The European Commission Presents the Results of its Investment Protection Consultation
The European Commission published its analysis of the almost 150,000 replies to its online consultation on investment protection and investor-to-state dispute settlement (ISDS) in TTIP. Topics addressed included questions about safeguards on governments’ right to regulate in the public interest, full transparency of ISDS proceedings, ethical requirements for arbitrators, and a possible appeals body.
Commissioner Cecilia Malmström noted that there is significant skepticism in Europe about ISDS. Although the vast majority of replies were submitted through online platforms with pre-defined negative answers, the Commission also received individual replies from more than 3,000 individuals and some 450 organizations representing a wide spectrum of EU civil society, including NGOs, business organizations, trade unions, consumer groups, law firms, and academics.
ISDS is considered controversial because it allows investors to take governments to international arbitration tribunals rather than through the domestic court process. However ISDS does not give companies the right to limit governments’ right to regulate. As long as governments do not regulate in a discriminatory manner against a foreign investor in that country, ISDS will not allow companies to ask for compensation. And no ISDS settlement can force a government to change any regulation whatsoever. Moreover, ISDS are not often used in international trade: of the 3,236 bilateral investments agreements worldwide, less than 3% of those agreements have ever seen any action taken under ISDS. (EurActiv)
The Commission is set to reinvigorate its discussions on ISDS with member states (who unanimously asked for ISDS to be included in TTIP in the negotiating mandate), the European Parliament, and other organizations including NGOs, trade unions, and business associations. Commissioner Malmström underlined that the European Commission will only negotiate an agreement that is good for citizens, and would not lower the standards or limit governments’ right to regulate.
To read the entire press release – Click here
For the video of the press conference – Click here
To view the full Commission Staff Working Document on the Public Consultation – Click here
Speeches & Official Announcements
Commissioner for Trade Cecilia Malmström reacts to the public ISDS consultations
“The European Commission would never even consider an agreement which would lower our standards or limit our governments’ right to regulate.”- Commissioner Cecilia Malmström
Today, the European Commission published a report about the comments it received in response to a public online survey on investment protection and ISDS in TTIP. In reaction to the report, Cecilia Malmström, Commissioner for Trade, acknowledged that the public continues to have reservations about ISDS. To integrate these public concerns into the policy process, Commissioner Malmström announced a comprehensive round of discussions on investment protection and ISDS between the EU governments, the European Parliament, and civil society. Negotiations with the US will not begin until these discussions are completed and proposals from the public on how to improve investor protection and ISDS are implemented. Commissioner Malmström stressed that the EU Commission’s proposed TTIP agreement will benefit EU citizens by fostering growth, creating jobs, and protecting EU standards. (European Commission)
EU Parliament’s Committee on International Trade indicates resistance against ISDS
“A state-to-state dispute settlement system and the use of national courts are the most appropriate tools to address investment disputes.” – Bernd Lange, MEP; INTA Committee Chair
Bernd Lange, the European Parliament’s Committee Chairman, argues in a working document that a TTIP agreement could guarantee non-discriminatory treatment of foreign investors and dispute arbitration processes without implementing ISDS provisions. Furthermore, Lange contends that the ISDS provisions should only become part of TTIP, if there are “further reforms to the current model.” (EurActiv)
To read the Parliament’s working document in its entirety, please follow this link.
