EU-Canada Trade Agreement May Be Incompatible With EU Law

from the too-ambitious dept

Just as it did with the Anti-Counterfeiting Trade Agreement (ACTA), Germany is leading the fight against both TAFTA/TTIP and the recently-concluded trade agreement between the EU and Canada (CETA). That’s clear from the fact that of the 1,115,000 European citizens who have signed an online petition calling for both TTIP and CETA to be dropped, 673,000 come from Germany. The most powerful anti-TTIP organisation, Campact, is also based in Germany, and points us to this legal analysis of CETA, and the extent to which it may be incompatible with EU and German law (pdf):

The following opinion assesses whether this “CETA Consolidated Text” of August 5th, 2014 complies with EU and [German] constitutional law. The opinion is limited to some selected regulatory fields of CETA. It does not claim to be exhaustive, but focuses on those provisions that dominate public discussion.

It’s rigorous stuff and pretty dry, but the conclusions are clear enough. For example, it confirms that CETA is a “mixed agreement.” That means it must be ratified by the EU and every one of the 28 Member States — a much higher hurdle to clear than just EU approval. It identifies the corporate sovereignty provisions — “investor-state dispute settlement” — as a problem:

The establishment of investor-state arbitration tribunals in CETA violates the judicial monopoly of jurisdiction laid down in EU law (Article 19 TEU [Treaty on European Union] in conjunction with Articles 263ff TFEU [Treaty on the Functioning of the European Union]) and [German] constitutional law (Article 92 BL). Furthermore, the EU does not have the competence to extend such a procedure to portfolio investments and to the field of financial services.

This has been a common criticism of ISDS — that it creates a parallel legal system only available to corporations, and which can overrule national courts. It’s a consequence of the fact that CETA is not just a trade agreement, but affects many areas of daily life that are normally determined by politicians, not unaccountable negotiators working in secret, as is the case with the EU-Canadian agreement.

Of course, this is just one legal opinion, and doubtless the European Commission would beg to differ. But it does indicate that the very ambition of CETA — and therefore also TAFTA/TTIP, which is very similar in this respect — may be its downfall. By seeking to move “behind the borders”, tackling “non-tariff barriers” that are actually regulations protecting health, safety, the environment, etc., these agreements may interfere with too many core functions of how a democracy works, and be struck down by the courts as a result.

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Comments on “EU-Canada Trade Agreement May Be Incompatible With EU Law”

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Anonymous Coward says:

Re: Re:

Don’t celebrate too soon. This treaty has not been stopped yet. Sure, ACTA has made some politicians read these types of treaties, but most rely on cliffnotes and the opinions of their favourite lobbyists. One of the common lobbyists are the commission.

The fall of ACTA was a very special event and it has caused quite some damage to both sides of the issue politically. If CETA falls, TTIP is very likely to fall too since the commission has publically proclaimed that CETA was the golden standard for the TTIP negotiations and TTIPs provisions would follow that template:

“CETA is a landmark agreement and the lessons learned during the CETA talks will certainly inspire the EU negotiators working with the US. Our ambition in both sets of talks is similar: we want to create a comprehensive agreement that helps our companies prosper in the transatlantic market place in order to generate growth and create jobs.”
What a puff-piece commercial by the commission. They are nowhere in the vicinity of objective on these matters.

The politicians representing companies can never let CETA fall since it would likely kill TTIP too. So far politicians have ignored the issues and CETA has been running under the radar in most places because of the classic radio silence from media outside of Germany. But things are cooking for quite a heavy fight in EU again since CETA has been compared to ACTA on several issues and the ISDS does seem to go extremely close to the politicians rights to legislate (While the commission have taken several precautions, they are dancing on a knives edge: One issue where a case is borderline can completely torpedo the democracy of the countries by attacking the fundamentals of separation of power, the sovereignty of judiciary and the subsidiarity of economic interests to the rule of law, how weak that may be already. It is better not to risk ruining these basics in a desperate attempt to increase potential GDP growth by 0,05 % per year at best.).

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