Not That Assertive: The EU’s Take on Enforcement of Labour Obligations in Its Free Trade Agreement with South Korea

In 2011, the European Union (EU) concluded the first of a ‘new generation’ of free trade agreements that contained a separate chapter with obligations relating to ‘trade and sustainable development’ (TSD) issues. This was the Free Trade Agreement with the Republic of Korea. The EU formally initiated its first TSD complaint, under this agreement, in 2018. This labour complaint came after a non-paper of the European Commission promised ‘more assertive’ use of the soft dispute mechanism for TSD obligations, following years of pressure by various stakeholders. This non-paper remained apologetic about hard sanctions but promised a review in 2023. This article aims to study to what extent the EU delivered upon its promise to use the soft dispute mechanism more assertively during its first TSD proceedings. It finds that the EU was not prepared to act assertively in relation to certain issues (collective bargaining and the right to strike) and certain workers (in the public and export sectors) during the proceedings before the ad hoc Panel of Experts, which ended in 2021. It argues, in particular, that the EU missed a major opportunity to use its bargaining leverage vis-à-vis Korean consumer conglomerates.


Introduction
After the failure to make significant progress towards a multilateral trade agreement in the World Trade Organization's (WTO) Doha Round in 2001, the European Union

This is an Open Access article distributed under the terms of the Creative Commons Attribution License (https://creativecommons.org/licenses/by/4.0/), which permits unrestricted reuse, distribution, and reproduction in any medium, provided the original work is properly cited.
Panel of Experts less 'assertive' in two ways. First, the EU considered that the issues relating to collective bargaining and the right to strike had been 'satisfactorily addressed' during the government consultations. This article argues, however, that there is too little evidence pointing in this direction. It relies, amongst others, upon recent statements made by Korea, civil society in Korea, the EU's DAG, international bodies (including the ILO's Committee on Freedom of Association [ILO CFA]) and the academic literature. Second, the EU went to considerable lengths to avoid referring to the public and export sectors and, in so doing, missed a major opportunity to use its bargaining leverage vis-à-vis some of the biggest consumer conglomerates in the world. Finally, section 5.B discusses the Panel's report, a milestone decision that will likely serve as a precedent for future ad hoc panels, and recent developments.

Trade and Labour Obligations
This section first summarizes the debate of a social clause under international law. It then explains how Chapter 13 of the EU-Korea FTA links trade to labour issues and describes the labour obligations and dispute mechanism in Chapter 13.

A International Law
Since the adoption of the North American FTA and its labour side agreement in the beginning of the 1990s, there has been a divisive debate on regulatory links between trade concessions and compliance with labour standards. 15 While social clauses alleviate fears that developing and emerging states compete with their peers in a 'race to the bottom' by keeping the costs associated with domestic laws as low as possible, they have a patronizing or neo-colonial air. In addition, social clauses can at least be partly labelled as a form of disguised protectionism. 16 States have an interest in taking away the comparative advantage of other states with weaker labour protection that can produce goods and deliver services at a lower opportunity cost. For these reasons, many developing and emerging states opposed a multilateral social clause in the late 1990s. 17 As a result, the declaration made at the WTO Singapore Ministerial Conference in 1996 referred labour standards to the ILO. 18 This declaration also proposed that labour standards may not be used for protectionist purposes and that the comparative advantage of countries may in no way be questioned. 19 The Singapore consensus clearly influenced the formulation of Chapter 13 of the EU-Korea FTA. Article 13.2.2 of this agreement stated that TSD standards should not be used for protectionist trade purposes and that the comparative advantage should in no way be questioned.
In 1998, the ILO adopted a declaration that set out certain fundamental labour standards that apply to all ILO member states, including Korea and the EU members states, 'even if they have not ratified the Conventions in question'. 20 In particular, ILO member states are obliged to respect, promote and realize in good faith the elimination of child and forced labour; the elimination of discrimination in respect of employment and occupation and the freedom of association; and the effective recognition of the right to collective bargaining. These obligations are laid down in eight fundamental labour conventions, and their fundamental status was reaffirmed in a 2008 follow-up declaration. 21 While the EU member states have ratified all eight core labour conventions, Korea had not ratified four of them at the time of the ratification of the EU-Korea FTA. These concerned ILO Conventions 29 and 105 on the Abolition of Forced Labour, ILO Convention 87 on the Freedom of Association and Protection of the Right to Organize and ILO Convention 98 on the Right to Organize and Collective Bargaining. 22 In 1990, Korea had also made a reservation to Article 22 of the International Covenant on Civil and Political Rights on the freedom of association, declaring that this article shall be applied in such a way that it is to conform to the provisions of the local laws. 23 When Korea joined the OECD, the Kim Young-sam administration committed to reforming regulations on industrial relations in line with international standards, including the core labour conventions. 24 In 1997, however, the problematic Trade Union and Labour Relations Adjustment Act (TULRAA) was adopted by the ruling New Korea Party. 25 The OECD reacted by creating a special monitoring process. 26 This process stopped in 2007, but various issues remain. 27 Similarly, the ILO CFA has been trying to nudge Korea to respect trade union rights for a quarter of a century. To date, it has considered 13 cases and issued various recommendations. 28 This will be illustrated in section 5.A, demonstrating that various issues addressed in the committee's first opinion from 1995 are still ongoing today.

