European Commission Admits Defeat In Trying To Improve Corporate Sovereignty Chapter In CETA

from the now-what? dept

The excitement over the mad dash to finish TPP -- and the failure to do so -- has rather obscured the other so-called trade deals currently being negotiated, such as TAFTA/TTIP and the one between the EU and Canada, CETA. As Techdirt has reported, CETA is even further along than TPP, in what is known as the "legal scrub" phase when the lawyers tweak the agreed text in an attempt to catch drafting errors or other infelicities. Back in June, the EU commissioner responsible for trade and trade agreements, Cecilia Malmström, told Politico.eu that CETA "could be done by the end of July". That obviously didn't happen, or we would presumably have heard about it by now. The Politico.eu article gives a clue as to why not:

Malmström acknowledged that the most delicate part of the legal scrubbing, the clauses about the investor state dispute settlement, also referred to as ISDS, still remain. "We haven't started with that yet," she said, arguing that only three pages of the treaty deals with the sensitive issue, whereas "there are 1597 pages talking about other things."
So the festering wound that is corporate sovereignty, formally "investor-state dispute settlement" (ISDS), could well be the problem here. Back in March of this year, on the subject of corporate sovereignty in CETA, Malmström said:
We will propose any further changes [in ISDS] we collectively agree on in TTIP to the Canadian government.
This promise seems to have been based on the optimistic idea that the European Commission would actually be able to come up with some improvements to ISDS in the wake of its massive rejection by the public in the Commission's consultation on the subject. It's true that Malmström went on to present some very vague ideas about ways in which corporate sovereignty could be "improved", but so far these have not been turned into concrete proposals that could be discussed with the Canadian government.

Given that failure, it should perhaps come as no surprise that Zeit Online is reporting (original in German) that Malmström now has no plans to try to change CETA for the better before it is signed, merely saying that afterwards there will be a "check" on the ISDS mechanism -- a worthless promise, since at that point Canada will have zero reason to make any concessions.

But signing CETA with the current corporate sovereignty chapter is a big problem. CETA's ISDS is actually worse than previous approaches, despite repeated claims to the contrary by the European Commission. But by way of consolation, leaving it untouched may also make getting CETA passed much harder. As we wrote in February, there are some indications that German's Chancellor, Angela Merkel, is not happy about the current ISDS chapter in CETA, while the French government has said that if the ISDS chapter is not re-written, France will not ratify the treaty.

Similarly, in a non-binding but significant set of recommendations to the European Commission regarding TTIP, the European Parliament said that ISDS must be replaced with "a new system for resolving disputes between investors and states which is subject to democratic principles and scrutiny" -- hinting that, without such a new system, it would vote against TTIP. If that is its position on TTIP, it would make no sense not to apply it to CETA, too: since US companies will be able to use their Canadian subsidiaries to sue the EU by invoking CETA's corporate sovereignty chapter, a bad ISDS in CETA would undermine a "better" one in TTIP.

Of course, politicians are notoriously fickle, so it's by no means certain that national governments and the European Parliament will stick to these stated positions when it comes to the actual votes for CETA and TAFTA/TTIP. But there's no doubt that the European Commission's failure to come up with even the mildest of face-saving changes to CETA's corporate sovereignty provisions has just made the task of pushing the deals through a little bit harder.

Follow me @glynmoody on Twitter or identi.ca, and +glynmoody on Google+


Reader Comments

Subscribe: RSS

View by: Time | Thread


  • identicon
    Anonymous Coward, 3 Sep 2015 @ 11:29pm

    here's an improvement

    drop corporate sovereignty from the text altogether.
    Bussiness should find it's way without it, all it takes is taking the human factor in the picture and not just profit charts.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 3 Sep 2015 @ 11:56pm

    who came up with that nonsense of: "We don't agree but we sign it anyway."?

    Is there some way of putting pressure on those policitians so they start to work for us - the people?

