EU investment proposal won’t prevent corporate attacks on health and environment

Report by Friends of the Earth Europe – Transnational Institute – Corporate Europe Observatory – Forum Umwelt und Entwicklung – Canadian Center for Policy Alternatives.

Dangerous attacks against regulations protecting the public interest and the environment would not be prevented by the European Commission’s new investment protection proposals for future trade agreements, according to a new report.

The report – developed by Friends of the Earth Europe, Transnational Institute, Corporate Europe Observatory, the Forum Umwelt und Entwicklung, and the Canadian Center for Policy Alternatives [1] – puts to the test the European Commission’s promise that the Investment Court System, its new framework for investment protection, will protect governments’ right to regulate [2].

Five iconic and controversial investor-state dispute settlements, where environmental and public health protections have been attacked, are reviewed through the lens of the Investment Court System, promoted during negotiations on a Transatlantic Trade and Investment Partnership (TTIP), the EU-Canada Comprehensive Trade and Economic Agreement (CETA), and the EU-Vietnam agreement. The report finds that all five disputes could still happen under the proposal, which falls short of safeguarding governments’ right to regulate.

Natacha Cingotti, trade campaigner at Friends of the Earth Europe, said: “The “Investment Court System” is nothing but smoke and mirrors. It further enshrines VIP rights for corporations and will expand the clout of private arbitration and its profiteers. Far from limiting attacks against public interest regulations, it will pave the way for many more”.

These cases include:

• Philip Morris vs Uruguay for the introduction of graphic warnings on cigarette packages and other tobacco control measures in order to promote public health;

• TransCanada vs USA for Obama’s decision to reject the Keystone XL pipeline as part of the US’ commitment to tackle climate change;

• Lone Pine vs Canada for a precautionary fracking moratorium enacted in Quebec;

• Vattenfall vs Germany for Hamburg city’s imposition of environmental standards for water use at a coal-fired power plant;

• Bilcon vs Canada for an environmental impact assessment that prevented the construction of a large quarry and marine terminal in an ecologically sensitive coastal area.

Cecilia Olivet, researcher at the Transnational Institute, said: “The European Commission has repeatedly said that it has listened to public concern and that its new Investment Court System (ICS) will prevent corporations’ blatant attacks on health, environment and democracy. Our study shows that this is patently false. We put ICS to the test and it fails on every count. Public resistance to TTIP won’t be bought off with sham reforms. We need a removal of ISDS provisions from any impending trade deal”.

The European Association of Judges and the Deutscher Richterbund have also criticised the “Investment Court System”, pointing to a potential lack of legal basis for its establishment and affirming that the provisions for the election, time of office and remuneration of the “judges” do not meet the minimum standards for judicial office [3].

If the European Commission is serious about its promise to protect citizens and the environment, it will put an end to private arbitration, starting with the removal of ISDS provisions – under whichever label – from the TTIP, CETA, and the EU-Vietnam trade agreements.

[1] The full report is available here

[2] http://trade.ec.europa.eu/doclib/press/index.cfm?id=1364 ;http://trade.ec.europa.eu/doclib/press/index.cfm?id=1468

[3] http://www.iaj-uim.org/iuw/wp-content/uploads/2015/11/EAJ-report-TIPP-Court-october.pdf ;http://www.drb.de/cms/fileadmin/docs/Stellungnahmen/2016/DRB_160201_Stn_Nr_04_Europaeisches_Investitionsgericht.pdf

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