B EU-Korea FTA
While the EU has systematically included 'human rights clauses' in its trade agreements since 1995, 29 it started focusing on fundamental labour rights after the adoption of the ILO's 1998 Declaration on Fundamental Rights. 30 This development has been dubbed the 'ILO-ization' of the EU's trade policy. 31 The references to labour rights in EU trade agreements were initially less explicit than those in the trade agreements of Canada and the USA. 32 But the EU's position has often been the focus of debate, not least because the EU sees itself as a 'leading example' and seeks to promote 'its' values in the wider world, especially since the adoption of the Treaty of Lisbon. 33 Famously, Ian Manners has argued that this was a way for the EU to legitimize and present itself as more than 'merely' a form of economic government in response to the increasing resistance by its citizens to economic liberalization after the Cold War. 34 Yet the EU's normative interests are in reality more rational than it likes to portray them to be. 35 Normative interests are often only a priority when they coincide with other strategic interests, most notably economic interests that are inspired by a neo-liberal agenda. Closely related is the observation that the EU's approach has triggered criticism of protectionism, paternalism and neo-colonialism by trade partners and experts. Such criticism often makes sense because it appears as if the social clause is introduced ' Under Chapter 13 of the FTA, Korea and the EU maintain the right to determine their levels of labour (and environmental) protection. 37 Furthermore, they commit to cooperating towards increasing levels of protection and ensuring that laws and policies provide for and encourage 'high levels' of protection, consistent with internationally recognized labour (and environmental) standards (Article 13.3). Korea and the EU recognize the importance of taking account of scientific and technical information (Article 13.8). They also agree to develop, introduce and implement measures aimed at protecting the labour (and environmental) conditions that affect trade between them transparently, with due notice and public consultation (Article 13.9).
Apart from these soft provisions, there are two categories of specific labour obligations in Chapter 13. First, there are obligations with a national focus. 38 The parties agree to 'uphold levels of protection in the application and enforcement of laws, regulations or standards' in Article 13.7. The first paragraph of this article stipulates that the parties shall not fail to effectively enforce their labour laws through a sustained or recurring course of action or inaction in a manner affecting trade and investment between the parties. 39 The second paragraph of this article sets out that the parties shall not weaken or reduce the achieved protection in their laws to encourage trade and investment by waiving, offering to waive or otherwise derogating from their laws, regulations and standards in a manner affecting trade and investment between the parties. 40 This provision prevents the parties from competing in a 'race to the bottom' and creates conditions of fair competition between companies. Second, Article 13.4.3 contains three obligations, in accordance with the obligations deriving from membership in the ILO, the ILO's Declaration on Fundamental Rights and its 2008 Declaration on Social Justice. 41 To begin, the parties commit to respecting, promoting and realizing the ILO's fundamental labour rights in their laws and practices (Article 13.4.3, first sentence). In addition, the parties reaffirm the commitment to effectively implement the ILO conventions that they have ratified (Article 13.4.3, second sentence). Finally, the parties agree to make continued and sustained efforts towards ratifying the fundamental ILO conventions as well as the other conventions that are classified as being 'up-to-date' by the ILO (Article 13.4.3, last sentence).
