German court rejects emergency appeal to block EU-Canada trade deal

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[October 13, 2016]  By Caroline Copley

BERLIN (Reuters) - Germany's Constitutional Court cleared the government on Thursday to approve a trade accord between the European Union and Canada under defined conditions, boosting the agreement's chances of passing an EU vote next week.

The court in Karlsruhe rejected emergency appeals by activists to prevent the government from backing the Comprehensive Economic and Trade Agreement (CETA) before it has been ratified by national parliaments.

The court - Germany's highest - said the government must ensure that only parts of CETA within the competence of the European Union, such as the removal of tariffs, should be allowed to apply provisionally - meaning before it is ratified by EU member states.

This means that a system of investor protection also envisaged in the accord - which opponents say will hand too much power to multinationals - may only come into force following ratification by national parliaments.

Court president Andreas Vosskuhle also said it must be possible for Germany to unilaterally terminate the provisional application of the accord - effectively inserting a safety clauses allowing the government to back out of the deal if it contravened Germany's constitution.

Economy Minister Sigmar Gabriel, who has championed the agreement as Europe's best chance to shape the changing rules of global trade, said the ruling paved the way towards ratifying CETA.

"I am very pleased that we have made a first big step, because if Europe were not able to deal with Canada, this would send a difficult signal in the world," he said.

FAR FROM CERTAIN

Widely seen as a possible blueprint for TTIP, a larger trade deal the EU has been negotiating with the United States, CETA aims to eliminate tariffs on 98 percent of goods immediately.

CETA also encompasses regulatory cooperation, shipping, sustainable development and access to government tenders.

EU trade ministers are due to vote on the accord next week and Brussels and Ottawa then hope to sign it on Oct. 27.

But its final approval is far from certain, as it requires unanimous support from member states and the European Parliament would also need to vote to allow parts of it to go into force.

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Protesters of BUND, a German non-governmental organisation (NGO) dedicated to preserving nature and protecting the environment, protest against CETA in front of the Chancellery in Berlin, Germany, October 12, 2016. REUTERS/Stefanie Loos

Activists also welcomed the German court's ruling, calling it "a slap in the face" for the government.

"The court is not simply waving through the provisional application but has formulated strict requirements. This shows that the government has taken the implications of the agreement for democracy far too lightly," said Thilo Bode of consumer rights organization foodwatch.

Opponents argue the deal is undemocratic and will undermine workers' rights and worsen standards for consumers.

The accord still faces headwinds from elsewhere in Europe.

Southern Belgium is set to block the deal, while backing from Slovenia remains uncertain.

Austria's chancellor, who has expressed strong objections to CETA, said his decision on whether to back the deal would depend to a large extent on the German court's ruling. Earlier on Thursday he struck a conciliatory tone, saying many of his concerns had been addressed in an additional declaration.

(Reporting by Caroline Copley; Editing by Alison Williams and John Stonestreet)

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