17 January 2017

12 reasons the Green/EFA Group is opposed to CETA

You’ve heard a lot recently about the EU-US deal TTIP, which we’ve raised as threat to ordinary people on both sides of the Atlantic. Well there’s another transatlantic deal which will soon be voted on in the European Parliament that raises similar concerns. The EU-Canada agreement 'CETA' is a different beast to TTIP, but its contents are just as concerning. Here are some reasons why we’re worried.

Simon McKeagney, Editor

1. Because transparency was worse than in TTIP

Public outcry about the secrecy surrounding TTIP forced the EU Commission to release previously classified documents and set up reading rooms for MEPs and national parliamentarians across Europe. While we think the Commission could do more in TTIP, none of this happened during the CETA negotiations. The dominance of corporate lobbying behind the scenes has skewed these deals in favour of the most powerful multinationals in the world even before the final text was eventually published. Secret deals are not good for democracy, CETA included.

2. Because private “courts” for investors undermine our democracies

Under pressure from the public in Europe, the Commission attempted to reform the controversial ISDS mechanism, that allow foreign investors to sue nations if they feel their businesses have been impacted by new laws or regulations. Yet despite Canada being the world’s most heavily-sued developed country in 2014, both sides agreed to include investor-rights under a new acronym called ICS or Investment Court System. Under ICS some procedural changes have been achieved, but make no mistake- ICS, just like ISDS, grants exclusive rights to foreign investors to sue countries, undermining our court systems in the EU and Canada. 

Report: New EU investment proposal will not prevent corporate attacks

3. Because we’re in unchartered territory with public services

For the first time the EU has negotiated a trade deal with a “negative list” for services. In short this means that unless European governments have explicitly excluded specific services, all services, including new public services in the future, will be automatically open to competition from foreign service providers. Jargon-filled mechanisms like “standstill” and “ratchet” clauses lock-in current and further liberalisation, making it very difficult (and costly) for countries to bring services back into public ownership.

Read: call to reject CETA by the European Federation of Public Service Unions.

4. Because Big Pharma got some sweet deals

EU pharmaceutical patent demands could add billions to Canadian provincial health care costs, after securing longer patent rights for drugs. According to the Council of the Canadians "It is estimated that changes to patent protection for pharmaceutical drugs in CETA could end up costing our public health care system anywhere between $850 million to $1.65 billion annually. This is up to 13 per cent of the total drug costs Canadians pay annually."

Deals like CETA also lock-in present rules for patents, making it difficult for European governments to consider shortening patent periods in the future to bring down healthcare costs for consumers. 

5. Because it pressures Europe to change it’s bio-technology and GMO rules 

Europe’s stance on genetically modified food has long been a point of contention for our friends across the Atlantic for many years, with US and Canada both taking cases against the EU in the WTO in the past. Canada is after all, the third largest producer of GMOs in the world.

Food Secure Canada notes that pro-CETA industry group CropLife Canada have celebrated CETA as it "establishes a biotechnology working group in order to shorten the timelines for the approval of genetically modified crops for cultivation in the EU, to strengthen ‘science-based’ regulation and to revise the ‘low-level presence’ policy for non-GMO imported commodities." While this does not undo European GMOs laws, CETA further contributes to the pro-GMO pressure on the EU regulatory processes.

6. Because what isn’t in the deal, is in the deal 

A surprise victim of CETA, which you won’t read in the text, is Europe’s own internal rules on the most polluting fossil fuels. The implementation of the Fuel Quality Directive (FQD), a crucial piece of law aimed at reducing the EU’s carbon emissions, was delayed for a number of years shortly after the CETA negotiations were launched in 2009. The FQD was supposed to give dirty tar sands a 20 percent higher carbon value than convention oil, but when it reappeared 5 years later, after CETA was approved, this provision had been watered-down significantly. Evidence suggests Canada lobbied hard to water-down the FQD, using CETA as leverage. This backroom bargaining on dirty tar sands shows the true nature of trade deals, and their role in sacrificing standards. 

7. Because undermining local economies isn’t progress

CETA attacks rules which aim to benefit local communities and municipalities. The EU successfully argued for the removal of Canadian buy local programs “that ensure local jobs” according to the Council of Canadians

Programs and laws that support local business have been on the target list for multinational companies in the past, and trade deals provide industry with the legal avenues to attack these national decisions. The Mesa Power Group, an energy company owned by Texas billionaire T. Boone Pickens, is claiming $775 million in a challenge to the province of Ontario's Green Energy Act, which gives preferential access to local wind farm operators, as one example.