No other FTA that has entered into force in Korea to date contains such far-reaching labour obligations. 42 To begin, various more recent FTAs contain labour clauses with a national focus. Yet they are generally limited to the ILO's fundamental labour 37 EU-Korea FTA, supra note 10, Art. 13.3. 38 These obligations also exist in relation to environmental domestic laws. 39 EU-Korea FTA, supra note 10, Art. 13.7.1. 40 Ibid., Art 50 Under the Korea-USA FTA, there is a dispute settlement procedure that is similar to those used for other parts of the agreement. 51 The soft dispute settlement system under Chapter 13 of the EU-Korea FTA consists of two steps. Article 13.14 sets out that the parties are first required to engage in government consultations. The parties have to make every attempt to arrive at a mutually satisfactory resolution, but each party can request the establishment of a Panel of Experts for matters that have 'not been satisfactorily addressed' after 90 days (Article 13.15). The Committee on TSD, which oversees the implementation of Chapter 13, monitors whether the parties make their best efforts to accommodate the Panel's recommendations. The European Commission has long defended this soft approach to sustainability disputes. The origins of this approach lie in the multilateral trade talks 43  described in section 2.A. of this article. 52 The EU Council committed to 'firm opposition to any sanctions-based approaches' to labour and trade-related disputes in the WTO in 1999. 53 But, under pressure from this body, the European Parliament, civil society and several EU member states, the Commission reconsidered a sanctions-based model to enhance the implementation of TSD chapters in a 2017 non-paper. 54 The Commission ultimately argued against such a hard approach in another non-paper one year later. 55 This non-paper writes that it is uncertain whether sanctions can be translated into economic compensation and whether such sanctions would result in effective, sustainable and lasting improvement on the ground. 56 It further alleges that negotiating partners would require the EU to reduce the scope of TSD obligations if they were to be made enforceable. 57 The non-paper concludes that it was impossible to move towards a hard approach at that time. This position will be reconsidered at the latest by 2023.

Informal Consultations
The DAGs on both sides are tasked with advising on the implementation of Chapter 13 of the EU-Korea FTA. 58 The DAGs can undertake action at the request of the Committee on TSD, at the request of the side that it advises or on its own initiative. They are composed, in theory, of representatives of labour, environmental and business organizations as well as other relevant stakeholders. The composition of the DAGs has raised questions on both sides. Environmental organizations have been under-represented in the EU's DAG, and there were concerns regarding the independence of civil society representatives in Korea's DAG. 59 The vast majority of the members of Korea's DAG were senior academics, and the Korean Confederation of Trade Unions (KCTU) was only included after significant pressure from the European side and beyond. 60  of both DAGs meet at a Civil Society Forum. This forum is normally organized once a year, but no forum took place in 2019 and 2020 because the labour issues that will be discussed below created tensions between the EU's DAG and Korea's DAG. 61 The EU's DAG wrote two letters to start formal TSD consultations to the two respective commissioners for trade, Karel De Gucht and Cecilia Malmström. Despite some reluctance from the business representatives in the EU's DAG to write the first letter in 2014, 62 the EU's DAG expressed the idea that Korea was in serious violation of its commitments under Article 13.4.3 of the EU-Korea FTA. 63 The EU's DAG requested to start government consultations regarding precarious working conditions as well as the core labour rights -in particular, the right to freedom of association. The EU's DAG attached its 2013 opinion in which it had extensively referred to these issues to its letter. 64 This opinion relied upon material from the ILO CFA, the OECD and the IMF. Furthermore, the EU's DAG flagged alleged attacks on unions for teachers and educators, government employees, including railway workers, and the KCTU under then President Park Geun-Hye (2013-2017). It also noted Korea's failure to ratify the four outstanding fundamental labour conventions.
In the second letter in 2016, the EU's DAG referred not only to alleged Article 13.4.3 violations but also to alleged Article 13.3, 13.9 and 13.7.2 violations of the EU-Korea FTA. 65  The trade commissioners, however, preferred informal talks through a multitude of communication channels. 68 A member of the EU's DAG observed that the Korean officials had 'not understood the gravity of the situation'. 69 They were reportedly not prepared to answer questions from the Commission. 70 But Malmström alleged that a joint project on gender discrimination had been 'meaningful' in offering greater understanding, which was said to be 'far from obvious, given Korea's initial reactions to such events'. 71 She saw this project as the basis on which to engage more closely with Korea on the rights to association and the effective recognition of collective bargaining. While a committee of the European Parliament suggested that the DAGs could prepare a similar project on the implementation of all core labour conventions, 72 the chairs of both DAGs noted that the project on gender discrimination had not been up to the ILO's standards. 73 The Commission's perceived wait-and-see approach has been heavily criticized by civil society organizations. 74 It fits in with the above-described tendency to subjugate normative interests to economic interests. In this case, the Commission allegedly wanted to prioritize the conclusion of an additional investment agreement over taking a strong stance on labour rights. 75 Ultimately, in 2017, the European Parliament also asked the Commission to start formal government consultations and, if necessary, request the creation of a Panel of Experts. 76 The Parliament referred, amongst other things, to 'troubling examples of imprisonment of trade union leaders and interference in negotiations' and to Korea's failure to ratify the four outstanding fundamental labour conventions. The Parliament supported the deepening of trade and investment relations with Korea but noted that these TSD issues would need to be resolved first. In 2018, pressure on the Commission became untenable. At that time, the Commission had found itself required to adopt the non-papers discussed in section 2.B of this article. 68

