Please make your comment after we make our decision

Taking a page from their United States counterparts, European Union trade negotiators apparently interpret the word “consultation” as a synonym for “ignore.” Fresh evidence for this attitude toward the public was provided thanks to a leak of the final text of the proposed “free trade” agreement between Canada and the EU.

Although the E.U. trade office, the European Commission Directorate General for Trade, promotes a process of public consultation on its web site, it isn’t the public who gets listened to. The final text of the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) includes language mirroring corporate wish lists unchanged from previous drafts despite the fact that the E.U. trade office has not had time to analyze comments submitted by the public.

This farce of a “consultation” process mirrors the secretive negotiations in the better known Trans-Pacific and Transatlantic trade agreements. Corporate lobbyists are well represented in these talks, but the public, watchdog groups and even parliamentarians and legislators are barred from seeing the text. The CETA text is also secret, but was leaked by the German television news program Tagesschau, which published the entire 521-page document on its web site. Yep, 521 pages.

The Rideau Canal in Ottawa (photo by John Talbot)

The Rideau Canal in Ottawa (photo by John Talbot)

Critical to understanding the CETA text is Section 33, the portion simply labeled “dispute settlement.” Under that bland heading a reader finds the muscle — what is known as an “investor-state dispute mechanism.” These “mechanisms,” found in many bilateral and multilateral trade deals, are corporate-dominated secret tribunals that hand down one-sided decisions with no oversight, no public notice and no appeals. Governments that agree to these mechanisms legally bind themselves to mandatory arbitration with “investors” in these secret tribunals on which most of the judges are corporate lawyers who represent the “investors” in other legal proceedings.

Kenneth Haar, a spokesman for the watchdog group Corporate Europe Observatory, in an interview with the EurActiv news site, called the dispute mechanism “an outright danger to democracy,” and said:

“The Commission is not really serious about its own consultation. It’s more about image than substance. … I think those who chose to respond to the Commission’s consultation are being ridiculed.”

Decisions will be final and unaccountable

Employing the standard sweeping language, CETA’s Article 14.2 (the articles here are numbered “14” even though they are found in Section 33) states: “[T]his Chapter applies to any dispute concerning the interpretation or application of the provisions of this Agreement” [page 472]. Article 14.10 goes on to declare, “The ruling of the arbitration panel shall be binding on the Parties. … The panel shall interpret the provisions referred to in Article 14.2 in accordance with customary rules of interpretation of public international law” [page 476].

“Customary” international law is whatever one of these secret tribunals says it is. Environmental regulations, “buy local” laws or any other government action that a corporation claims will hurt its profits can be, and frequently are, ruled illegal by these tribunals when adjudicating disputes under existing trade agreements. Such rulings set precedents that become “customary” international law.

In case these “customary” laws are not clear, on page 480 of the CETA text is Article 14.16, which would supersede national law:

“No Party may provide for a right of action under its domestic law against the other Party on the ground that a measure of the other Party is inconsistent with this Agreement.”

Your law was passed in a democratic process? Too bad — it will be overruled if an “investor” doesn’t like it.

CETA’s proposed rules are consistent with what is being secretly negotiated in the Transatlantic Trade and Investment Partnership between the U.S. and E.U., and in the Trans-Pacific Partnership being negotiated among 12 Pacific Rim countries. A majority of the world’s economy would be removed from any possibility of democratic control should these three trade deals come into effect.

The watchdog group Council of Canadians warns:

“The Harper government has thrown Canadian municipalities under the bus, forever banning ‘buy local’ and other sustainable purchasing policies that help create jobs, protect the environment and support local farmers and businesses. The Harper government has also agreed to lengthen patents and give new monopoly protections to already profitable brand name drug companies, which will needlessly add hundreds of millions to the cost of prescription drugs in Canada.”

Not even water would be exempt. If a water system is privatized and a local government chooses to re-municipalize it because rates have risen while service declines (as has routinely occurred on both sides of the Atlantic), the investor would be able to hold out for an extra windfall under the terms of the trade deal.

Only corporate lobbyists need apply

Although the public, and public-interest groups, are not heard, corporate lobbyists are. For example, there are 605 “advisers” with access to the text of the Trans-Pacific Partnership and who shape U.S. negotiating positions. Virtually every one is an executive of a multi-national corporation or a corporate lobbyist working for an industry association.

It is little different in Europe. Corporate Europe Observatory reports that 92 percent of the closed-doors meetings of the E.U. trade office have been with corporate lobbyists, while only four percent have been with public-interest groups. The trade office has gone so far as to actively solicit the involvement of corporate lobbyists. That perspectives other than those of multi-national capital are not considered can be inferred from the very way public input is solicited, the Observatory said:

“How would the average citizen respond to questions such as: ‘If you are concerned by barriers to investment, what are the estimated additional costs for your business (in percentage of the investment) resulting from the barriers?’ So, clearly, the close involvement of business lobbyists in drawing up the EU’s position for the [Transatlantic Trade and Investment Partnership] talks is a result of the privileged access granted to them.”

