A major new deal that will liberalize trade between the European Union and Canada has come into force on a provisional basis.

The Comprehensive Economic and Trade Agreement (CETA) took effect on September 21st following its approval by EU member states through the Council of Europe and the European Parliament, and is expected to deliver a wide range of benefits for companies in the EU and Canada.

With the provisional implementation of the deal, tariffs will be abolished on 98 per cent of products traded between the EU and Canada, while giving companies in both territories better access to public procurement contracts. Smaller companies who can least afford the cost of the red tape involved in exporting are most likely to benefit, allowing them to save time and money by avoiding duplicating product testing requirements, lengthy customs procedures and costly legal fees.

Member states' authorities dealing with export promotion will also be working to help businesses to start exporting overseas, boost existing trade and attract investment, with certain sectors set to particularly benefit, such as European farmers and food producers.

The European Commission estimates that EU businesses will save €590 million a year in the amount they pay in tariffs on goods exported to Canada, while consumers will also benefit from access to a wider range of products.

Cecilia Malmstrom, the EU commissioner for trade, said: "CETA is a modern and progressive agreement, underlining our commitment to free and fair trade based on values.

"It helps us shape globalization and the rules that govern global commerce. Moreover, CETA underlines our strong commitment to sustainable development and protects the ability of our governments to regulate in the public interest."

CETA will be fully implemented once all EU member states ratify the deal according to their respective constitutional requirements. A new and improved investment court system will replace the current investor-state dispute settlement mechanism at this time.