed Regulation on preventing the dissemination of terrorist content online
                  16
               .

               On 17 April 2018, the Commission proposed to the Council and the European Parliament a Regulation on European Production and Preservation orders for electronic evidence in criminal matters
                  17
                and a Directive laying down harmonised rules on the appointment of legal representatives for the purpose of gathering evidence in criminal proceedings
                  18
               . Externally, the European Union has concluded a number of bilateral agreements between the Union and third countries, such as the Agreement on Mutual Legal Assistance (‘MLA’) between the European Union and the United States of America
                  19
               . This agreement is intended as a complement to these arrangements.

               Personal data covered by this recommendation for a Council decision is protected and may only be processed in accordance with the General Data Protection Regulation (GDPR)
                  20
                and for authorities in the European Union, the Data Protection Directive for Police and Criminal Justice Authorities (Law Enforcement Data Protection Directive)
                  21
               . The agreement should complement the EU-U.S. Data Protection and Privacy Agreement, otherwise known as the "Umbrella Agreement" which entered into force on 1 February 2017 and the U.S. Judicial Redress Act (JRA), extending the benefits of the U.S. Privacy Act to EU citizens that was adopted by the United States Congress on 24 February 2016.

               Electronic communications data covered by this recommendation for a Council decision is protected and can only be processed in accordance with the Directive 2002/58/EC (the ePrivacy Directive)
                  22
               .

               The agreement should respect the fundamental rights, freedoms and general principles of EU law as enshrined in the European Union Treaties and Charter of Fundamental Rights, procedural rights including right to an effective remedy and to a fair trial, presumption of innocence and right of defence, principles of legality and proportionality of criminal offences and penalties and any obligations incumbent on law enforcement or judicial authorities in this respect. As regards the necessary data protection safeguards for personal data transferred from the European Union to U.S. law enforcement authorities, the applicable provisions of the EU-U.S. Data Protection and Privacy Agreement will be complemented by additional safeguards to take into account the level of sensitivity of the categories of data concerned and the unique requirements of the transfer of electronic evidence directly by service providers.

               The agreement should also be without prejudice to other existing international agreements on judicial cooperation in criminal matters between authorities, such as the EU-U.S. Mutual Legal Assistance Agreement. The agreement should, in the bilateral relations between the United States of America and the European Union, take precedence over any agreement or arrangement reached in the negotiations of the Second Additional Protocol to the Council of Europe Convention on Cybercrime.

               The Council shall authorise the opening of negotiations, adopt negotiating directives and authorise the signing and conclusion of the agreement as set out in Article 218 (3) and (4) of the Treaty on the Functioning of the European Union.

               Fundamental rights

                  The agreement could potentially affect a number of fundamental rights:

               ·rights of the individual whose data is accessed: including right to protection of personal data; right to respect of private and family life, home and communications; right to freedom of expression and assembly; right to an effective remedy and to a fair trial, presumption of innocence and right of defence, principles of legality and proportionality of criminal offences and penalties;

               ·rights of the service provider: right to freedom to conduct a business; right to an effective remedy;

               ·rights to liberty and security of persons.

                  Taking into account the relevant privacy and data protection acquis, sufficient and important safeguards should be included in the agreement to ensure that the rights of these persons are protected in line with general principles of EU law and relevant case law of the European Court of Justice.

                  The EU-U.S. Agreement should be compatible with the Commission’s e-evidence proposals, including as they evolve in the legislative procedure and in their final adopted form.

                  The definitions of criminal proceedings for which such data could be obtained, the types of data covered, the requirements to issue an order, the judicial remedies and safeguards, and the scope of offences concerned will form an important part of the negotiations in order to avoid conflicts of law and improve access for authorities. The definitions and scope should be compatible with those of the EU-internal electronic evidence rules as they evolve.

                  The Commission believes that it is in the interest of both the European Union and United States of America to conclude a comprehensive agreement as this would provide legal clarity for judicial and law enforcement authorities from both sides and avoid conflicting legal obligations for service providers. This is also the only way to avoid that we have different rules for EU citizens and service providers depending on their nationality.

