To Advance Trade Policy, Strengthen the Role of Parliaments

In trade policy, parliaments generally play a lesser or even inexistent role. Strengthening their involvement can advance trade policymaking and help better align it with the public interest. This enhanced role should span the whole policy process. It should start before the beginning of negotiations over new trade agreements, continue through the negotiations, and extend to the implementation and updating of agreements. Such an enhanced role is becoming even more important as global trade cooperation is shifting and geopolitical considerations are moving up policy agendas.

To advance trade policy, it is important to strengthen the role of parliaments. In many cases, parliaments’ power to affect trade policy is severely limited. In fact, trade policy is an anomaly within the democratic system as it is often the executive that proposes, negotiates, and implements trade agreements with other countries. The role of parliaments in these processes is often secondary or even inexistent. This is problematic and needs to change.

The role of parliaments in trade policy: not the same everywhere

Not all democracies start at the same point in this endeavor. The UK and Switzerland provide examples of weak legislative oversight over trade policy. The UK parliament has only a very limited say in trade negotiations. It can express a non-binding objection to the ratification of certain agreements. But beyond this, its role is largely restricted to implementing agreements that the government negotiated and signed. The Swiss parliament has somewhat more influence as it has a binding vote on whether to accept a finalized trade agreement. Prior to that point, however, the discretion of the executive is large: it is the Swiss Federal Council that decides if and when to enter into negotiations, it sets the negotiation mandate – which is not published – and it largely decides on its own when and how to inform parliament or the public.

In the European Union (EU), parliament not only has the formal power to consent to or reject trade agreements but also the right to be immediately and fully informed at all stages of trade negotiations. At least in part, this latter right has helped the EU Parliament overcome its otherwise limited formal powers, especially during the mandating and negotiation stage. On the information side, the parliament has increasingly relied on its Support Services to provide expert insight, it is being kept abreast of how draft mandates develop through oral briefings, and it has used freedom of information requests to gain access to final mandates. In recent years, the European Commission and the Council have also opted to make these documents public in general. And, though lacking any formal powers to influence the negotiating mandate or negotiations themselves, the EU Parliament has begun to voice its opinion early on through resolutions on matters that it deems important. Further processes can also support parliaments’ access to information. During the negotiations phase, for example, independent consultants prepare a Sustainability Impact Assessment (SIA) on the agreement. These SIAs also include an open call for input on the drafts, consultations, and sometimes workshops or roundtables, and they are published before negotiations conclude. During the implementation phase of FTAs, the EU has begun to publish agendas and reports of committee meetings. And typically 5 years after an agreement has entered into force, an ex-post evaluation is prepared with input from civil society.

The United States Congress stands out for its power in trade matters. In contrast to the jurisdictions highlighted above, it is officially in charge of trade. Still, to ease negotiations, it has often delegated the ability to negotiate trade agreements to the executive branch through the “Trade Promotion Authority” (TPA). Among others, the TPA defines negotiation objectives for the President, prescribes when and how Congress needs to be notified and consulted, and sets limits on the executive’s authority. In the last TPA, during negotiations, Members of Congress (from both the majority and the minority party) were able to become official advisers to the U.S. negotiating delegations and thus gain direct insight into the negotiations themselves. After the conclusion of negotiations, and as long as the negotiated agreement meets the stipulations of the TPA, the agreement benefits from a so-called “fast-track” procedure. This leaves Congress with only a short debate time and a simple up or down vote. Yet if a negotiated agreement strays from the TPA’s stipulations, Congress can add amendments and filibuster its passage. Thus, the TPA is a strong incentive for the executive to negotiate within its scope. Moreover, the TPA can be withdrawn or not renewed. The last TPA expired in 2021. Congressional discussions of specific trade agreements are informed, inter alia, by expert commentary from the U.S. International Trade Commission (USITC) and from official advisory committees on trade with representatives from sub-national governments, labor, business, environmental, and other stakeholders.