A Ratification of Fundamental Labour Conventions
To begin with, the EU alleged that Korea's efforts to ratify the four core labour conventions had been inadequate. The EU considered that Korea failed to act with the determination required to comply with Article 13.4.3 of the EU-Korea FTA. While the Korean president has the constitutional power to conclude and ratify treaties, the legislature has the right to consent to treaties concerning important international organizations and some other constitutionally important treaties. 79 The Korean government announced its plan to submit the bills for the ratification of ILO Conventions 29, 87 and 98 to the National Assembly in May 2019, after the government consultations. 80  not have the required three-fifths majority in the National Assembly to push through legislation unilaterally at this time. The opposition parties objected to the formal discussions in the National Assembly. 83 Korea's efforts in relation to the ratification of ILO Convention 105 on the Abolition of Forced Labour were, in comparison, much slower. 84 Korea does not intend to leave out this convention, but it plans to ratify the three other fundamental labour conventions first. 85 It is useful to elaborate upon three important motivations that Korea has for delaying the ratification of ILO Convention 105. 86 First, subsequent Korean governments have indicated that the abolition of forced labour is problematic because the country has a mandatory military 'service' for Korean men under the age of 28. 87 Korea finds conscription to be non-negotiable due to the ongoing war with its only neighbour, the authoritarian Democratic People's Republic of Korea. While Article 2(2) of ILO Convention 29 does explicitly state that military service is not 'forced or compulsory labour', ILO Convention 105 does not contain such a provision. 88 The second issue also relates to the war on the Korean peninsula. Article 7 of the 1948 National Security Act stipulates a prison sentence involving prison labour for expressing political opinions favourable towards the Democratic People's Republic of Korea. While prison labour would also be prohibited under the older ILO Convention 29, 89 Article 1(a) of ILO Convention 105 explicitly stipulates forced or compulsory labour as a means of political coercion, education or as a punishment for holding or expressing political views or views ideologically opposed to the established political, social or economic system. Korea ponders whether 'it is necessary for us to repeal the provision of imprisonment with labour or to convert the imprisonments with labour into imprisonment without labour all at once'. 90 This is considered to be a sensitive issue that requires extensive public debate.
The third issue has not been explicitly mentioned by Korea but is likely to also be important. The 2003 Act on Foreign Workers' Employment contains a visa scheme that benefits sectors suffering from labour shortages while protecting the Korean labour market. 91 Under this scheme, migrants can fill jobs involving manual tasks and work for up to three years at a small-and medium-sized factory with fewer than 300 employees. To do this, they have to sign a labour contract with a Korean employer before entering the country and often pay a recruitment fee. 92 Once in Korea, some migrants find that the jobs are different from those they were promised; they may be more dangerous or less well paid than they had expected. The scheme provides, however, few rights to negotiate a change of job and makes migrants vulnerable to all forms of exploitation, including forced labour. 93 The ILO has often suggested that migrant workers are coerced through debt and other forms of bondage caused by high recruitment fees. 94 While ILO Convention 29 would also prohibit such migrant labour, 95 Article 1(b) of ILO Convention 105 explicitly prohibits forced or compulsory labour as a method of mobilizing and using labour for the purposes of economic development.

B Respecting, Promoting and Realizing Fundamental Labour Rights
The EU, furthermore, complained in the government consultations that Korea does not respect, promote and realize in its laws and practices the fundamental labour rights according to the obligations resulting from membership in the ILO (Article 13.4.3 of EU-Korea FTA). The EU questioned Korean laws relating to both categories of core labour rights that are articulated in ILO Conventions 82 and 98: the right to association and the effective recognition of collective bargaining. 96 It also paid some attention to the right to strike, an intrinsic corollary of the fundamental right of freedom of association. 97 All these issues had previously been raised by the EU's DAG in its 2013 opinion, its letters and the annexes to these letters. 98 The EU's complaints regarding the right to association were the most extensive. There were three specific complaints. First, the EU questioned whether workers have the right, without distinction, to establish or to join organizations of their choosing. It was particularly worried that Article 2(1) of the TULRAA defines a 'worker' as a person who lives on wages, a salary or another equivalent form of income earned in pursuit of 91  any job. This definition excludes dismissed and unemployed persons. It also excludes, in the words of the EU, 'self-employed persons (including those working mainly for one employer)'. 99 With this wording, the EU seems to refer to the widespread system of 'dispatch work' in Korea, which was introduced after the 1997 Asian financial crisis. 100 The EU's DAG explained in its 2013 opinion such triangular employment relationships, where corporations transfer precarious workers into unspecified employment relationships. 101 Companies do not directly hire workers but rely upon full-time workers that are employed by temporary employment agencies. Doing so allows them to evade the exercise of trade union rights because Article 2(4)(d) of the TULRAA specifies that an organization cannot be considered to be a trade union in cases where 'non-workers' have joined the organization. Second, the EU was concerned about the right of workers to establish organizations without previous authorization. Article 12(1-3), in conjunction with Articles 2(4) and 10 of the TULRAA, contains a certification procedure for the establishment of trade unions. 102 The EU alleged that this procedure was discretionary. Third, the EU said that Article 23(1) of the TULRAA impedes the right of organizations to elect their representatives in full freedom. This article states that trade union officials may only be elected from among the members of the trade union.
