MPs will have to take a stand on trade deal investor privileges
The European Commission’s ground-breaking consultation on the investment chapter of the forthcoming Transatlantic Trade & Investment Partnership (TTIP) is nearly over (but you’ve still got time to submit your views – the deadline is 6 July.) And now pressure is mounting for MPs to take a stand on the most noxious element of such chapters: the Investor-State Dispute Settlement (ISDS) process which provides private investors with a way to put their interests ahead of the public interest.
EU rules have made negotiating and signing trade agreements the exclusive competence of the EU (although under the supervision of the Council of Ministers, so as usual, national politicians really cannot claim it’s “nothing to do with them”.) But those trade agreements nowadays go so much further than classical free trade – which used to mean tariff reduction – that the EU’s exclusive competence doesn’t cover agreements like TTIP and the EU-Canada Comprehensive Economic and Trade Agreement (CETA) precisely because they cover investment, which is still a national competence.
The UK is currently completing a Bilateral Investment Treaty (BIT) with Colombia, for instance, completely separate from the notorious EU-Colombia-Peru Free Trade Agreement which has – as expected – failed to protect workers’ rights to collective bargaining, freedom to associate and even life and liberty! With our friends in the Trade Justice Movement and Justice for Colombia, the TUC is urging MPs to force the UK-Colombia BIT to a Parliamentary vote, and to oppose it because it too fails to defend workers’ rights, and contains democracy-busting ISDS provisions. Labour MPs have already pressed Ministers on these very issues, so the Government can’t say they weren’t aware of these concerns.
CETA is much nearer to completion than TTIP, but because it covers much smaller bilateral trade volumes than TTIP (and, arguably, because Canada is more like the social market economy of the EU than the red-blooded free market US economy), it hasn’t been subject to nearly as much public scrutiny or criticism (although the CLC and ETUC expressed concerns over a year ago.) So CETA contains much more toxic language than unions hope TTIP will involve, including an unreformed ISDS mechanism.
The Canadian Labour Congress decided at its convention in May to oppose CETA, partly because it includes ISDS, and European unions may take a similar line. And because of ISDS, that may mean Westminster politicians will need to take decisions about CETA, rather than ‘delegating’ upwards to the much more secretive environment of the Council of Ministers where the decision would be left to David Cameron and Vince Cable.)
CETA and TTIP, because of their investment chapters, are likely to be classified as ‘mixed agreements’ requiring ratification by each of the 28 national parliaments around the EU. The chairs of 16 countries’ Europe scrutiny committees (including arch-europhobe Bill Cash MP and just as arch Europhile Lord Tim Boswell) have just written to outgoing EU Trade Commissioner Karel de Gucht to say so.
Because some of the Lisbon Treaty rules about mixed agreements are untested, there is some uncertainty about what this will mean for CETA and TTIP as a whole. The Commission has argued that the non-mixed elements of such agreements come into force when the Council of Ministers ratifies trade agreements, with the mixed elements coming into force only when the national votes are all in. Whether that will still apply for TTIP, which de Gucht has said the US will not ratify without ISDS, is currently a moot point, but may not be for long!
It looks like British MPs won’t be able to dodge making a decision about ISDS for much longer, and the TUC will be asking them to reject it.