CETA deal could help investors attack public interest safeguards, new report finds

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A new report on the Comprehensive Economic Trade Agreement (CETA) between the EU and Canada reveals how the trade deal could make EU member states vulnerable to costly lawsuits from North American investors that threaten the public interest.

Corporate Europe Observatory, Friends of the Earth Europe, the European Public Services Union (EPSU) and twenty other European civil society organisations have published CETA – Trading Away Democracy a report which shows that the investment chapter of CETA remains a substantial threat to European democratic decision-making.

Once ratified, CETA will codify the right for Canadian investors – as well as US corporations with subsidiaries in Canada - to sue EU member states and European Union should they pass legislation which could negatively affect profits. CETA does not include any obligations for those investors.

Existing trade deals such the North American Free Trade Agreement (NAFTA) show that the majority of such cases are filed over laws protecting public health, the environment and labour rights, pitting corporate profits against the public interest.

As highlighted in the report, the investment chapter of CETA will lead to a boom in investor claims. These claims are to be decided in arbitration courts located outside the framework of national and European Union jurisdictions. This parallel justice system makes court proceedings expensive, untransparent and biased, which burdens public budgets and challenges democratic decision-making.

Despite wide-spread public mobilisation against key aspects of the agreement - notably its investment chapter - CETA is supposed to be signed before the end of this year.

Corporate Europe Observatory’s trade policy researcher and campaigner Lora Verheecke noted: “Our new report screens the European Commission promises meant to reassure citizens that CETA’s investment chapter is harmless. But despite the changes in the investment clauses, CETA still fails to protect the EU and member states from investors attacking public interest legislation.”

Paul de Clerck, economic justice programme coordinator at Friends of the Earth Europe said: “The Investment Court System is the worst part of recent trade deals as it undermines our democracy. If CETA is accepted, it opens the door for all Canadian companies and major US companies through their subsidiaries in Canada to sue European governments. We can expect a flood of new cases of investors attacking laws protecting public health, the environment and labour rights.”

Penny Clarke, deputy general secretary at the European Public Services Union, added: “It is not acceptable that public services like healthcare are liable to special investor courts when they exist first and foremost to serve the public. Ordinary people see that it is wrong to hand over to investors huge amounts of public money in these cases, why don’t more governments see it?”

You can read the full report here 

More demonstrations demanding to stop CETA are organised throughout Europe as part of this initiative (The heading is in French, but the body of the text is an English translation). See a video of one recent demo in Brussels, as well as photos