Towards a Legal Framework for Transnational Company Agreements

This Report deals primarily with EU law and attempts to offer legal perspectives to the controversial issue of Transnational Company Agreements (TCAs), in order to suggest an optional legal framework for agreements enforceable within the boundaries of the EU. However, references to international law will also be offered, in order to broaden the horizon of our work and add viewpoints to potential options in policy-making. This approach is related to the fact that TCAs are signed by Transnational Companies (TCs) and the latter operate within the EU as well as outside of it. Over the last decade, the number of TCAs has increased among TCs having their seat within the European Union, illustrating the Europeanization of industrial relations. In August 2013, the TCA database set up by European Commission has registered more than 230 agreements. TCAs have been negotiated in the absence of a specific legal framework. To a certain extent, this situation has certainly worked as an incentive to the development of TCAs, since the social partners enjoyed huge flexibility to explore innovative forms of negotiation. On the other hand, the lack of a specific legal framework for TCAs raises several questions regarding the negotiation process, the actors involved, the content of TCAs and their implementation. This report to the European Trade Union Confederation aims at discussing the opportunities to develop an optional legal framework for TCAs and at defining the legal basis and the content of such a framework, as well as suggesting the steps that may lead to its adoption. The report takes into account both academic literature and political documents produced. Moreover, interviews have been conducted with several representatives from transnational companies and European union federations involved in the negotiation and implementation of TCAs. The report is structured into 5 sections (section I-V). After this introduction, section II builds on recent policy documents, in order to summarize the different legal problems at stake in the field of TCAs. Section III outlines the sources in primary EU law, relevant for supporting an optional legal framework for TCAs . Section IV contains and explains our proposal, i.e. the adoption of a Decision addressed to Member States, defining rules for the conclusion of TCAs and disputes settlement. Finally, in section V suggestions are made on initiatives to take in order to move forward towards the adoption of an optional legal framework for TCAs. The annex includes a presentation of the main outcomes of the interviews we conducted to support our proposal.