    Then they can put the pressure on the corporations that come up with these lousy proposals.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 4 Sep 2015 @ 9:11am

      Re:

      It seems more like a legacy thing: When a deal was struck, it implicitly was assumed that the economic benefits calculated before the negotiation started would be realized and since voting no would practically be a "lack of confidence" in the people negotiating on the politicians behalf, it required very strong arguments to turn it down.

      Today the deals are low in real free trade in the classical sense (The legacy of Adam Smith.) and high on legal harmonisation (The way these are being negotiated - almost entirely between special interests - could easily be argued as in opposition to Smith and his anti-collution ideas!).

      That the politicians doesn't work for "the people" is nothing new. The corporate ownership of politics has reached a point (in visibility through openness of administration and economic power) where even most corporations agree that something has to be done - they are infighting to buy the limited ressource of politicians. What is required to solve the situation, though, is unanswered and thus the status quo remains.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 3 Sep 2015 @ 11:58pm

    Qui bono?

    If our politicians would only get their heads out of the corporate honey-pot long enough to represent the People, this could be over in the time it takes to toss this and other industry-drafted treaties in the bin.

    reply to this | link to this | view in chronology ]

  • identicon
    Parsly sage rosemery and tyme, 4 Sep 2015 @ 1:45am

    We would have heard of it

    did you forget that TPP included keeping it secret for 4 years AFTER it was agreed?

    reply to this | link to this | view in chronology ]

  • identicon
    Dick, 4 Sep 2015 @ 3:22am

    Where is your due diligence?

    If you had read the article in its entirety, you would have understood that they (Malmström and the journalist) meant July 2016, not 2015...

    I suppose this shows how well you dig into your issues before writing about it.

    Where is your due diligence?

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 4 Sep 2015 @ 4:20am

      Reading comprehension much?

      From the article, dated June 23, 2015:

      EU trade chief Cecilia Malmström said Tuesday the bloc’s pending trade pact with Canada could be done by the end of July, but acknowledged the more controversial EU-U.S. agreement will get pushed to next year.

      reply to this | link to this | view in chronology ]

      • identicon
        Dick, 4 Sep 2015 @ 6:34am

        Re: Reading comprehension much?

        Read the end of the article:
        "The Canadian agreement needs to be translated into all 24 official working languages of the EU before the ratification process in the European parliament could start, which would be in spring 2016 if there are no further delays."

        I was at the event...She said July next year!

        reply to this | link to this | view in chronology ]

        • icon
          Cerberus (profile), 4 Sep 2015 @ 9:58am

          Re: Re: Reading comprehension much?

          Perhaps people are talking about different kinds of "finished"? First the text was to be finished in English (suggested to be July this year), and then it had to be translated into 24 languages, approved by various governments and agencies, and finally ratified in the spring of 2016. So when is it finished: when nothing can be changed about the text any more (Juny 2015) or when it is ratified (spring 2016)?

          Do you remember what she said exactly at the conference, about which kind of "finishing" she was talking when she said July (of whichever year)? Ratification was clearly impossible by July 2015, but finalising the English text between the negotiatiors only might have been possible in theory?

          reply to this | link to this | view in chronology ]

          • identicon
            Dick, 11 Sep 2015 @ 3:47am

            Re: Re: Re: Reading comprehension much?

            She meant finished as in ratification over. She said July next year.
            As you say, ratification impossible by July 2015. The conference was in June...!

            European Commission has always said legal scrub + translation done by end of 2015.

            Canadian October elections may move this back a bit?

            reply to this | link to this | view in chronology ]

    • identicon
      Glyn Moody, 4 Sep 2015 @ 4:21am

      Re: Where is your due diligence?

      The first paragraph of the Politico article reads:

      "EU trade chief Cecilia Malmström said Tuesday the bloc’s pending trade pact with Canada could be done by the end of July, but acknowledged the more controversial EU-U.S. agreement will get pushed to next year."