The EU also paid attention to some issues relating to the effective recognition of collective bargaining and the right to strike in its complaint. Regarding the effective recognition of collective bargaining, the EU claimed that Article 31(2-3) of the TULRAA violated this right. The EU alleged that the labour administration uses this article to request changes to collective agreements. Regarding the right to strike, the EU questioned Article 314 of the 1953 Penal Code on 'obstruction of business', which states that obstruction of business is 'interfering with the business of another by injuring their credit through lies or fraudulent means, threat of force, or damaging record and record-keeping equipment'. The Korean police and public prosecutor's office would use this provision to stop certain peaceful strike actions. 103

Panel of Experts
In July 2019, the EU called for a Panel of Experts to be created while remaining open to finding a mutually agreed solution to the matter. 104 This section of the article first argues that the EU tried to make the proceedings in the Panel of Experts less assertive than in the government consultations. On the one hand, the language was softened to not refer to certain workers. On the other hand, certain issues were wrongly claimed to be resolved in the government consultations. After explaining that the EU underestimated its bargaining power vis-à-vis Korean export sectors, the section shows that the Panel of Experts was largely unbothered by the EU's ploys. For civil society, this was no doubt a relief.

A EU Complaints
The EU set out its grievances in its written submissions of 20 January 2020. 105 They were written by two staff members of the European Commission who acted as EU agents. Two issues were considered to be outstanding. First, the EU repeated its request for the ratification of the core labour conventions. While some progress had been made, it was still not clear at the time, according to the EU, whether the four outstanding core labour conventions would be ratified (under Article 13.4.3 EU-Korea FTA). Second, the EU complained that Articles 2(1), 2(4)(d) and 23(1) and Article 12(1-3), in connection with Articles 2(4) and 10 of the TULRAA, violated Korea's commitment to respecting, promoting and realizing in its laws and practices the fundamental labour rights in accordance with the obligations deriving from its membership in the ILO. According to the EU's written submissions, this complaint exclusively related to the right to association, as expressed in Articles 2 and 3 of ILO Convention 82 (under Article 13.4.3 of the EU-Korea FTA), and no reference was made to violations of ILO Convention 98.
The EU did not refer to the effective recognition of collective bargaining and the right to strike in its written submissions. 106 After the government consultations, the EU explicitly claimed that sufficient progress was made regarding these rights. 107 It elaborated only on its reason for maintaining that Article 314 of the Penal Code had been sufficiently resolved in its lines to take. 108 The Commission said that this article had not been amended but that the Korean Supreme Court had 'gradually adopted a narrower interpretation of this provision (judgments of 2011, 2015 and 2017)'. 109 Following the 2017 judgment, the Korean Public Prosecutor's Office withdrew charges against workers that had participated in strikes, based on Article 314. The Commission, therefore, held that it trusted that these judgments would lead in future to the non-applicability of this provision to peaceful strikes. 105  This explanation is not sufficient. In 2018, the Korean government also referred to the three Supreme Court judgments regarding the application of Article 314 of the Penal Code in proceedings in the ILO CFA. 110 While the ILO CFA welcomed this application, it noted that the courts still favoured a restrictive approach to the application of obstruction of business to strike actions. 111 It encouraged the government to follow up on its stated intention to review Article 314 of the Penal Code and referred back to its recommendations in Case no. 1865 in 1995. 112 More generally, while political and legal change may arise from litigation, 113 the causal relationship can also go in the other direction. It is common practice in Korea to create new laws after court proceedings to legitimize labour rights violations. For example, in 2012, the police authority had rejected the union's plan to hold a rally union in front of the Samsung Electronics headquarters because another union had already registered to hold a rally. 114 The Seoul Administrative Court cancelled this decision. 115 It found that this other union was an enterprise-level union that had applied to hold rallies more than 130 times that year but had never actually held any.
