EU-US Trade Negotiations: Europe faces weapons of legal destruction in USA trade talks - by Kevin Albertson

Efforts to build a more effective trading regime between Europe and the USA can reasonably be called positive, both for growth and the ease of doing business. Currently, however, negotiations include proposals which threaten to distort the way governments regulate companies and which might cost the taxpayer dearly.

The sticking point for many is the inclusion in the TTIP negotiations of the contentious Investor to State Dispute Settlement (ISDS) provision.

ISDS gives international investors the right to bring a case for damages against the local government if they (the investors) feel government policy has harmed their interests. A supposed independent international tribunal hears such claims. In other words, under ISDS, multinational corporations have the right effectively to sue a sovereign state, demanding the state (that is, the taxpayer) compensates them for enacting domestic policy if it reduces profitability below that which was expected.

There are clear potential conflicts of interest. The responsibility of the corporate sector is to maximise profits, while the responsibility of government is to promote competition which might reduce corporate profits; also governments must promote the public good – which is likely in some instances to affect corporate profits, for example in controlling pollution or enforcing health and safety legislation. Establishing a means by which disagreements might be resolved is, therefore, of some importance. However, to this end, the ISDS is not an efficient means – it is apparently skewed.

ISDS arguably weakens the rule of law, forces the public to subsidise the risk of multi-national investment abroad, and effectively encourages outsourcing.

Read more: Europe faces weapons of legal destruction in USA trade talks

The Canada-EU trade deal: Signed, not sealed

In October last year, Stephen Harper, Canada’s prime minister, flew to Brussels to sign a trade-and-investment deal in principle between Canada and the EU. On September 26th, the two sides announced the close of negotiations. But despite the back-slapping there may still be work to be done. Sigmar Gabriel, Germany’s economy minister, objected strenuously this week to a clause in the deal that would allow companies to sue governments if they felt their rights had been infringed.

The clause is common in bilateral investment deals and initially attracted little attention in the Canada-EU negotiations. But it has become a flashpoint in another set of trade negotiations, between the EU and the United States. The European Parliament, a range of environmental and civil-society groups, and certain German politicians oppose it because they feel it gives multinational firms too much power in their dealings with government.

During a debate in Germany’s Bundestag about the two sets of EU talks, Mr Gabriel said “it’s completely clear we reject these investment-protection agreements” and that the debate was not over yet. In Ottawa, Jose Manuel Barroso, president of the European Commission, questioned whether Mr Gabriel was speaking for the German government, saying that all official communications he had received from Germany were “absolutely in favor of this agreement”.

The text of the trade deal must go through a legal review and translation before being presented to the Canadian and European parliaments for ratification. Reopening it now would kill the agreement, according to Karel De Gucht, the European trade commissioner.

It would also be a blow to Mr Harper. The deal goes well beyond the traditional fare of lower tariffs and higher farm quotas. It also makes it easier for companies in both areas to compete for large government contracts, closes gaps in intellectual-property rules, and allows for mutual recognition of some professional certifications.

Note EU-Digest:  any clause in the deal that would allow companies to sue governments if they felt their rights had been infringed must not be accepted by the EU parliament in any way, shape or form.

Read more: The Canada-EU trade deal: Signed, not sealed | The Economist

Trade: US trying to push for controversial new trade standards in trade negotiations

The US is pushing for controversial new trade standards that would grant radical new political powers to corporations, increase the cost of prescription medications and restrict bank regulation, according to two internal memos obtained by The Huffington Post.

The memos, which come from a government involved in the 12-nation Trans-Pacific Partnership free trade negotiations, detail continued disputes in the talks over the deal. The documents reveal broad disagreement over a host of key positions, and general skepticism that an agreement can be reached by year-end. The Obama administration has urged countries to reach a deal by New Year's Day, though there is no technical deadline.

One memo, which was heavily redacted before being provided to Huffington Post, was written ahead of a new round of talks in Singapore this week. Read the full text of what HuffPost received here. (Note: Ellipses indicate redacted text. Text in brackets has been added by a third party.) Another document, a chart outlining different country positions on the text, dates from early November, before the round of negotiations in Salt Lake City, Utah. View the chart here. Huffington Post was unable to determine which of the 11 non-U.S. nations involved in the talks was responsible for the memo.


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