It’s no different for CETA, and the same dynamic exists across the Atlantic. Former U.S. Trade Representative Ron Kirk once admitted that if people knew what was in the Trans-Pacific Partnership, it would never pass. It is important to remember that these massive “free trade” deals are not simply business as usual — they go well beyond even the draconian rules of the North American Free Trade Agreement.

So although the competitive pressures of each country attempting to give an advantage to its multi-national corporations does mean that maneuvering through differing interests requires lengthy negotiations — not to mention the sometimes conflicting interests of various industries — at bottom there is a unifying class interest in the overall project. It is true that the U.S. adopts the hardest line in the trade negotiations it participates in (before we even get to the military muscle it applies to force open Southern countries), yet the absence of the U.S. from a Canada-European Union trade deal has made no practical difference to its outcome.

That different countries, different administrations, reach similar one-sided “free trade” agreements in which “investors” are allowed to overrule national laws, and labor, safety and environmental regulations are “harmonized” at the lowest level, is a product of capitalist competition. The rigors of that structural competition mandate expansion and growth — as local markets mature, capital has no choice, if it is to survive relentless pressure from competitors, other than opening new markets and relentlessly cutting costs to maintain profit levels. “Free trade” agreements represent one of the most effective ways to accomplish that.

Popular revolts against these agreements must be continued, and strengthened, but there will be no end to them as long as economic and social decisions are allowed to be made by “markets,” which are not disembodied entities sitting dispassionately on an Olympian throne but rather are the aggregate interests of the most powerful industrialists and financiers.


9 comments on “Please make your comment after we make our decision

  1. WrenchMonkey says:

    The financial or economic “industry” – a glaring oxymoron if ever there was one. Whilst one of the most harmful, it is nonetheless only a symptom of the ecocidal disease we call “civilisation“. On the bright side, it will probably be a primary causal agency in the collapse of it.

    Just my opinion

    • Just because it’s an “industry” doesn’t mean it’s useful …

      • WrenchMonkey says:

        Oh, it’s useful enough to those who control it.

        When enough people “believe” something, it becomes truth. Ergo, “money” – the ersatz commodity variety currently in use – is inherently “valuable“. Consequently, those who control vast quantities of this valued commodity, which in fact is utterly worthless, may use it to “buy” equally vast quantities of real commodities, resources that are essential to human survival.

        What’s that you say? You’re hungry and thirsty? We “own” all the food and water in the world. In fact, we own the very Earth in its entirety. Buy or Die.

        It’s so simple it’s almost elegant.

  2. It feels like we worked so hard to kill off the WTO, only to have an even worse monster spring up in its place.

  3. Peter Fuchs says:

    Hi, I tried to leave this comment on Znet, but it was never moderated there. So here I go again:

    Hi there, nice article – politically I totally agree. However, pls note, that the leaks on Tagesschau’s website comprise of over 1500 pages (including the important annexes;
    More importantly though: Pls note that section 33, which you are talking about, is NOT about Investor State Dispute Settlement. Your quotes from that section don’t say what you claim they say (regarding ‘investors’). That section is about the overall State-to-State Dispute Settlement Mechanism of CETA.
    For the dangerous Investor-State Dispute Settlement (ISDS)-rules you would have to look into Section 10 (Investment) (p. 148 ff.) and especially Section 6 (under 10) “Investor State Dispute Settlement) with paragraphs X. 17 onwards.
    This numbering will change again during legal scrubbing, the point is, you have to correct your facts/quotes. 😉 For example look at the dangerous provision for “Fair and Equitable Treatment” and the reference therein to ‘legitimate expectations’ of investors.
    P. Fuchs
    ( )

    • I think you are splitting hairs. The language quoted in Section 33 is standard language for these sorts of questions; even if it were true that this section “only” applies to state vs. state disputes, the states involved are acting on behalf of their “investors,” so it would amount to the same thing.

      Section 10, to which you refer, does go into far more detail on the specifics of what is covered (essentially everything), but uses the same language. That is a crucial part of the text, yes. Section 33 is also important because there the language specifies that national laws must conform the trade agreement text, and that removal of sovereignty is the mechanism that ensures corporate hegemony. The quotes and facts stand as correct.

      As a final point, I did know there was a separate 1,000-page annex; that the main text is itself more than 500 pages long is enough of an absurdity for a deal promoted as making trade “simpler.” The mind-numbing complexity is the point, not the specific number of pages. You are losing the forest for the trees: The article’s point is that CETA would be a anti-democratic disaster, not delineating what rule is in which section.

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