This judgment was a victory for trade unions rights, but, in 2016, an amendment was introduced in the Assembly and the 2007 Demonstration Act to legitimize such practices by enterprise-level unions to incapacitate independent and democratic unions. 116 Moreover, the Commission should have been aware of persistent issues regarding the effective recognition of collective bargaining and the right to strike in Korea because the EU's DAG raised them in its 2013 opinion. For example, the EU's DAG has noted that the overly broad interpretation of 'essential services' in the TULRAA allows the replacement of workers in various 'public sectors', which are as diverse as radio and railway. 117 Similarly, the EU's DAG has noted that Article 29(2) of the TULRAA contains a problematic procedure for determining the bargaining agent. 118 It has stated that collective bargaining must be conducted through a single bargaining channel unless the employer agrees to hold multiple negotiations. This has meant that the biggest (coalition of) union(s) has the sole right to bargain if multiple unions fail to decide upon a common bargaining agent. Corporations can easily abuse this system by establishing enterprise-level unions.
In addition to limiting its written submissions to the right to association, the EU avoided referring to the public sector and the export sector, two sectors that had been flagged by the EU's DAG as problematic. Two pieces of evidence illustrate this issue. First, the wording in the request for the establishment of a Panel of Experts was changed. It was noted in section 4.B of this article that the request for government consultations referred to illegally dispatched workers by expressing concerns about 'self-employed persons (including those working mainly for one employer)'. The request for the creation of a Panel of Experts, however, refers to 'self-employed persons such as heavy goods vehicle drivers'. Second, the written submissions rely heavily upon the ILO Cases nos. 1865 (1995), 2602 (2007) and 2829 (2012), which concerned the Korean public sector and conglomerates in the automobile sector (Hyundai) and the electronics sector (Hynix). But they refer nowhere to these sectors explicitly. The alleged problems with the registration procedure, for example, were exclusively illustrated by referring to teachers and drivers. Similarly, the problems with Article 2 of the TULRAA were illustrated by referring to teachers, drivers, broadcasting and animator creators, caregivers, door-to-door delivery persons, motor delivery service persons, telemarketers and construction equipment operations. While some of these workers are indirectly working for the export sector, the EU never refers to workers who are working in factories that produce mainly for export markets.
The public sector and the export sector are considerably more controversial than the categories of workers that the Commission has singled out. Trade union rights for public officials sit in a special category in international law. While Article 2 of ILO Convention 87 does not allow exceptions for 'the administration of the state', Article 8 of the International Covenant on Economic, Social and Cultural Rights (which Korea has ratified) allows such exceptions for public officials. 119 The export sector is equally sensitive. James Harrison and his co-authors aptly note that one of the reasons why labour provisions have not been well enforced in FTAs by the Commission is that 'trade officials may perceive such provisions as impairing the competitiveness of export industries'. 120 This is certainly the case in Korea. The literature on the subject describes that Korean politicians have long served the interests of large conglomerates at the expense of workers in these sectors. 121 Conglomerates that have been the subject of proceedings in the ILO CFA such as Samsung, Hyundai and Hynix have made Korea the economic powerhouse it is today. 122 Together, these three groups accounted for more than 36 per cent of Korea's nominal gross domestic product in 2020. 123 The Commission missed an opportunity by avoiding any references to the Korean export sectors. The Commission underestimated its influence over these sectors. Korean conglomerates sell some of the highest-profile brands in the world. Notably, the Samsung group ranked 17th in Reptrak's 2021 Global Reputation index, which measures 'how people feel, think, and act towards companies globally'. 124 Furthermore, Samsung Electronics and the Hyundai Motor Company were two of the Korean companies in Fortune's 2021 ranking of the World's 333 Most Admired Companies. 125 While many corporations are relatively immune to reputational pressures, these high-profile conglomerates are relatively vulnerable to such pressures because they deliver directly to their end consumers. 126 They will likely voluntarily improve their fundamental labour rights track record when there is a greater risk that harmful behaviour will be exposed in order to preserve (or restore) brand reputations in the EU. 127 Questioning labour rights issues in the Korean export sector during the proceedings before the Panel of Experts could certainly have increased reputational risks. Deflecting negative publicity raised in dispute proceedings would also have been difficult in the EU. In Korea, in comparison, this has been relatively easy because Korean conglomerates have considerable influence over domestic media and channels of communication. They have the power to withhold advertising revenue from the press and have the law on their side. 128 Chapter 33 of the Penal Code on 'crimes against reputation' enables conglomerates to suppress critics even when they speak the truth.
