News / 05 Oct 2016
Go to newsThe European Left fights against the TTIP and the CETA, two sides of the same coin
The treaty with Canada[1] has become the priority of the foreign policy of the European Union. To accelerate its entry into force and to remove obstacles regarding its approval, the European Commission has proposed a series of measures to satisfy the demands of European Social Democracy. These measures include the following (in chronological order): modification of the structure of the protection system of foreign investors (ISDS [Investor-to-State Dispute Settlement] ICS [Investment court system]); inserting a mention of the "right to regulate" in the text of the treaty; proposal of CETA as a "mixed agreement" (waiting in any case of a pending decision of the CJEU [Court of Justice of the European Union]); proposal for a "Joint Declaration" to be adopted as an annex to CETA.
The Party of the European Left maintains the total opposition to the Treaty with Canada and noted that the changes and decisions adopted by the Commission are not sufficient in a double sense. First, they do not solve the democratic shortcomings of the negotiation, they do not prevent the undemocratic impact, contrary to the principle of subsidiarity of the intended procedure of provisional application, or avoid the limitations that the CETA represents to the right to decide and regulate of the Member States and citizenships. Secondly, the amendments and proposals of the Commission do not have sufficient authority to prevent the negative consequences on the rights of the social majorities and on the nature that the CETA will lead to. All this for the following reasons:
- Negotiation of CETA: opacity and contempt for the European Parliament, state parliaments and the opinion of citizens. The CETA negotiation has been a breakdown of the principles of transparency that are affirmed in existing EU procedures and a reduction of the power of the European Parliament to a minimum. On the one hand, the CETA has been negotiated with full opacity, without publishing the negotiating mandate and without a public debate. In fact, when the European Parliament adopted its resolution on CETA, there was no debate with civil society and no sufficient information about the agreement was provided. On the other hand, the CETA breaches the red lines that the Parliament itself approved regarding the TTIP[2], including the requirement to include a specific chapter for the protection of SMEs or limiting the extent of the ratchet clause.
- The CETA approval procedure: a "mixed treaty" that will be activated as a treaty of exclusive competence of the EU. The Commission has accompanied the CETA declaration as mixed treaty with a number of safeguard clauses that show its final desire to limit the capacity of decision of the state parliaments, acting at first as if it is a treaty of exclusive competence of the EU. In this regard, the Commission intends that the content of CETA is considered as an exclusive competence of the EU in order to impulse the Provisional Application for all the treaty. It should be clear that the content of the CETA comes neither entirely within the trade and investment policy nor within the exclusive competence of the EU. With this in mind, it should be noted that the mechanism of provisional application is a legally established way in the TFEU to allow the rapid entry into force of treaties with third countries, diminishing the safeguards that involves consideration of them as mixed treaties. It is a mechanism that legally cannot be used with respect to matters that are not the exclusive competence of the EU and politically it should not be used for an agreement like this, not even for those parts of CETA that are exclusive competence of the EU. The adopted provisional application, knowing that different parliaments have already positioned themselves against the agreement, infringes de facto the willingness of the Member States and the national and regional parliaments. If CETA is mixed and there are parliaments that have already opposed the CETA, the approval procedure of the treaty should not continue.
- Limiting the right to regulate: It is not enough just to affirm it when the text contains clauses that violate it. In the CETA there are mechanisms such as the negative list, the ratchet clause, the protection mechanism for foreign investment, the mechanisms for regulatory cooperation, that are "voluntary" but difficult not to apply, the need to justify the content of a particular regulation or the hindrances to the introduction of social or environmental protection clauses in public procurement procedures. All this limits the right to regulate of the Member States and their regional or local entities.
- The CETA as a living agreement with unpredictable consequences: it introduces a high number of ways for further development of its content through 9 "specialized committees" and a Joint Committee to allow that the CETA is like a "living agreement" of uncontrollable consequences.
- The lack of effective, binding and enforceable social clauses. The introduction of social clauses (like chapter 23 of the CETA) cannot prevent or moderate the negative effects. As with NAFTA (Free Trade North America), which included as a parallel treaty a social clause, the content of this clause has not prevented the negative consequences for labour rights and wage cuts. This is mainly due to the weak content of these clauses. They often use the ILO Conventions as enforceable standards even though, on the one hand some of the fundamental of them have not been ratified by states like the US and Canada and, on the other hand, the standards that these conventions include are minimum standards that should never be seen as optimum. Moreover, although Canada has taken steps in the adoption of new ILO Conventions to please the unions, the labour legislation continues to maintain standards below the EU average. In addition and as a final idea, it should be stressed that the control and sanction mechanisms that are associated to these clauses invariably provide less binding and much less severe consequences than those associated to the compliance by the parties of the agreements for trade or investment commitments.
- The involvement of public services by the negative list mechanism and its possible expansion. The exceptions established by the CETA. Thanks to the deregulatory potential of the negative list, the treaty has been a huge window for the Member States and their governments to eliminate protective standards of state services, covered by the obscurantism and opacity of the negotiations, restricting the political cost of the deregulation decisions that have been adopted and affect multiple sectors, such as education or health.
- The possible identical impact of ICS: Numerous reports have shown that the slight changes of the ICS regarding the ISDS do not solve most of the inherent risks of the private arbitration. The essential problems of the ISDS: the fact that a foreign investor has, by definition, more rights than a national investor; and the fact that States can be reported when they adopt democratically legitimate standards and that these complaints will not be cursed in ordinary courts, remain unchanged. Cases like Phillip Morris vs Uruguay, TransCanada vs the US, Lone Pine vs Canada, Vattenfall vs Germany and Bilcon vs Canada would have happen the same under the new system.
- The proposal of a commitment "Declaration" is a patch to allow the Social Democrats to vote for CETA limiting the political cost of his decision before facing elections in France and Germany. No statement even though purporting to be interpretative will have more value than the content of the agreement; it is a tactical decision without sufficient legal potential to prevent the negative consequences of the CETA. The only possibility to avoid the negative consequences of CETA is to reopen the negotiations, to start them with transparency and with the participation of the citizens, social movements and trade unions and the state and regional parliaments of the EU and Canada.
- We strongly oppose the treaties that contain mechanisms for the protection of specific foreign investment that constitute discrimination against state-owned enterprises and jeopardize the right to regulate and decide of democratic institutions, citizens and trade unions; we oppose agreements containing regulatory cooperation mechanisms that focus on rights like non-tariff barriers and establish mechanisms or bodies with the capacity to influence legislative powers and that integrate the lobbies in the antechambers of democratic decisions; we oppose the use of international treaties to deregulate services in particular through the mechanisms of negative lists, ratchet or standstill clauses.
- We denounce that the renunciation to maintain the objective of approving the TTIP in the coming months is a smokescreen to promote the CETA. The CETA approval would be actually a prelude to the TTIP. The degree of economic integration between the United States and Canada is very high as a result of a long previous experience of economic integration carried out by the CUSFTA (Canada-United States Free Trade Agreement, signed in 1987) and NAFTA. 81% of Canadian companies are linked as subsidiaries to companies of the United States, and in its market 42,000 companies of the United States are operating.
- The next meetings on October 18th and 21st are fundamental. The governments of the Member States must not betray their citizens by voting for an agreement that will lead to disastrous consequences. The October 27th summit with Canada should not be used to sign the CETA but to paralyze its approval procedure and reopen negotiations from the beginning.