                  The agreement should clarify the binding nature and enforcement of orders on service providers, while the agreement should also define the obligations for judicial authorities.

                  In point 1 - 3 of the negotiating directives, the Commission proposes the three main objectives of the agreement, namely to set common rules and address conflicts of law for orders on content and non-content data, from a judicial authority in one contracting party, addressed to a service provider that is subject to the law of another contracting party; secondly, on the basis of such an order, to allow for a transfer of electronic evidence directly on a reciprocal basis by a service provider to a requesting authority and thirdly, ensure respect for the fundamental rights, freedoms and general principles of EU law as enshrined in the European Union Treaties and Charter of Fundamental Rights.

                  In point 4 of the negotiating directives, the Commission proposes that the agreement should apply to criminal proceedings which include both pre-trial and trial phases. It should be compatible with Article 3 of the proposed Regulation on European Production and Preservation Orders for electronic evidence in criminal matters. Both during the pre-trial and trial phase, all legal protections for the affected persons and in particular, criminal law procedural safeguards are applicable.

                  With point 5 of the negotiating directives, the Commission proposes that the agreement should create reciprocal rights and obligations of the parties to the agreement.

                  In point 6 of the negotiating directives, the Commission proposes that the agreement sets out the definitions and types of data that are to be covered, including both content and non-content data. Content data includes the content of the electronic exchange and is considered the most intrusive category of electronic evidence. Non-content data encompasses both subscriber data, which is the most frequently requested type of data for the purposes of criminal investigations, and traffic data which includes information on the identities of the senders and recipients of electronic messages and metadata including the timing, frequency and duration of the exchanges.

                  In point 7 of the negotiating directives, the Commission proposes that the agreement should define its exact scope of application in terms of the criminal offences covered and the thresholds of levels of penalties. It should be compatible with Article 5 (4) of the proposed Regulation on European Production and Preservation Orders for electronic evidence in criminal matters. The issuing authority should be required to ensure in the individual case that the measure is necessary and proportionate, including in view of the gravity of the offence under investigation. The agreement should include appropriate thresholds of levels of penalties for content and non-content data. It should be compatible with the three-year threshold, which limits the scope of the instrument to more serious crimes, without excessively limiting the possibilities of its use by practitioners.

                  The Commission proposes in point 8 of the negotiating directives that the agreement should set out what are the conditions to be met before a judicial authority can issue an order and the ways in which an order can be served. It should be compatible with Article 5 on conditions for issuing an order of the proposed Regulation on European Production and Preservation Orders for electronic evidence in criminal matters.

                  In point 9 of the negotiating directives, the Commission proposes that the agreement should include a clause enabling effective judicial remedies for suspects and accused persons during the criminal proceedings. The agreement should also define in which circumstances a service provider has the right to object to an order. For affected persons, the baseline for these provisions are Article 17 of the proposed Regulation on European Production and Preservation Orders for electronic evidence in criminal matters which ensures that persons affected by the European production order have effective remedies in accordance with national law, normally during the criminal proceedings. Remedies of data subjects are also defined in in Directive (EU) 2016/680 and Regulation (EU) 2016/679. As the order is a binding measure, it may also affect the rights of service providers, in particular the freedom to conduct a business and the conditions for this. The Commission proposes that the agreement should include a right for the service provider to raise certain claims in the issuing State, for example if the order has not been issued or validated by a judicial authority.

                  In point 10 of the negotiating directives, the Commission proposes that the agreement should define the time period for supplying the data covered by the order. It should be compatible with Article 9 of the proposed Regulation on European Production and Preservation Orders for electronic evidence in criminal matters which obliges addressees to reply in a normal deadline of 10 days, while authorities may set a shorter deadline where justified.

                  The Commission proposes in point 11 of the negotiating directives that the agreement should be without prejudice to other existing international agreements on judicial cooperation in criminal matters between authorities, such as the EU-U.S. Mutual Legal Assistance Agreement.

