In the last TTIP update I wrote about two important leaks, both dealing with regulatory matters. One of those came from the Greens MEP Michel Reimon, and he's released another important document, this time concerning dispute settlement [.pdf]. Once more, it has been re-typed from the actual leaked document in order to minimise risk for the source (to whom thanks....)
It's an important chapter, since, as it says at the start:
The objective of this chapter is to establish an effective and efficient mechanism for avoiding and settling any dispute between the Parties concerning the interpretation and application of this Agreement with a view to arriving, where possible, at a mutually agreed solution.
That is, it covers the entire TTIP agreement, whatever that may turn out to contain. It describes in some detail how an arbitration panel consiting of three people will be used to resolve disputes regarding TTIP between the EU and US. Significantly, the proposed text says:
The ruling of the arbitration panel shall be unconditionally accepted by the Parties.
Here are the requirements for those arbitrators:
Arbitrators shall have specialised knowledge and experience of law and international trade. They shall be independent, serve in their individual capacities and not take instructions fro m any organisation or government, or be affiliated with the government of any of the Parties, and shall comply with the Code of Conduct set out in Annex II to this Agreement.
When it comes to the arbitration proceedings, which would take place in either Brussels or Washington:
Only the representatives and advisers of the Parties to the dispute may address the arbitration panel.
That is, there are no representatives of the public. However, the latter is graciously permitted to make written submissions to the arbitration panel:
Unless the Parties agree otherwise within three days of the date of the establishment of the arbitration panel, the arbitration panel may receive unsolicited written submissions from natural or legal persons established in the territory of a Party to the dispute who are independent from the governments of the Parties to the dispute, provided that they are made within 10 days of the date of the establishment of the arbitration panel, that they are concise and in no case lon ger than 15 pages typed at double space and that they are directly relevant to a factual or a legal issue under consideration by the arbitration panel.
Perhaps hoping to ward off any criticisms, the European Commission's proposal for dispute resolution includes the following in the remarks section:
This text for the dispute settlement chapter including the relevant annexes (Rules of Procedure, Code of Conduct and Mediation) is practically identical to all the texts for dispute settlement chapters (incl. its annexes) that the EU put forward in all recent bilateral negotiations of a trade agreement.
In other words, nothing to see here, move along please. And, indeed, the logic seems inarguable: trade agreements need dispute settlement procedures to sort out disagreements; this is what we've used innumerable times before; so no one can possibly object to using it again for TTIP. But here's the big problem with that syllogism: TTIP is not (just) a trade agreement.
The European Commission's own (hugely-optimistic) modelling of TTIP assumes that 80% of the benefits will flow not from pushing to zero all trade tariffs, of which there are few, but by removing "non-tariff barriers". And as I noted in my last column, those "non-tariff barriers" (NTB) are things like regulations and standards. They are essentially *cultural* expressions of a nation, and help to define what kind of society we want to live in by establishing what is protected, and to what extent.
So what the European Commission is proposing with the dispute resolution chapter is how future clashes with the US over those key social constructs should be resolved. And the answer is: by a three-person arbitration panel. That is, key aspects of everyday life - the social, environmental and safety protections that have been laid down over decades or more - can be thrown out purely on the say of those three people if it is decided that they clash with TTIP. And remember: "The ruling of the arbitration panel shall be unconditionally accepted by the Parties." So if, for whatever reason, the arbitration panel says a well-established regulation protecting health and safety, or the environment, has to go, well, it has to go, even if the vast majority of the public that it will effect disagrees.
This exposes the canker at the heart of the TTIP rose: it is applying trade policy instruments - and using the metric of profit - to core aspects of our lives that have nothing to do with either trade or money. This is why the European Commission's "ambitious" goal to eliminate the impossibly-high "25 per cent of NTB related costs" is fundamentally misguided, and profoundly wrong. By all means let us have a trade deal that allows both sides to buy and sell to each other without tariffs; by all means let us make standards compatible where it is simple and uncontroversial to do so; but do not use those aims to allow an unelected, supranational tribunal to make decisions, which cannot be appealed, affecting 800 million people, about cherished facets of our culture and daily lives.
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