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Who wants TTIP?

Posted by on April 13, 2015.

Considering the breadth of public antagonism towards both the TTIP and CETA trade agreements, it is worth asking who is driving this legislation.

It cannot be the governments, because we live in democracies and governments exist for the people and because of the people – and it is pretty self-evident that the people do not want these (or similar) trade agreements.


Almost 1.6 million people have already signed a public petition to stop TTIP and CETA. If you haven’t signed this yourself, I would ask you to read this post and then consider your position.

The problem with both of these treaties (and indeed with the similar TPP treaty) is the section dealing with ISDS (Investor-State Dispute Settlement). In principle this is not a bad thing. Its purpose is to prevent one member state from creating local laws that favour their own businesses over the businesses of other member states — its purpose is to prevent protectionism within a free trade area.

Let us say that a company from one member country finds that its market in another member country has been adversely affected by new protectionist legislation that favours local national companies. This is unfair in a free trade environment, and must obviously not be allowed. But who should arbitrate in such circumstances? It cannot be the national courts because they could be considered biased.

The treaties’ solution is to constitute special courts to deal with such disputes. This solution, however, is worse than the problem. Here’s how the EFF, a US-based civil liberties group, describes it:

The construction of these investor-state courts hardly allow for impartial rulemaking. In existing ISDS courts, they are comprised of three private-sector attorneys who take turns being judge and/or corporate advocate. Corporate plaintiffs in ISDS cases can demand hundreds of millions, or even billions of dollars in damages against countries. Even a threat of an ISDS case can be enough for nations to strike down whatever policy a corporation doesn’t like, because they simply cannot afford to lose and be forced to pay such exorbitant penalties.
EU-US Trade Negotiations Continue Shutting out the Public—When Will They Learn?

There are three big international free trade agreements in the pipeline: TPP, CETA and TTIP. Each has its own ISDS chapter. TTP is probably nearer to fulfillment than the others. Last month WikiLeaks published a leaked copy of the chapter covering ISDS. It was stamped, this document “is supposed to be kept secret for four years after the entry into force of the TPP agreement or, if no agreement is reached, for four years from the close of the negotiations”. In other words, we the people who pay the negotiators, are not supposed to know anything about it until it is a fait accompli that we cannot alter.

Lori Wallach, director of Public Citizen’s Global Trade Watch, commented,

With the veil of secrecy ripped back, finally everyone can see for themselves that the TPP would give multinational corporations extraordinary new powers that undermine our sovereignty, expose US taxpayers to billions in new liability and privilege foreign firms operating here with special rights not available to US firms under US law.
Leaked dispute-settlement plan raises US trade concerns

This will apply to all trade agreements that include the ISDS provision – and that is all three of the big treaties. Wallach’s comment can be changed to represent any and all countries that sign up to any and all treaties containing ISDS. For example, it would be equally true to say,

With the veil of secrecy ripped back, finally everyone can see for themselves that the TTIP would give multinational corporations extraordinary new powers that undermine our sovereignty, expose EU taxpayers to billions in new liability and privilege foreign firms operating here with special rights not available to EU firms under EU law.

Just pause for a moment and ask yourself what effect that might have in relation to companies like Google, Facebook and Microsoft if the TTIP is signed off before Europe enacts its proposed new privacy laws. Since the GDPR will undoubtedly interfere with the established business processes of these big US companies (that is, selling personal data for their profit), will the GDPR even be possible? And if it is enacted, will that allow these US companies to sue Europe for billions of dollars?

At this point you might say to yourself, he’s fear-mongering. It could never happen. Well, enter Philip Morris and Uruguay. Philip Morris is a tobacco firm operating out of Switzerland. Uruguay is a country with stringent anti-smoking laws. Switzerland and Uruguay have a trade agreement that includes an ISDS chapter.

Philip Morris is suing Uruguay on the basis that its internal laws are making it difficult for the tobacco company to turn a profit in Uruguay. Specifically, it is claiming that Uruguay’s laws that require 80% of the cigarette packet to comprise anti-smoking material do not leave enough room for its trademarks – but make no mistake; this is all about money.

But — you might say — suing a small South American country is not the same as suing one of the big developed countries…

The Uruguayan case pre-dates the more famous but similar ISDS case brought by Philip Morris against Australia when the country banned logos on cigarette packets. The tobacco giant’s attack on Australia, which is ongoing, led New Zealand to U-turn on a decision to follow its bigger neighbour with plain packaging.
The Independent: Big Tobacco puts countries on trial as concerns over TTIP deals mount

With no shadow of a doubt, if TTIP and CETA go ahead, large international corporations will start dictating national law to suit their own profits. Do we really want tobacco firms, with all the misery and disease associated with smoking; or large technology companies that have got fat through manipulating and selling our personal, private information, to be able tell our governments what they can and cannot do? Stop TTIP and CETA now. After all, we live in a democracy, right?

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Submitted in: Expert Views, Kevin Townsend's opinions | Tags: , , ,