USTR addresses transparency of US trade policy
This USTR fact sheet explains how the current trade policy process informs the public, Congress, and important stakeholders on the progress and implications of potential trade agreements. In addition, the website details different ways that the public, Congress, and stakeholders can influence the formation and implementation of American trade policy. (United States Trade Representative)
News
German Agriculture Minister declares that food issues will not block EU-US trade deal
German Agriculture Minister Schmidt emphasized the positive impact that TTIP would have for Germany’s export-reliant economy in general and the agriculture sector specifically. The Minister is confident that the US will eventually agree to label products that include genetically modified organisms (GMOs) as part of the TTIP negotiations. In turn, Schmidt argues that food safety concerns will not block a TTIP agreement. (Reuters)
New Trade Subcommittee Chair Pat Tiberi is sworn in
Congressman Pat Tiberi (R-OH) will head the US House Ways and Means Committee Subcommittee on Trade in the new Congress. Tiberi will chair a committee that is expected to make progress on trade and tax reform because of the bipartisan support for both issues. The Republican from Ohio expressed support for reducing trade barriers: “As long as it’s done in a fair way, where we have the ability to open up markets, we have the ability to compete.” (The Columbus Dispatch)
UK Parliament committee will examine TTIP’s impact on European environmental protections
In a statement, Joan Walley, British Member of Parliament and chair of the Environmental Audit Committee (EAC), underlined that a TTIP agreement could be a boon for trade and investment in Britain. She cautioned, however, that a trade agreement must not result in weaker food and environmental regulations. Therefore, the EAC will investigate whether a TTIP agreement, which does not undermine EU environmental protections, is possible. (The Guardian)
Recent Analysis
All you need to know for the Latvian EU Presidency
TTIP has been the top priority for several European Council presidencies. With the Latvian EU Presidency beginning this month, we will hopefully start to see tangible progress in the talks, now that both parties are looking at the political elements of the deal. With the official publication of the ISDS report, we can expect a lot of discussion with member states and the European Parliament on this specific ISDS topic. Latvia’s Presidency is looking to make all possible efforts to see the deal concluded before the end of the year. (EU Trade Insights)
114th Congress: Let’s Get to Work
The Bipartisan Policy Center writes about the 10 most important issues to be tackled by the 114th Congress, underlining the need to set political differences aside to better confront these challenges. A list of “doable items” to be tackled by Congress on a bipartisan basis include the commitment to regular order, strengthening the economy, creating jobs, reducing federal deficit, fixing a broken immigration system, and bolstering US defenses against new threats online. Importantly, two key priorities are focused on trade: passing a robust Trade Promotion Authority bill and expediting exports of LNG to American allies. (Bipartisan Policy Center)
A day of reckoning for EU-US trade deal
More than 150,000 people have written into the European Commission to voice their concerns about ISDS. The Commission will now hold consultations with member states, the European Parliament, companies, and NGOs to decide how to proceed. While the Commission will certainly heed the voices of protest against ISDS, their most likely response will be the promise of a “state-of-the-art” ISDS that will address NGO concerns that reforms and modernizes the ISDS system setting a standard for future agreements. (Financial Times)
TTIP talks must stay on track
Former US Ambassador to the EU Stuart Eizenstat writes that transatlantic trade talks must not be sidelined by issues that could further complicate progress, such as the European competition case against Google. Statements by European antitrust enforcers or American pundits and members of Congress can be counterproductive, complicating negotiations to establish the world’s largest ever trade agreement. If negotiators can stay on track and focus on the issues that matter, building upon important shared transatlantic interest and values, US and EU leaders have a once-in-a-lifetime opportunity to raise standards of living, promote democracy, and foster global stability across the globe. (European Voice)
Trade winds buffet Digital Single Market
A raft of new rules designed to launch the Digital Single Market, set to be proposed and adopted this year by the European Commission, could be threatened by trade spats with the US. The EU is coming under pressure from US tech firms to include the free flow of data as part of TTIP. Various clauses within the proposed regulations would affect the larger US companies offering “over-the-top” data services and the burgeoning cloud computing system. The two sides must come together and find reasonable compromises on data privacy and information to move both processes forward. (EurActiv)
Saving TTIP by Learning from NAFTA
Christopher Sands states that instead of a NAFTA-like TTIP treaty, the Obama administration should seek an executive agreement with European leaders modeled from US negotiations with Canada and Mexico. Instead of a single undertaking in which nothing is decided until everything is decided, this would establish a new process by which future decisions can be taken cooperatively by governments, on a case-by-case basis. Under this model, some areas of TTIP cooperation would fall under EU competence while others would require the engagement of EU member states. (Atlantic Community)
Upcoming Events
Moving America Forward: a Focus on Economic Growth, 1st House Ways and Means Committee Hearing of the 114th Congress – January 13 in Washington – More Information
The Global Financial Crisis: Lessons from History – January 14 in Washington; hosted by the Brookings Institution – More Information
Economic Diplomacy: How Economic Ties Can Strengthen National Security – January 15 in Washington; hosted by the American Security Project – More Information
EU Rendez-Vous: TTIP and the Media: Perspectives from Both Sides of the Atlantic – January 15 in Washington; hosted by the EU Delegation to the US – More Information
The Eurozone: Now What? A Conversation with Lucrezia Reichlin – January 16 in Washington; hosted by The Brookings Institution – More Information
TTIP Town Hall: The Transatlantic Trade and Investment Partnership – Opportunities for Alabama – January 21 in Birmingham, AL; hosted by the Bertelsmann Foundation – More Information
The 2nd Annual EU-US Trade Conference: TTIP Where Now for the EU-US Trade Deal? – February 5 in Brussels; hosted by Forum Europe – More Information
Beyond Tariffs: Trade Relations and the Transatlantic Relationship in the 21st Century – February 6 in Washington; hosted by Georgetown University School of Foreign Service – More Information
February 2-6, 2015 – Eighth Round of TTIP Negotiations in Brussels – More information to follow