                  In point 12 of the negotiating directives the Commission proposes that the agreement should, in the bilateral relations between the European Union and the United States of America take precedence over the Council of Europe Convention on cybercrime and any agreement or arrangement reached in the negotiations of the Second Additional Protocol to the Convention, in so far as the provisions of the latter agreement or arrangement cover issues dealt with by this agreement.

                  In point 13 of the negotiating directives, the Commission proposes that the agreement should be reciprocal in terms of the categories of persons whose data must not be requested pursuant to this agreement. The agreement should not discriminate between persons from different European Union Member States. The Commission considers that this agreement, which is of EU-wide application, is one safeguard to achieve this requirement.

                  Points 14-16 of the directives cover the data protection safeguards required for this specific agreement. Point 14 of the negotiating directives states that the agreement should make applicable by reference the EU-U.S. Data Protection and Privacy Agreement, otherwise known as the "Umbrella Agreement". In point 15 the Commission states that the agreement should complement the Umbrella Agreement with additional safeguards that take into account the level of sensitivity of the categories of data concerned and the unique requirements of the transfer of electronic evidence directly by service providers rather than between authorities. Point 16 sets out the additional safeguards that the Commission proposes as required for this agreement including the specification of the purpose, the purpose limitation, notification and onward transfer.

                  Point 17 of the negotiating directives covers the additional procedural rights that the Commission proposes will be required to take account of the unique requirements of the transfer of electronic evidence directly by service providers rather than between authorities. These include that the data may not be requested for the use in criminal proceedings that could lead to the death penalty, the proportionality of orders, and specific safeguards for data protected by privileges and immunities. Immunities and privileges of certain professions such as lawyers, as well as fundamental interests of national security or defence in the State of the addressee must also be taken into account during trial in the issuing State. The review by a judicial authority serves as a further safeguard here.

               In the governance provisions in points 18-23, the Commission proposes in the negotiating directives that the agreement includes periodic joint reviews of application of the agreement and a clause on its duration. It is also proposed that the agreement stipulates that the parties consult each other to facilitate resolution of any dispute regarding interpretation or application of the agreement. Statistics should be collected on both sides to facilitate the review process. In addition, the negotiating directives propose that the future agreement includes a suspension and termination clause in the event that the consultation procedure is unable to resolve the dispute.

               Recommendation for a

               COUNCIL DECISION

               authorising the opening of negotiations in view of an agreement between the European Union and the United States of America on cross-border access to electronic evidence for judicial cooperation in criminal matters

               THE COUNCIL OF THE EUROPEAN UNION,

               Having regard to the Treaty on the Functioning of the European Union, and in particular Article 218(3) and (4) thereof,

               Having regard to the recommendation from the European Commission,

               (1)
                     On 17 April 2018, the Commission submitted legislative proposals for a Regulation on European Production and Preservation orders for electronic evidence in criminal matters and a Directive laying down harmonised rules on the appointment of legal representatives for the purpose of gathering evidence in criminal proceedings ("e-evidence proposals")
                  23
               . The Council agreed on a general approach on the Commission proposal for the regulation at the Justice and Home Affairs Council on 7 December 2018
                  24
               .

               (2)
                     Negotiations should be opened with a view to concluding an agreement between the Union and the United States of America on cross-border access by judicial authorities in criminal proceedings to electronic evidence held by a service provider.

               (3)
                     The agreement should include the necessary safeguards for fundamental rights and freedoms and observe the principles recognised by the Charter of Fundamental rights of the European Union, in particular the right to private and family life, home and communications recognised in article 7 of the Charter, the right to protection of personal data recognised in Article 8 of the Charter, the right to effective remedy and fair trial recognised in Article 47 of the Charter, the presumption of innocence and right of defence recognised in Article 48 of the Charter and principles of legality and proportionality of criminal offences and penalties recognised in Article 49 of the Charter. The agreement should be applied in accordance with those rights and principles.

