The Council of the European Union has approved the Interim Trade Agreement (iTA) with Chile, ending the EU's internal ratification process and setting the stage for its implementation. This agreement, which focuses on trade and investment liberalization, an exclusive competence of the EU, operates in parallel with the investment protection provisions of the Advanced Framework Agreement (AFA), which still needs to be ratified by the Member States. The iTA will cease to exist once the AFA is fully ratified. Both agreements seek to update the current relationship between the EU and Chile, strengthen political and economic ties, and intensify cooperation and trade.
The European Union is Chile's third largest trading partner and the agreement will exempt about 99.9% of EU exports to Chile from tariffs after it enters into force, which could increase EU exports to Chile by up to 4,500 million euros. The agreement will facilitate access to essential resources for the transition to a green economy, such as lithium, copper, and hydrogen. It will also allow European companies to offer services in Chile in sectors such as delivery, telecommunications, maritime transport, and financial services. In addition, it will level the playing field for investors from both territories in Chile and improve access to public tenders for companies from the EU and Chile.
One chapter of the agreement is dedicated to SMEs, seeking to reduce bureaucracy and ensure that these companies fully benefit from the agreement. The ratification of the iTA by the EU, which does not require the ratification of individual member states, allows the agreement to enter into force once Chile completes the ratification process. The agreement will be activated on the first day of the third month following the notification by both parties of the completion of their internal procedures. The iTA is only valid until the AFA (which must be ratified by all EU member states) enters into force.
Source: simfruit.cl