Several factors can explain why the Commission complained only about certain issues and certain workers to the Panel of Experts. After years of failed negotiations on TSD issues with Korea, the Commission was well aware of the difficulties in its attempts to influence the Korean domestic take on labour rights. 129 Therefore, the EU could have chosen to focus on less controversial sectors and fewer issues in order to have had at least some tangible effect. The Commission could also have considered that Korea might not be particularly eager to change its attitude since the EU-Korea FTA has not (yet) provided many benefits to Korea. While EU exports to Korea have increased, Korea's exports to the EU have decreased. 130 Although this is likely to be a temporary effect of a protected market that is opening up, this had not been forecasted during the treaty negotiations.
The Commission's non-confrontational stance further served its own agenda. The EU has relatively limited bargaining power vis-à-vis Korea due to Korea's economic power and relative importance to the EU as a trading partner. 131 By a priori limiting the number of (controversial) issues submitted to the Panel of Experts, the Commission made it easier to 'solve' these issues. This, in turn, made it easier for the Commission to start negotiations on an investment chapter. Recall that the European Parliament expected progress regarding TSD before the start of such negotiations. But the stakes were higher than this single dispute. An 'easier to solve' dispute makes it easier for the Commission to demonstrate that its soft approach towards sustainable development in trade relations 'works'. The Commission will 'need' such evidence during its 2023 review of the sustainable development dispute mechanisms in FTAs.

B The Panel of Experts
During the hearing of the Panel of Experts in October 2020, Korea predictably argued that the EU's request fell outside the Panel's jurisdiction because the issues raised did not refer to trade-related aspects. Korea argued that Article 13.2.1 of the EU-Korea FTA limits Chapter 13 to trade-related aspects. This article reads as follows: 'Except as otherwise provided, … this Chapter applies to measures adopted or maintained by the Parties affecting trade-related aspects of labour and environmental issues.' Korea said that it did not believe that 'alleged difficulties experienced by, for example, chauffeur service drivers will affect trade between Korea and the European Union'. 132 The Panel disagreed and noted that ' Article 13.4.3 was clearly an exception that Article 13.2.1 allows to exist'. 133 According to the Panel, Article 13.4.3 was drafted in such a way that it excluded the possibility that domestic commitments to achieve or work towards key international labour principles and rights exist only in relation to trade-related aspects of labour. 134 Requiring 'trade-relatedness' conflicts with the language of 'fundamental rights' in the context of the ILO Constitution and the 1998 ILO Declaration on Fundamental Rights. 135 The Panel also had to return to the Singapore consensus because Korea argued that Article 13.2.2 of the EU-Korea FTA prohibits protectionism and calls into question its comparative advantage. The Panel first referred to empirical research conducted in 1996 by the OECD that demonstrated that the protection of core labour rights does not 'influence the competitive positioning of these countries in the context of [trade] liberalization'. 136 On the contrary, such protection might even 'strengthen the economic performance of all countries'. 137 It then highlighted more recent research conducted by the ILO. 138 Ultimately, the Panel made a point of saying that measures based on Article 13.4.3 'are not limited to trade-related aspects of labour' but that this finding does not mean that it 'has concluded that the EU's Panel Request refers to matters which have no connection to trade'. 139 The Panel determined that 'decent work' is at the heart of the aspirations for TSD formulated by Korea and the EU. The 'floor' of labour rights was determined to be an integral component of the system that they commit to maintaining and developing. 140 National measures implementing such rights are 'inherently related to trade' under the EU-Korea FTA. 141 Remarkably, the Panel of Experts did not mind that the EU had not referred to the right to the effective recognition of collective bargaining in its written submissions. While the EU's claim regarding the registration procedure of trade unions was rejected, the Panel found that the other disputed TULRAA provisions violated Korea's commitment to respecting, promoting and realizing in its laws and practices the fundamental labour rights in accordance with the obligations deriving from membership in the ILO. 142 The Panel determined that Korea violated this obligation because these TULRAA provisions violate both the freedom of association and the effective recognition of collective bargaining. 143 The Panel referred to these two fundamental labour rights as the 'principles of freedom of association' 'for ease of reference'. 144 Furthermore, in its assessment of Article 2(1) of the TULRAA, the Panel elaborated upon the effective recognition of collective bargaining. It said that it considered issues relating to collective bargaining 'on the ground' as submitted in the amicus curiae brief of the KCTU. 145 The Panel also considered Korea's interpretation of collective bargaining in its assessment of Article 23(1) of the TULRAA. Ignoring the rich literature on this topic, 146 Korea said that 'collective bargaining between labour and management in Korea typically occurs at enterprise level' because of the unique partnership and daily contacts between union members and the management of the enterprise. 147 The Panel, however, noted that the ILO CFA explicitly states that a requirement that union officials work in the enterprise of the enterprise union is contrary to freedom of association. 148 Workers' organizations are entitled to elect their representatives in full freedom.
