[A2k] FT: Public backlash threatens EU trade deal with the US

Thiru Balasubramaniam thiru at keionline.org
Wed Jan 14 10:54:11 PST 2015

January 13, 2015 4:56 pm
Public backlash threatens EU trade deal with the US

Christian Oliver, Brussels

The EU has been hit by a stinging public backlash against its landmark trade
deal with the US
making it increasingly unlikely that the accord will be concluded this year.

Brussels last year launched a public consultation to gauge popular
sentiment about the most contentious part of the deal: clauses mapping out
the rights of foreign investors to sue governments in international
tribunals, bypassing national courts.

The European Commission received almost 150,000 responses to its survey —
more than 100 times more than any previous consultation on trade — and
admitted on Tuesday that the majority of respondents expressed fears that
the deal’s investment clauses would undermine national sovereignty.

The 28 EU nations want to conclude the Transatlantic Trade and Investment
<http://www.ft.com/cms/s/0/fe54facc-968b-11e4-a83c-00144feabdc0.html> this
year, finalising what would be the world’s biggest trade deal.“The
consultation clearly shows that there is huge scepticism against the
[investment] instrument,” said Cecilia Malmström, the EU trade commissioner.

But the so-called Investment State Dispute Settlement provisions are now
the biggest political obstacle to a deal, with activists arguing that they
could be used to undermine national safeguards on health, food and the
environment. Opposition is particularly strong in Germany, the EU’s most
powerful country.

Businesses argue that ISDS is vital to protecting investors against bias in
national courts.

Of the replies, a large number were based on copy-and-paste templates
circulated by non-governmental organisations campaigning against TTIP.
However, trade officials in Brussels said they would not discount these
submissions as they were still a sign of discontent.

Ms Malmström vowed a “frank discussion” on how to proceed with ISDS with EU
states, the European Parliament, businesses and NGOs. “The European
Commission would never even consider an agreement which would lower our
standards or limit our governments’ right to regulate,” she added.

Keith Taylor, a European parliamentarian representing the UK’s Green party,
said ISDS had to be dumped. “Investors should rely on domestic courts for
redress, not set up special tribunals,” he said.

However, ditching ISDS would be legally complex as Brussels has been
mandated to negotiate it into the deal by the 28 national governments.
There are also strong doubts about whether the US would support any deal
without it.

Instead, commission officials expect Ms Malmström to work towards a new
type of ISDS framework that addresses the concerns, setting out clear rules
on how international arbitrators would be appointed.

While anti-Americanism is surging in Germany because of US espionage in the
country, German companies have been active proponents of ISDS and the EU
has 1,400 bilateral ISDS

agreements. Rejecting ISDS completely would open up European countries to a
charge of double standards in that they are seeking to deny US companies
the same safeguards that their businesses enjoy.

EU trade officials also say European businesses want to ensure ISDS remains
in TTIP so that it is maintained as a standard feature for inclusion in any
agreement with China.

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