      So she is saying that CETA could be done by the end of July *this year*, but that TAFTA/TTIP will get pushed to 2016. Later on in the article she says:

      "On the EU-U.S. trade deal, which is far less advanced, Malmström acknowledged that it would not be finalized this year, but repeated a goal to get it done by the end of the administration of U.S. President Barack Obama."

      Again, that makes it clear that it is TTIP that she hopes will be completed in 2016, unlike CETA, which she still evidently believed could be finished by July 2015.

      Finally, a paragraph near the end says:

      "The Canadian agreement needs to be translated into all 24 official working languages of the EU before the ratification process in the European parliament could start, which would be in spring 2016 if there are no further delays."

      So ratification of CETA was to have taken place in spring 2016, if it had been completed in July 2015, as she hoped it would be.

      reply to this | link to this | view in chronology ]

      • identicon
        Dick, 4 Sep 2015 @ 6:40am

        Re: Re: Where is your due diligence?

        Article unfortunately written. But the last part represents what she says.
        I was at the event. She said July next year!

        If you check the EC Work Programme for second half of 2015, it says that they will propose text for Council signature / Conclusion on CETA in December 2015.

        So EVIDENTLY was supposed to be July 2016!
        http://ec.europa.eu/atwork/pdf/planned_commission_initiatives_2015.pdf

        AGAIN, get your due diligence right guys!

        reply to this | link to this | view in chronology ]

      • icon
        BernardoVerda (profile), 4 Sep 2015 @ 11:03pm

        Re: Re: Where is your due diligence?

        "The Canadian agreement needs to be translated into all 24 official working languages of the EU before the ratification process in the European parliament could start..."

        So... will the get that right, this time around?
        Translation is tricky enough, when there's plenty of time, and little room for differing interpretations -- and they've blown the job before (more than once).

        Or is this going to be another one of those "each language-version is equally authoritative" messes?

        reply to this | link to this | view in chronology ]

  • icon
    Goyo (profile), 4 Sep 2015 @ 5:16am

    "Of course, politicians are notoriously fickle"

    And that's what it all boils down to.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 4 Sep 2015 @ 6:31am

    Best case scenario I see is that if NDP wins the Canadian elections they kill the deal outright. One can only hope

    reply to this | link to this | view in chronology ]

  • icon
    Mason Wheeler (profile), 4 Sep 2015 @ 7:00am

    It's true that Malmström went on to present some very vague ideas about ways in which corporate sovereignty could be "improved", but so far these have not been turned into concrete proposals that could be discussed with the Canadian government.

    Apparently he's not listening. Or maybe the public hasn't quite been clear enough. They should just come right out and say it bluntly: the only good ISDS is a dead ISDS.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 4 Sep 2015 @ 7:25am

    there may well only be a couple or so pages of ISDS, but they infect every one of the 1597 other pages, and, not a single one of them has officially been released to the biggest stakeholders, THE GENERAL PUBLIC, who dont have a clue what they will be getting until it's too late and they have got it!

    reply to this | link to this | view in chronology ]

  • identicon
    David E.H. Smith, 5 Sep 2015 @ 2:31am

    The CETA, TPP ELECTION; Canada 2015;

    Conservatives, NDP, Liberals, Support Corporate Canada’s Punishing the harmless voters, both Native & non Native (& citizens of TPP) by way of SECRET TPP, et al, Tribunals’ Punitive Penalties, Fines, Costs & Awards.
    GREENs Against TPP & other Global Corporate Treaties/’Arrangements’ & Clauses Giving Power to Global Corporate Economy to Make Secret Changes and Any & All Discretionary $elf-Improvement$ without Notification, Discussion & Approval and at Any Time; ie. ’Oh, & by the Way…’ clauses.
    TRUE: X , or, False: ___.

