Implementing and Enhancing Labour Standards Through FTAs? A Critical Analysis of the Panel Report in the EU-Korea Case

Abstract

The EU has been a long-time advocate of including labour provisions in trade agreements. The labour provisions in the EU’s Free Trade Agreements (FTAs) have gone through intergenerational development and become a staple practice. Moreover, recent years witnessed the EU’s strengthened enforcement of labour commitments made in FTAs by trade partners. In 2018, the EU initiated a dispute settlement process against Korea based on the EU-Korea FTA, which is the first and, up to now, the only case on alleged violations of labour provisions in an EU FTA. In the published report, the Panel makes findings on three key jurisdictional and substantive issues: the requirement of a trade-labour linkage, the incorporation of International Labour Organization (ILO) labour standards into the FTA, and the obligation to ratify the fundamental ILO Conventions. Based on a critical analysis, the Panel’s decisions arguably not only left much to be desired at the technical level, but may exert an unpleasant effect on the development of the relationship between labour protection and FTAs. Nevertheless, the EUKorea case provides an important opportunity to revisit the appropriateness of using FTAs to implement and enhance labour standards, including enforcing labour provisions through a dispute settlement process. Dispute Settlement, Free Trade Agreements, Labour Standards, The EU-Korea Labour Dispute, Trade-Labour Linkage