Principles for greater parliamentary involvement

Parliamentary involvement is important throughout the lifecycle of trade agreements, starting before negotiations and continuing also after negotiations have been concluded. To that end, a few key principles for the role of parliaments in trade policy are critical:

• Build capacity

  To support informed debates over trade policy, parliaments need to ensure that they have the appropriate information and expertise at hand. The committees that deal with trade agreements need expert support to be able to sift through the agreements (that can be in the hundreds and even thousands of pages) to effectively scrutinize essential matters. They also need to work with other parliamentary committees as trade agreements affect many policy areas, e.g., regulation affecting domestic labor, environmental, and tax policy. Important information that can highlight pressing areas and aid parliaments in their work can also come from processes outside of parliament. Examples from the EU and US, as outlined above, are the SIAs, public consultations, and expertise provided by independent bodies of experts.

• Define the goals of trade policy

  At the start of the process, parliaments should set the general objectives for trade policy and any trade agreements to be negotiated, participate in drafting mandates for specific negotiations and vote on them, and debate the initial text proposal. To lay out the general objectives of trade policy, as in the US with the TPA, parliaments should define core principles and objectives for trade policy and any agreements to be negotiated. In preparation for specific negotiations, parliaments should be able to debate and vote on the negotiating mandate. And in order for parliament to fulfil its supervisory duty in trade negotiations, as in the EU, the executive should publish the initial text proposals. Parliaments, in turn, should be able to debate these and, if not deemed in line with the general objectives, demand changes.

• Accompany negotiations

  Parliaments need to be effectively informed about ongoing negotiations. While negotiators need leeway to negotiate, it is important that parliaments be informed about ongoing negotiations. A prime example for this is the US Congress’ ability to include members as advisors in trade negotiation delegations. As a rule, information should be public unless confidentiality is of overriding importance. For texts deemed confidential, solutions exist, too. In the EU, for example, parliamentarians and select advisory groups can read and respond to these in secure environments, subject to rules on non-disclosure.

  Parliaments need to be informed if negotiated concessions threaten to deviate substantially from the defined objectives of trade policy or from the mandate. This should also happen if concessions would substantially change existing law. For both of these cases it is important that parliaments – as for example in the US through its tools in the TPA – have a clear way to address these developments.

• Ratify agreements and oversee implementation

  All of these powers of parliament need to be underpinned by the right of parliaments to bindingly vote on the final agreement and on any associated or renegotiated texts. Parliaments need to be in a position to not only vote on the final agreement, they also need to have the leeway to extend this power to any associated and renegotiated texts. These include Memoranda of Understanding, side letters, or other documents referred to in the agreement. As their number could potentially be large, it is important that parliaments create a process to identify which associated texts need to be scrutinized more closely. 

  Parliaments need to retain influence also over ongoing cooperation after agreements have been ratified. Trade agreements tend to increasingly institute independent bodies that continue to update and even deepen commitments over time. Generally, these are also outside of the purview of parliamentary oversight. It is thus important that parliaments institute ways to be kept abreast of work in these commitees, e.g., through access to information or representation in these bodies. Such independent bodies should publish their agendas and meeting reports, or at least share them with the relevant parliamentary committees. If parliaments deem it necessary, they should be able to vote on any updates or amendments in trade agreements.

Aligning Public Interests with International Trade Cooperation

Enhancing the role of parliaments in trade negotiations can strengthen domestic support for trade and international cooperation. Not all trade agreements are the same. It matters whether the commitments in agreements represent only a small set of particular interests or a comprehensive range of public policy goals. To reflect the latter, parliamentary debates are an important tool. They can strengthen democratic consensus and better align trade policy and agreements with the goals of broad-based sustainable prosperity. The above-mentioned principles for parliamentary involvement are thus also critical to secure public support among the signatories and strengthen international cooperation.

Strengthening parliamentary participation becomes even more important against the background of a changing geopolitical landscape. Trade cooperation globally is both weakening in some areas and strengthening in others. Trade restrictions, such as local content requirements, are on the rise. At the same time, new areas of cooperation are emerging, including some formerly deemed outside of trade. Cases in point are the international cooperation on environmentally damaging subsidies in the WTO’s Fisheries Agreement or the recently concluded plurilateral negotiations for an Agreement on Climate Change, Trade and Sustainability.

In this situation of changing patterns of cooperation, it is even more important to enhance and advance trade policy. To achieve this, strengthening the role of parliaments is key. 

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