               (4)
                     The European Data Protection Supervisor was consulted in accordance with Article 42(1) of Regulation (EU) 2018/1725 of the European Parliament and of the Council
                  25
                and delivered an opinion on …
                  26

               HAS ADOPTED THIS DECISION:

               Article 1

               The Commission is hereby authorised to negotiate, on behalf of the Union, an agreement between the Union and the United States of America on cross-border access by judicial authorities in criminal proceedings to electronic evidence held by a service provider.

               Article 2

               The negotiating directives are set out in the Annex.

               Article 3

               The negotiations should be conducted in consultation with a special committee to be designated by the Council.

               Article 4

               This decision is addressed to the Commission.

               Done at Brussels,

                     For the Council

                     The President

                     (1)

                        Review of the 2010 EU-U.S. Mutual Assistance Agreement, 7 April 2016, 7403/16.

                     (2)

                        Content data may only be obtained on a voluntary basis in cases considered to be an emergency involving danger of death or serious physical injury to any person.

                     (3)

                        Section 2701(2) of the Electronic Communications and Privacy Act 1986 (ECPA) 41.

                     (4)

                        The case was heard by the US Supreme Court on February 27 2018. The Court dismissed the case on 17 April 2018, after being informed by the parties that the CLOUD Act had been signed into law enabling a new warrant to be issued to obtain the requested information from Microsoft.

                     (5)

                        Commission Impact Assessment accompanying the electronic evidence package, 17 April 2018, SWD(2018) 118 final.

                     (6)

                        Communication from the Commission to the European Parliament and Council: The European Agenda on Security, 28 April 2015, COM(2015) 185 final.

                     (7)

                        Proposal for a Regulation of the European Parliament and of the Council on European Production and Preservation Orders for electronic evidence in criminal matters, 17 April 2018, COM(2018) 225 final.

                     (8)

                        Proposal for a Directive of the European Parliament and of the Council laying down harmonised rules on the appointment of legal representatives for the purpose of gathering evidence in criminal proceedings, 17 April 2018, COM(2018) 226 final.

                     (9)

                        While negotiations with the European Parliament and the Council are ongoing, the Council agreed a general approach on the Commission proposal for a Regulation at the Justice and Home Affairs Council on 7 December 2018.

                     (10)

                        Council of Europe Budapest Convention on Cybercrime (CETS N° 185), 23 November 2001,
                  http://conventions.coe.int

                     (11)

                  Directive 2014/41/EU
                   of the European Parliament and of the Council of 3 April 2014 regarding the European Investigation Order in criminal matters, OJ L 130, 1.5.2014, p.1.

                     (12)

                  Council Act of 29 May 2000
                   establishing in accordance with Article 34 of the Treaty on European Union the Convention on Mutual Assistance in Criminal Matters between the Member States of the European Union.

                     (13)

                        Regulation (EU) 2018/1727 of the European Parliament and of the Council of 14 November 2018 on the European Union Agency for Criminal Justice Cooperation (Eurojust), and replacing and repealing Council Decision 2002/187/JHA.

                     (14)

                  Regulation (EU) 2016/794
                   of the European Parliament and of the Council of 11 May 2016 on the European Union Agency for Law Enforcement Cooperation (Europol) and replacing and repealing Council Decisions 2009/371/JHA, 2009/934/JHA, 2009/935/JHA, 2009/936/JHA and 2009/968/JHA.

                     (15)

                  Council Framework Decision 2002/465/JHA
                   of 13 June 2002 on joint investigation teams.

                     (16)

                        Proposal for a Regulation on preventing the dissemination of terrorist content online, 12 September 2018, COM(2018) 640 final

                     (17)

                        Proposal for a Regulation of the European Parliament and of the Council on European Production and Preservation Orders for electronic evidence in criminal matters, 17 April 2018, COM(2018) 225 final

                     (18)

                        Proposal for a Directive of the European Parliament and of the Council laying down harmonised rules on the appointment of legal representatives for the purpose of gathering evidence in criminal proceedings, 17 April 2018, COM(2018) 226 final.

                     (19)

                  Council Decision 2009/820/CFSP
                   of 23 October 2009 on the conclusion on behalf of the European Union of the Agreement on extradition between the European Union and the United States of America and the Agreement on mutual legal assistance between the European Union and the United States of America.

