German television show leaks CETA, Council of Canadians says deal will not survive public scrutin

The Council of Canadians is pleased that the Canada-EU trade deal, the Comprehensive Economic and Trade Agreement (CETA), has seen the light of day after German television show Tagesschau provided the full text online this afternoon.

 

“Throughout the process, this agreement and its devastating impacts have been kept locked away from legislators and the public, shielded from a democratic process. Finally, it comes to light, probably because people in Germany are fed up with the secrecy and fed up with being taken hostage by companies,” says Maude Barlow, Council of Canadians national chairperson.

 

The Harper government has celebrated the completion of the agreement this week, setting a signing date of September 26. CETA’s investor-state dispute settlement provisions have been on the radar in Germany, where there is opposition to them. They would allow corporations to sue countries for lost profit. The Vattenfall decision, where a company sued Germany for pulling out of the nuclear industry, is fresh in Germany’s mind after the Fukushima nuclear accident.

 

“Obviously, the Harper government is tone deaf when it comes to relations with Germany and the growing opposition to CETA. We are committed to working with the opposition in Europe to kill this ‘corporate bill of rights,’” remarked Barlow.

 

Other observations:

 

• This text (and earlier versions of it) should have been made public to give the public the appropriate amount of time to read it, discern its contents and comment on it fully. The whole CETA negotiation process has been undemocratic, and has failed in terms of transparency.
• The 25-page investor-state section appears to be a standard investor-state dispute settlement: a three-person panel that would make decisions rather than the mature court systems. This probably will not placate Germany.
• The 30-page procurement section appears to give no consideration to the numerous Canadian municipalities that requested to be exempted from its provisions.
• The EU language was adopted on resolution of pharmaceutical patent disputes. This will open the flood gates to pharmaceutical companies’ law suits. This will lengthen patent lengths and delay generics coming to market. In the end, this could severely increase public health care costs by $900 million to $1.7 billion.
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The Council of Canadians is a major player in this battle and was the first to challenge CETA. The Council is available for further comment on this breaking story.

 

See http://www.canadians.org/blog/ceta-will-likely-be-signed-it-will-also-implode for more information.

Investor-State Dispute Settlement in the TTIP and CETA

Submission to the European Commission's Public Consultation

One of the most controversial elements of modern trade treaties is the investor-state dispute settlement (ISDS) mechanism, which allows foreign investors to bypass domestic courts and directly challenge government measures before unaccountable arbitration tribunals. 

ISDS is slated to be a key feature of the Transatlantic Trade and Investment Partnership (TTIP) currently being negotiated between the U.S. and the European Union (EU). The planned provisions are modelled on the ISDS mechanism in the Canada-EU Comprehensive Economic and Trade Agreement (CETA). 

Faced with unprecedented levels of public criticism, however, the European Commission has paused the TTIP negotiations on ISDS in order to consult the public.  In his submission to the consultation, Scott Sinclair, CCPA’s senior trade policy researcher, argues that there is no credible justification for including ISDS in either the CETA or the TTIP. - See more at: https://www.policyalternatives.ca/publications/reports/investor-state-dispute-settlement-ttip-and-ceta#sthash.QkJoO0GA.dpuf

121 scholars speak out against planned investor-state arbitration provisions in the U.S.-E.U. TTIP, modeled on the Canada-E.U. CETA

A group of 121 academic experts has spoken out against planned provisions on investor-state arbitration in the Transatlantic Trade and Investment Partnership. The provisions are modeled on the investor-state arbitration provisions in the Canada-E.U. Comprehensive Economic and Trade Agreement (CETA).

The academics include leading international experts in trade and investment law, EU law, international law and human rights, constitutional law, private law, political economy and other fields. They criticize the investor-state arbitration provisions for failing to protect the right to regulate, displacing the role of courts, and failing to ensure basic safeguards of judicial independence in investor-state arbitration.

The full text and list of signatories can be found here: https://www.kent.ac.uk/law/isds_treaty_consultation.html

The scholars have spoken out in a contribution to a public consultation launched by the European Commission in the face of strong public interest and growing concern about the issue. They criticize the Commission for failing to make a plausible case for the need for investor-state arbitration provisions. They welcome, on the other hand, the Commission’s recognition of serious flaws and shortcomings of the international investment arbitration regime as it has developed over the last few decades.

In launching the consultation, Commissioner De Gucht acknowledged these problems and announced the ambition to ‘re-do’ investment law, make the system ‘more transparent and impartial’, ‘build a legally water-tight system’, and ‘close these legal loopholes once and for all.’ These objectives may be laudable but the proposed approach falls far short of achieving them.

The scholars express the hope that the controversy over investor-state arbitration in Europe will prompt a broad and serious debate about existing and new investment treaties. Investment law is far too important to leave to trade officials and investment lawyers.

The submission was written by Peter Muchlinski (SOAS School of Law), Horatia Muir Watt (Sciences Po Law School), Harm Schepel (Kent Law School), and Gus Van Harten (Osgoode Hall Law School).

Contact: Harm Schepel, h.j.c.schepel@kent.ac.uk; Gus Van Harten, gvanharten@osgoode.yorku.ca

 

Examples of academic experts’ comments on the proposals for investor-state arbitration in the U.S.-E.U. TTIP and Canada-E.U. CETA

 

On the right to regulate:

The approach “[f]ails to protect the ‘right to regulate’ as a general right of states alongside the many elaborate rights and protections of foreign investors, let alone as a component of the FET and Expropriation standards”. “By its omissions, the consultation text actually confirms boldly that the right to regulate has not been affirmed and preserved, by a clear and unequivocal statement of the right, alongside the rights and protections of foreign investors.”

On conflicts of interest among investor-state arbitrators:

“The Commission, rightly, has misgivings about the standards of ethical behavior and conflicts of interest that prevail in the investment arbitration regime. The reference text from CETA does not assuage the fears…. It is imperative… to make sure that no one who stands to profit in any way from the income generated by the representation of parties to investment disputes acts as an arbitrator.”

On the Commission’s proposal for a code of conduct for investor-state arbitrators:

The Commission “is so vague on the contents of this code that is difficult to come to any judgment”. “Even with the most robust code of conduct, the absence of basic institutional safeguards of judicial independence undermines fundamentally the claims of investor-state arbitration to neutrality and impartiality.”

On the use of arbitrators instead of judges:

“[T]he Commission seems content to entrust to these same actors the vital constitutional task of weighing and balancing the right to regulate of sovereign states and the property rights of foreign investors. This task is one of the most profound roles that can be assigned to any national or international judicial body. To entrust these decisions to the very actors who have an apparent financial interest in the current situation and moreover remain unaccountable to society at large is a contentious situation…. [T]here seems to be consensus that the regime falls short of the standards required of an institutionally independent and accountable dispute settlement system.”

On protecting public funds in a sovereign debt crisis:

The Commission’s proposal “[f]ails to exclude acquisitions of sovereign debt instruments from the scope of the Treaty”. “In light of the social misery and hardship the sovereign debt crisis has brought, it requires little discussion to conclude that the mere thought of speculative investors in government bonds seeking damages before investment arbitration Tribunals is utterly unacceptable.”