TTIP: The Green Light for Environmental Exploitation
The inclusion of corporate investment rights in TTIP will undermine the safeguards against environmental exploitation in Europe. De-regulation and investment protection will allow foreign companies to bypass national laws and rules that inhibit environmental exploitation of resources and do as they please. Negotiators must now ensure TTIP gives precedence a to fairer, greener and sustainable transatlantic trade agenda that focuses on the interests of people and not corporations.
The next round of trade negotiations between the European Union and the United States start next week in Brussels with the content and direction of the talks still being kept secret. What is clear however is that powerful industry players and lobby groups are using the Transatlantic Trade and Investment Partnership (TTIP) as a cover for an aggressive de-regulation agenda and much closer public scrutiny is needed.
The trade deal between the EU and US will be biggest bilateral free trade agreement in history. But, it risks becoming a power grab for corporations – a deal that could curb democracy and weaken safeguards that protect people and the planet. It threatens to push the big businesses de-regulation agenda onto unwilling citizens of both continents.
The beneficiaries would be big corporations on both sides of the Atlantic, who stand to make profits out of the possible weakening of standards.
Large corporations, such as energy giant Chevron, are particularly interested in one clause: the investor-to-state dispute settlement (ISDS) mechanism. The ISDS mechanism gives special rights to companies to claim damages if they deem their investments (including future profits) are adversely affected by changes in regulation or policy.
The cases are heard in business-friendly tribunals dominated by corporate lawyers, which are only open to companies and bypass domestic courts. This opens the door for companies to ask governments for millions in compensation for policies that have been made in the public interest.
This means that energy companies for example, could be allowed to seek compensation from governments if they attempt to regulate or ban fracking. This would be regardless of evidence of environmental harm caused by fracking, and of the opposition by local residents and other citizens. Needless to say how attractive this is to energy companies like Chevron, who have already witnessed significant local resistance to fracking in Europe. The same could be said for attempts to limit the use of tar sands – the dirtiest fossil fuel in commercial production.
Under existing trade agreements in North America, a similar clause has already been used to challenge environmental policies. Under the North American Free Trade Agreement (NAFTA), the American company Lone Pine is suing Canada for Cdn$ 250 million after Québec introduced a precautionary moratorium on fracking in the St. Laurent River basin to allow a full environmental impact assessment.
An investor-state dispute settlement of any form is not needed in the EU-US trade deal and it would also constitute an unacceptable assault on democracy.
And if that's not enough there are even more reasons to be concerned about the TTIP negotiations. Large biotechnology and agricultural companies are very keen to see the European Union dismantle its foundational precautionary principle approach to regulation. This places the burden of proof on the safety of new products on the company, not, as in the US, on regulatory bodies. Through the TTIP, the EU's mandatory GM labelling law could be challenged, restrictions on the labeling of genetically modified (GMO) foods and hormone-treated beef could be undermined, and European GMO safety standards could be weakened.
If the EU and the US are serious about making the TTIP the reference for future trade agreements, they need to take the lead in developing policies that contribute to a fairer, greener and more sustainable trade agenda, without limiting states' sovereign rights to introduce and uphold new legislation. This not only means excluding an investor-state dispute settlement mechanism from the talks, but also prioritising the interests of people over corporations through sustainable, transparent, and accountable policy choices. This should start by putting an end to secrecy and releasing all the negotiation documents in order to enable genuine public debate on the kind of future we want.
Magda Stoczkiewicz is the Director of Friends of the Earth, Europe. She graduated from the Jagiellonian University in Krakow with a Master of Arts and is continuing with a postgraduate degree in public relations and European affairs.
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