Similarly, the EU Commission argues that such laws are discriminatory and act as “localisation barriers to trade.” But we believe efforts to support local businesses are essential for the creation of robust and vibrant local economies. 

8. Because public procurement isn't just about price

Local and national governments on both sides of the Atlantic use public tenders to fulfil public policy choices. That means companies bidding for public contracts must abide by agreed criteria that may include social, labour or environmental sustainability clauses. Yet CETA's Procurement Chapter fails to include any watertight clauses that uphold social criteria. Instead contracts can be awarded  to the "most beneficial" OR "the cheapest offer". The "most beneficial" doesn't necessarily require companies to consider ecological sustainability or other factors in the public interest.

CETA also curtails the future improvement of the EU's internal Procurement Directives by binding us to the current criteria in such international agreements. Local governments demanded during the last revision of the EU Procurement Directives that the thresholds for open bidding be lifted upwards, in order to have more freedom to grant tenders to local bidders. This was rejected by the Commission on the basis that international agreements had bound us to the existing thresholds. CETA, along with other deals, stunt our ability to redefine and enhance the tools we use to achieve important public policy goals.

9. Because it’s weak on environment and workers rights

Unlike the enforceable exclusive rights for investors, CETA includes no binding rules to protect and improve workers rights and environmental protection. The Confederation of German Trade Unions (DGB) criticised this, calling for “the chapters on workers’ rights, environmental protection and sustainable development to be designed as enforceable as the rest of the agreement” but the final text does not live up to these demands. 

10. Because local farmers will suffer 

A combined tonnage of 130,000 metric tons of beef and pork will be allowed to be exported from Canada to Europe under CETA. At a time when farmers are already being squeezed by lower prices, farmers is Ireland, France and Denmark are likely to suffer in particular. For Greens, we also question how possible it will be to ensure that only hormone-free beef will enter the EU market and how those controls will be carried out. The value of shipping tons of meat from one side of the planet to the other is also questionable.

11. Because we need to get real on climate change 

The landmark climate deal reached in Paris last year calls on governments to undertake huge changes to reach the target to cut global temperatures “well below” 2C.

Yet pro-industry provisions in deals like CETA curb the regulatory space for governments to act. In particular, recent ISDS cases involving Canada have shown that legislative decisions to protect the environment are being targeted by the fossil fuel industry. Oil pipeline firm TransCanada is seeking $15 billion dollars in US taxpayer compensation under the free trade deal NAFTA, following Obama’s decision to cancel the Keystone XL pipeline. Fossil Fuel companies have also sought compensation for fracking moratoria (Lone Pine vs Canada) and against planned provisions in Ontario’s Green Energy and Green Economy act (Mesa Power vs Canada 2011). 

Indeed, new research suggests that freezing new efforts to regulate is fast becoming the main aim of industry’s use of investor-rights clauses “where the purpose of a challenge is not so much to win the dispute or obtain compensation, as it is to deter further regulation.”

12. Because the dam breaks with ISDS cases 

While investor-rights provisions are not new, current treaties cover a mere one percent of US and Canadian investments in the EU. Only 8 EU member states have an ISDS mechanism with Canada, and only 9 Eastern European countries contain ISDS with the US. Under CETA, foreign investor-rights will be expanded tenfold. 81% of U.S. subsidiaries in the EU could launch ISDS attacks with CETA alone, according to US NGO Public Citizen. Despite this toxic mechanism having no discernible impact on FDI, and cases challenging public interest regulation are on the rise, tens of thousands of US and Canadian firms will be given new rights that ordinary businesses and individuals do not have. This will fundamentally alter the relationship foreign investors and multinational corporations have with our judicial systems and our democracies, for the worst.

Watch: Video on CETA from the Council of Canadians:


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Tony Wilson

Secrecy and haste are the opposite of democracy.


Can you also provide an overview of TISA?

Pauline McCullen

CETA is a 'Sneaky' Instrument and was quietly making its way into Europe To 'Keep People Under Foot' these past months. We really need to Rebel Against All of These Anti-Democratic Deals. Ever Our Own Government Is Not Listening.

Frans Geys

We won't accept dictatorship in the EU. With this kind of policy, you make the European citizen a EU-hater. WE ARE THE PEOPLE!

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