The Panel rejected the EU's claim that Korea's efforts to ratify ILO Conventions 29, 87, 98 and 105 on core labour had been insufficient. The Panel determined that the last sentence of Article 13.4.3 affords leeway to the parties and does not require that ratification efforts should take place 'without interruption'. 149 The efforts that had taken place, which are described in section 4.A of this article, were considered to be 'tangible'. 150 In April 2021, three months after the Panel of Experts issued its recommendations, Korea also ratified ILO Conventions 28, 87 and 98. The Commission's director-general for trade Sabine Weyand was quick to claim that this was a case of 'enforcement of our #TSD chapter EU-Korea in practice'. 151 This public statement was less modest than a statement that had previously been made by one of the members of the EU's DAG. This member noted that 'the fact that [the] Korean government decided to look into the ratification of the ILO conventions is partly the result of our activities, but of course if many people knock on the door sooner or later it will open'. 152 Korea, from its side, claimed that the previous progress that was made in relation to its ratification efforts had nothing to do with the government consultations. 153 A likely explanation for this reaction is that Korea perceived the dispute proceedings as insulting and interfering with its internal affairs. 154 I have determined in older research -a case study that I carried out in Korea in 2018 -that any form of collaboration -international, regional or bilateral -is regularly perceived as interference in Korea due to the trauma that has been inflicted by Japanese colonization, the Korean war and the continued presence of the USA in Korea. 155 In any case, it appears that major steps forward have been made since the government consultations started. Various other positive developments can be reported. First, the Commission announced in April 2021 that the EU and Korea had agreed to review jointly Korea's preparatory work to ratify ILO Convention 105. 156 Korea indicated that it would undertake a research project to identify what needed to be changed in its legal framework to avoid incompliance with this convention in the most recent meeting of the Committee on TSD. 157 Second, the EU and Korea agreed to jointly review the application of new TULRAA provisions after they entered into force in July 2021, in an ad hoc interim meeting of this committee. 158 Third, the EU's DAG and Korea's DAG met for the first time since 2018 to hold a Civil Society Forum. 159

Conclusion
This article has analysed how the EU approached the first government consultations and Panel of Experts proceedings for 'trade and sustainable development' issues under a FTA. The EU's requests came after the EU promised a more assertive approach towards the enforcement of labour and environmental issues in 2018. This article has compared the EU's labour complaints in the government consultations and in the Panel of Experts. It has demonstrated that the EU was not prepared to be assertive about certain issues (the effective recognition of collective bargaining and the right to strike) and about certain workers (in the public sector and the export industries) during the proceedings in the Panel of Experts, after years of difficult negotiations on trade and sustainable development issues with a country that has not yet captured the forecasted economic benefits of free trade.
With this approach, the Commission made it easier to deliver some of the results that the stakeholders had been requesting for a long time while, at the same time, paving the way for the negotiation of an investment agreement. The Panel of Experts was unimpressed (and considered the effective recognition of collective bargaining at length). This resulted in a balanced opinion, which has led to some results. Most importantly, Korea ratified ILO Conventions 29, 87 and 98 in April 2021. The Commission thus seems to have obtained what it needs for the 2023 review of the 'trade and sustainable development' dispute mechanisms in FTAs: evidence that its 'soft approach' works. After the publication of the Panel of Experts report, Valdis Dombrovskis, executive vice-president and commissioner for trade, produced a press release noting that the Panel's ruling shows 'the effectiveness of our cooperation-based approach to trade and sustainable development'. 160 Nevertheless, the Commission missed a major opportunity for sustainable development. It underestimated the EU's bargaining power vis-à-vis Korean export sectors. While many corporations are relatively immune to reputational pressures because they do not directly deliver to end consumers, Korea is home to some of the largest consumer conglomerates in the world, and they can effectively mitigate reputation risks in Korea due to their outsized power and influence. They would have been under considerable pressure to improve their fundamental labour rights track record if there would have been a greater reputational risk in the EU.