                     (20)

                  Regulation (EU) 2016/679
                  of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC.

                     (21)

                  Directive (EU) 2016/680
                  of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention, investigation, detection or prosecution of criminal offences or the execution of criminal penalties, and on the free movement of such data, and repealing Council Framework Decision 2008/977/JHA.

                     (22)

                        Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector (Directive on privacy and electronic communications) (OJ L 201, 31.7.2002, p.37), amended by Directive 2009/136/EC of the European Parliament and of the Council of 25 November 2009 amending Directive 2002/22/EC on universal service and users’ rights relating to electronic communications networks and services, Directive 2002/58/EC concerning the processing of personal data and the protection of privacy in the electronic communications sector and Regulation (EC) No 2006/2004 on cooperation between national authorities responsible for the enforcement of consumer protection laws.

                     (23)

                        Proposal for a Regulation of the European Parliament and of the Council on European Production and Preservation Orders for electronic evidence in criminal matters, 17 April 2018, COM(2018) 225 final. Proposal for a Directive of the European Parliament and of the Council laying down harmonised rules on the appointment of legal representatives for the purpose of gathering evidence in criminal proceedings, 17 April 2018, COM(2018) 226 final.

                     (24)

                        Regulation of the European Parliament and of the Council on European production and preservation orders for electronic evidence in criminal matters, Council General Approach, ST 15292 2018 INIT, 12 December 2018

                     (25)

                        Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC  (OJ L295, 21.11.2018, p. 39).

                     (26)

                        OJ C ….

    ---documentbreak---

               EUROPEAN COMMISSION
            Brussels, 5.2.2019
            COM(2019) 70 final
            ANNEX
            to
            the Recommendation for a COUNCIL DECISION
            authorising the opening of negotiations in view of an agreement between the European Union and the United States of America on cross-border access to electronic evidence for judicial cooperation in criminal matters

               ANNEX

               1.OBJECTIVES

               The Commission should, in the course of the negotiations, aim to achieve the specific objectives set out in detail below, while ensuring that the outcome of the negotiations is compatible with the Union’s internal rules on electronic evidence, including as they evolve in the legislative procedure by the Union co-legislators and eventually in their final adopted form. These internal rules will serve as the baseline for the Union's negotiating position.

               1.Set common rules and address conflicts of law for orders for obtaining electronic evidence in the form of content and non-content data, from a judicial authority in one contracting party, addressed to a service provider that is subject to the law of  the other contracting party. This should reduce the risk of fragmentation of practices and legal rules and enhance legal certainty between the Union and the United States of America when obtaining electronic evidence in criminal proceedings.

               2.Allow for a transfer of electronic evidence directly on a reciprocal basis by a service provider to a requesting authority as set out in paragraph 1.

               3.Ensure respect for the fundamental rights, freedoms and general principles of EU law as enshrined in the European Union Treaties and Charter of Fundamental Rights, including proportionality, procedural rights, the presumption of innocence and the rights of defence of persons subject to criminal proceedings as well as privacy and the protection of personal data and communications data when such data is processed, including transfers to law enforcement authorities in third countries, and any obligations incumbent on law enforcement and judicial authorities in this respect.

               To achieve the objectives set out in part 1, the agreement should address in particular the following elements:

               2.NATURE AND SCOPE OF THE AGREEMENT

               4.The agreement should apply to criminal proceedings which include both pre-trial and trial phases.

               5.The agreement should create reciprocal rights and obligations of the parties.

               6.The agreement should set out the definitions and types of data that are to be covered, including both content and non-content data.

               7.The agreement should define its exact scope of application in terms of the criminal offences covered and the thresholds.

               8.The agreement should set out what the conditions are to be met before a judicial authority can issue an order and the ways in which an order can be served.

               9.The agreement should include a clause enabling effective judicial remedies for data subjects during criminal proceedings. The agreement should also define in which circumstances a service provider has the right to object to an order.

               10.The agreement should define the time period for supplying the data covered by the order.

