From the TUC

European Parliament view on EU-US trade deal

09 Jul 2015, by in International

The European Parliament has finally voted on its resolution about the Transatlantic Trade & Investment Partnership, or TTIP, the EU-US trade deal being negotiated by Commissioner Cecilia Malmstrom and US Trade Representative Mike Froman.  Most of the news yesterday was about a compromise over investor protection, essentially replacing Investor-State Dispute Settlement (ISDS) with ISDS-lite. Despite what some of the architects of that compromise say, the European Parliament voted today to maintain a uniquely privileged status for foreign investors, something Conservative MEP Sajjad Karim made clear in his blog. But the resolution eventually adopted – however positively it is spun by TTIP’s supporters – is a step towards a fairer trade system, and it lays the foundation for campaigning over the next few months and years. In a phrase many will recognise, I’d assess the picture this morning as “a lot done, a lot more to do.”

So what happened in the European Parliament? The night before voting began, European Parliament President Martin Schulz added to his lengthening list of shoddy manoeuvres by reversing the voting order for the debate so that Amendment 40 – the last chance for MEPs to vote outright against ISDS – would fall if the compromise version was carried. Many MEPs were mandated to vote for that compromise, but had not been mandated on Amendment 40, so could have voted for that, and prevented the compromise being put to the vote, if the amendment had come up first. It demonstrates just how unsure the coalition of centrist social democrats, liberal democrats and conservatives were that their ISDS-lite compromise would win the vote that they had to manoeuvre the alternative off the order paper.

That left ISDS-lite (Amendment 117) as the only alternative to ISDS on the order paper for the day, and it was carried by 447 to 229 votes, with the European Parliamentary Labour Party the backbone of opposition in the Socialists & Democrats (S&D) group. If every single S&D MEP who voted in favour of the compromise had voted against it, the compromise would have fallen by just 4 votes, but that level of discipline would be difficult to achieve, so in future we also need to persuade more liberal democrats and centre-right MEPs to vote with us if we’re going to defeat ISDS-lite.

ETUC General Secretary Bernadette Segol described the decision thus:

“The Parliament’s vote to reform ISDS defies public opinion, and keeps alive big business’ hopes for special legal privilege. It will enable big business, and big business only,  to challenge policy decisions they don’t like. No-one will be fooled by the Parliament’s idea of abolishing the old ISDS and bringing in a new one: it just delays the real decisions.”

However, it is worth noting that no one defended the harder, original version of ISDS, which is now a dead duck. Commissioner Malmstrom admitted that:

“What today’s vote also signals is that the old system of investor-state dispute settlement should not and cannot be reproduced in TTIP – Parliament’s call today for a ‘new system’ must be heard, and it will be.”

And that’s important, because the US administration is still wedded to it in negotiating TTIP, and more urgently, the old version of ISDS is what has been written into the Canada-EU trade deal (CETA) which has already been agreed and is just waiting to be voted on in the European and national Parliaments – I’ll blog about that more tomorrow.

It’s also worth noting that in terms of British politicians, only the Liberal Democrat and the Conservatives  voted in favour of ISDS-lite, with Labour, the Greens, Plaid Cymru, the SNP and UKIP voting against.

With ISDS-lite voted into the resolution, that was carried overall by 436-241, a slightly smaller majority. The resolution as a whole gives the European Commission an alternative negotiating mandate to the one presented by the Council of Ministers, and despite the ISDS-lite defeat it is more positive, with demands for enforceable safeguards for labour standards, the exclusion of public services like education and health, and a positive list approach to market access, as well as some wording on defending regulatory protections which does not go as far as some would like, but is still tougher than what Governments called for when the TTIP negotiations began.

So, any triumphalism by TTIP fans would be misplaced, although they survived a powerful onslaught from trade unions and the public this time, using every trick in the procedural play book. The European Trade Union Confederation made it clear to MEPs that it opposed ISDS outright, which is a harder position than it has advanced previously, and in line with the TUC’s position. Trade unions and other campaigners made progress on persuading MEPs that ISDS is unacceptable, and now we need to convince them that pale alternatives are almost as bad before the Parliament next votes on the issue.