In June 2018, the European Union represented by Commissioner for Trade Cecilia Malmström and Australia represented by Prime Minister Malcolm Turnbull and Trade Minister of Australia Steven Ciobo officially launched negotiations for a comprehensive and ambitious trade agreement. So far, the EU and Australia have been conducting their trade and economic relations under the 2008 EU-Australia Partnership Framework. The aim of the negotiations is to further remove barriers to trade in goods and services, and to further consolidate the EU's engagement in the Asia-Pacific region. It is worth mentioning that the negotiations follow the conclusion of the EPA with Japan in 2017 and the entry into force of the CETA with Canada in 2017.

Australia is one of the world's fastest-growing developed economies and the EU is Australia's second-biggest trade partner after China. Bilateral trade in goods between the EU and Australia has risen steadily in recent years, reaching almost €48 billion in 2017, especially in transport equipment, machinery and appliances, chemicals and food. Bilateral trade in services is around €28 billion. According to the Commission’s model, trade in goods between Australia and the EU could increase by 37% in case of an ambitious trade deal. The services trade, meanwhile, could increase by 8%.

Australia has concluded numerous trade agreements with other partners and number of trade agreements are being negotiated, particularly, the Comprehensive and Progressive Trans-Pacific Partnership with 10 countries in the Pacific region. Since the EU does not yet have a preferential bilateral trade arrangement with Australia, EU businesses have currently less favourable conditions to access the Australian market. Thus, future comprehensive trade agreement with Australia is expected to put European companies exporting to or doing business in Australia on an equal footing with those from countries that have signed up to trade agreements with Australia.

Commissioner for Trade Cecilia Malmström said: "I look forward to adding Australia to our ever-expanding circle of like-minded trade partners. In challenging times, it is heartening to see that Australia shares our commitment to a positive trade agenda, and to the idea that good trade agreements are a win for both sides. The result of our negotiations will be an agreement that offers clear benefits for both the EU and Australia. It will boost economic opportunity for businesses, both big and small, and create jobs."