    Corporate Canada’s Traditional, BIG 3 Parties, NDP, LIBs, CONs, Desperate for Superseding Global Corporate Treaties/’Arrangements’ to Wipe Out Native Canadian, et al, ‘Gains; Only GREEN Party Standing Up Against Global Corporate Economy’s Insider Trading & SECRET ‘Death-Star-Chamber’ ISDS Tribunals, et al?
    Can the Voters make the DISTINCTION between; the bullying politicians, both; Native & non Native, who need to continue to Deprive their members of the Information (eg. The WAD Accord’s Compensation)& to Punish those who have been Deprived of the Info and those who need to Share the Info in order to protect the Human Rights of Unborn Native Canadians, et al? Corporate Canada’s Big 3 Parties do NOT want YOU to make the DISTINCTION.

    Corporate ‘U.S.’ is desperate to Legitimize & Globalize (TPP/TTIP/CETA) ‘Full Invasion’; HSBC’s money laundering, Enron’s insider trading, Chase Bank’s fraud, etc. after its 2008 ‘Tactical Probe’ into Deregulation & Buying Short on Designer Meltdown leads to Global Recession, but, Non-Guilty. Corporate Canada & its Traditional Big 3 Political Parties are Anxious to increase its play time under the ‘skirts’ of Corporate U.S. in the International Economic Glitter Game.

    The Traditional Big 3 Parties vs. GREENs & Quebec;ANTI-Globalists (GREENs) PROHIBITED from Debating TPP, et al, in Corporate Canada’s Election ‘Debates’. For 'NO' to Global Treaties/”Arrangements’ just VOTE for the GREEN Party’ Canada’s Big 3 Traditional Parties tell Voters.

    How long have Global Corporate Associates been ‘Passing’ Legislation in Anticipation of Suing Once Ratified? ‘Trickle’ Up & Out Economics.

    After New Zealand’s PM admitted that medicines will cost more due to the TPP, have the citizens of New Zealand & TPP, noticed PM Harper cuts funding for Canadian health care by $36 million & unchallenged by other parties, exacerbation leading to privatizing health care, etc. to pay TPP penalties to Global Corporate Assocs.

    TPP nations, et al, need ‘good corporate citizens’ that respect our legislation & need to ‘out’ bad corporate voters via shareholder meetings; ‘persona non grata’?
    Americans, Japanese, et al, look forward to working with Savvy Slave Trading Malaysians & Slick Cultural ‘Genociding’ Canadians. ‘But, we didn’t know’.
    Traditional Canadian Parties Demanding Supplicance to Corporate Canada & its Global Corporate Assocs. is an unholy sin?

    Will Pope Francis & other leaders Intercede with prayer against PM Harper, Corporate Canada, The Canadian Establishment, et al, for Continuing to Blame & Punish those who are continuing to be Deprived of the Due Diligence Info and Continuing its Cultural Genocide.

    CUTTING the FUNDING to Native Canadians, et al, is GREAT
    for Corporate Canada's Conservatives, NDP & Liberals Pro-TPP & other Global Corporate Treaties/'Arrangements',
    as it allows them to pay & reward themselves by way the Secret 'Trade' Treaties' Tribunals without having to take yet another exacerbating & very noticeable $36 million cut out of the 'soon' to be privatized of health care, post-secondary education, et al.
    by David E.H. Smith, ‘Qui tam…’
    *** FULL Article, see; davidehsmith.wordpress.com
    *** Please consider sharing the enclosed information & questions with 10 friends who will share it with 10 others...

    reply to this | link to this | view in chronology ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Use markdown for basic formatting. HTML is no longer supported.
  Save me a cookie
Follow Techdirt
Techdirt Gear
Shop Now: Caution: Copyright
Advertisement
Report this ad  |  Hide Techdirt ads
Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Advertisement
Report this ad  |  Hide Techdirt ads
Recent Stories
Advertisement
Report this ad  |  Hide Techdirt ads

Close

Email This

This feature is only available to registered users. Register or sign in to use it.