               11.It should be without prejudice to other existing international agreements on judicial cooperation in criminal matters between authorities, such as the EU-U.S. Mutual Legal Assistance Agreement.

               12.The agreement should, in the bilateral relations between the Union and the United States of America, take precedence over the Council of Europe Convention on Cybercrime and any agreement or arrangement reached in the negotiations of the Second Additional Protocol to the Council of Europe Convention on Cybercrime, in so far as the provisions of the latter agreement or arrangement cover issues dealt with by the agreement.

               3.SAFEGUARDS

               13.The agreement should be reciprocal in terms of the categories of persons whose data must not be requested pursuant to this agreement. The agreement should not discriminate between persons from different Member States.

               14.The agreement should make applicable by reference the EU-U.S. Data Protection and Privacy Agreement, otherwise known as the "Umbrella Agreement", which entered into force on 1 February 2017.

               15.The agreement should complement the Umbrella Agreement with additional safeguards that take into account the level of sensitivity of the categories of data concerned and the unique requirements of the transfer of electronic evidence directly by service providers rather than between authorities.

               16.The additional privacy and data protection safeguards, to be reviewed subject to the scope of the agreement, should include inter alia:

               (a)The specification of the purposes for which personal data and electronic communications data may be requested and transferred.

               (b)The requirement that the order is limited to personal data and electronic communications data that is necessary and proportionate in relation to the purposes for which they are accessed.

               (c)The requirement that use by and disclosure to other U.S. authorities not bound by the Umbrella Agreement is subject to notification to, and prior authorisation by the competent judicial authority designated in the Member State in which the service provider is established or represented and may only take place if it is ensured that the receiving authority effectively protects the personal data and electronic communications data in line with the provisions of the agreement. When considering such prior authorisation, the competent judicial authority should take due account of all relevant factors, including the seriousness of the offence and the purpose for which the data is initially transferred.

               (d)The requirement that onward transfers to other third countries may only be made to law enforcement authorities responsible for the prevention, investigation, detection or prosecution of criminal offenses, including terrorism, and should be subject to notification to, and prior authorisation by the competent judicial authority designated by the Member State in which the service provider is established or represented. When considering such prior authorisation, the competent judicial authority should take into account the factors as set out in Article 7(2) of the Umbrella Agreement.

               (e)The agreement may consider the exceptional circumstances and the safeguards required where onward transfer may take place without prior authorisation, in case of serious and imminent threat to public security of a Member State or a third country.

               (f)The notification of an information security incident to the competent authority designated by the Member State in which the service provider is established or represented shall be made under the conditions of Article 10(2) of the Umbrella Agreement.

               17.The additional procedural rights safeguards, to be reviewed subject to the scope of the agreement, should include inter alia:

               (a)The appropriate safeguards to ensure that data may not be requested for the use in criminal proceedings that could lead to the death penalty.

               (b)The adequate conditions to ensure necessity and proportionality of orders for access to electronic evidence, distinguishing in particular between data categories as appropriate.

               (c)The procedural safeguards for individuals subject to a data order in the framework of criminal proceedings.

               (d)The specific safeguards for data protected by privileges and immunities,

               (e)The confidentiality safeguards for authorities and service providers, including non-disclosure requirements.

               4.GOVERNANCE OF THE AGREEMENT

               18.The agreement should stipulate that the parties shall undertake periodic joint reviews of application of the agreement and examine how to make most effective use thereof. For this purpose, statistics should be collected on both sides to facilitate this process.

               19.The agreement should include a clause on its duration. Whether the duration is to be indefinite or definite shall be assessed in the light of the results of negotiation. In either case, a provision should be included requiring a review of the agreement in due course.

               20.The agreement should stipulate that the parties should consult each other to facilitate resolution of any dispute regarding interpretation or application of the agreement.

               21.The agreement should provide for the possibility of suspension and termination of the agreement by either Party in the event that the above-mentioned consultation procedure is unable to resolve the dispute.

               22.The agreement should include a clause addressing its territorial application.

               23.The agreement will be equally authentic in all official Union languages.