From the TUC

EU trade deal with Canada amended: not good enough

02 Mar 2016, by in International

On Monday, European Trade Commissioner Cecilia Malmström trumpeted what she called a major step forward on trade – a revised version of the Comprehensive Economic and Trade Agreement (CETA) between the EU and Canada. The main difference was that in place of the infamous Investor-State Dispute Settlement (ISDS) provisions, the new Liberal Canadian government had agreed to the ISDS-lite which goes by the name of the Investor Court System (ICS). “Plus ça change, plus ça la meme chôse,” as they say in francophone Quebec. Or “it’s just not good enough,” as we say in the TUC. And the USA may not be best pleased, either.

There are good things in CETA, like tariff reductions and protections for Geographical Indicators – measures which protect marques like parma ham and stilton cheese. But the TUC will be calling for MEPs in the European Parliament, and later on MPs at Westminster, to vote the deal down, for three main reasons:

  1. ICS is a bit better than ISDS. It has an appeals mechanism, and measures to prevent flagrant conflicts of interest. And there are fine words about the rights of governments, as well as investors (although whether they are meaningful depends on how the courts interpret them.) But among the flaws retained from ISDS, there is an over-generous definition of the sorts of ‘losses’ investors can claim compensation for (eg profits on contracts they haven’t even been awarded!) and there is the biggest problem of all – a special system of justice just for foreign investors, available to no one else. You can read more about the flaws of ICS here.
  2. CETA does not protect public services from increasing liberalisation. Sorry for the jargon, but unlike previous EU trade deals such as with South Korea which used a ‘positive list’ system, CETA uses a ‘negative list’ for determining market access and national treatment rules – meaning governments can only fully protect the public services they explicitly list in the annexes to the deal. And the UK government has listed far too few bits of the NHS and public sector (and of course hasn’t listed public services that could be developed in the future.)
  3. And the provisions of CETA don’t adequately protect workplace rights either. Unlike the billion dollar settlements foreign investors can obtain through ICS, trade unions can seek a stiffly worded letter of criticism from a group of eminent experts under the sustainable development chapter. Hardly enough to defend our rights at work and of course totally out of balance with the protections offered to foreign investors.

Opposition is being expressed by Canadian and European NGOs like Trade Justice Network in Canada and Friends of the Earth in the EU.  The Canadian Labour Congress (CLC) and European Trade Union Confederation (ETUC) are also likely to oppose the deal: the TUC will certainly be urging them to.

One of the problems with CETA is that it’s not as well known as its big brother the Transatlantic Trade and Investment Partnership (TTIP), but it will be put to the European Parliament before TTIP negotiations are even concluded (possibly as early as before the summer break) and it contains the threat that if investors based in the US also have bases in Canada (or set them up), they will be able to use CETA to take EU governments to the ICS before TTIP is even agreed.

Mind you, it’s not all plain sailing with TTIP, because the US government is still committed to ISDS without the ICS camouflage, and US negotiators gave what is understood to be a cool reception to the ICS proposals tabled by EU negotiators at the latest (12th) TTIP negotiating round in Brussels last week. Ultra-Liberal Swedish MEP Christofer Fjellner, who sits on the European Parliament’s international trade committee INTSA went further, tweeting on Monday that including ICS in CETA would make it more difficult to finalise the TTIP negotiations.

So, we’re not impressed. And until trade negotiators on both sides of the Atlantic start taking ordinary people’s concerns about their trade agreements seriously, we will continue to oppose them all.

UPDATE – an amendment has been made to the section on the ‘negative list’ system to correct a previous inaccuracy.

One Response to EU trade deal with Canada amended: not good enough

  1. George
    Mar 2nd 2016, 2:10 pm

    My real question with ISDS and it’s ilk is: “What will my country look like after 50 years of this?” In Canada, out tobacco policy has already been shaped, not by an ISDS settlement in Canada, but one in Argentina. NAFT settlements have shaped, or will shape, our environmental policy, agriculture, and resource extraction policy.
    By the time CETA, TPP, NAFTA, and so on have run their course, our national and local governments will have no say at all in managing our climate, economy, or resources. Not a very good situation for managing climate change, or the welfare of ordinary citizens.