1. EU-Japan FTA negotiations – The European rail industry perspective after two years EESC Seminar "EU-Japan Free Trade Agreement: an ambitious deal to boost both growth and jobs" 15 July 2015

2. What is UNIFE? Associated members: 15 National Associations, representing almost 1,000 suppliers of railway equipment + EFRTC and UNISIG A showcase industry for Europe: UNIFE members account for nearly half of the world market for rail products and a market share of 84% in Europe UNIFE represents the European Rail (Supply) Industry Based in Brussels since 1992 A trusted partner of European institutions in all matters related to transport Full members: Around 80 of the largest and medium-sized companies in the rail supply sector

3. Our Members

4. Growth in the rail supply market 2017-2019 Source: Roland Berger World Rail Market Study, 2014 JAPAN is a market with strong potential for the EU rail industry (total market volume 2011-2013: EUR 5.8 Bn)

5. A significant market but limited opportunities due to a lack of level-playing field -Intercity Express Program (£6 Bn i.e. biggest rail contract ever awarded in the UK) -Javelin trains (£370 M) -ScotRail… -Only 2% of rail market open according to international procurement rules -Value of rolling stock imported from abroad: only 0.03% UNIFE POSITION: A LEVEL PLAYING FIELD MUST BE ENSURED

6. Reminder: Obstacles faced by the European rail industry The WTO GPA ‘Operational Safety Clause’ (OSC) enables Japanese GPA-covered entities not to abide GPA procurement disciplines without any justification Complex and restrictive procurement procedures in the supply of railway equipment (pre-qualification system), promoting de facto Japanese suppliers Technical difficulties to understand and access the market due to a multiplicity of systems (standards, testing etc.)  Consequences: No transparency and discrimination on the rail market

7. UNIFE and market access in Japan: A long story Before the FTA negotiations 2008-2009: Launch of UNIFE initiative 2010-2011: EU-Japan railway safety workshops and « industry dialogue » December 2011: Review of WTO GPA, exchange of letters on rail Since the launch of the FTA negotiations March 2013: Launch of the EU-Japan FTA negotiations, with a ‘roadmap on railways and urban transport’ (scoping exercise) June 2014: Review clause and decision to pursue EU-Japan FTA negotiations based on Member States’ assessment October 2014: Enforcement of the ‘one-year package’ of measures on railways December 2014: Start of the discussions on market access 7

8. Unilateral commitment made by the Japanese government in December 2011, but progress is clearly not sufficient for the European industry in spite of 9 rounds of negotiations, 2 Railway Industrial Dialogues (third planned on 21 May)… The ‘one-year package’, in force since October 2014, is only a first step towards more transparency and does not solve fundamental issues such as the OSC (still no specific technical work on this!) In terms of business, concrete and significant signs of opening are still very limited and the EU industry is expecting more progress to achieve a suitable business framework in Japan (especially for rolling stock) State of play of rail discussions in the FTA

9. 1. The EU and Japan should find a common understanding on the safety requirements linked to the OSC so that EU suppliers can understand and meet these requirements 2. More transparent and non-discriminatory public procurement procedures should be guaranteed, with the establishment of open tendering for commercially viable projects 3. Progress should be made on testing, certification and standards to facilitate business of EU suppliers in Japan 4. An ambitious public procurement chapter with broader public procurement coverage on a reciprocal basis and solving of discriminatory practices/requirements FTA negotiations – Industry messages

10. UNIFE – Promote rail market growth for sustainable mobility