December 30, 2013


The Next Corporate-Friendly Trade Pact : With the TPP facing Congressional scrutiny, the U.S. presses forward on another deal. (COLE STANGLER, 12/30/13, In These Times)

Much like the TPP, the TTIP isn't about eliminating traditional trade barriers such as tariffs. U.S. and EU tariffs already average less than 3 percent, some of the lowest in the world. Instead, the buzz phrase that TTIP advocates like to use is "regulatory harmonization." The U.S. Chamber of Commerce, for its part, calls for "regulatory coherence" and "regulatory cooperation." Essentially, it's all about better matching up U.S. and European regulations on a broad range of matters: financial services, environmental issues, labor relations, car safety, online data protections and even the chemical make-up of cosmetics--though it remains unclear what exactly would be covered in any final agreement.

On the face of it, standardizing regulations isn't inherently bad. The European Union, after all, has some of the most progressive regulations on the globe. But critics on both sides of the Atlantic are worried the agreement will eventually settle for the lowest common denominator--some kind of nightmarishly corporate-friendly mix of European financial regulations (there's no Dodd-Frank in the EU) and American regulations on the environment and food safety (the EU bans GMOs, hormone-treated beef and chlorine-washed poultry products).

While the secretive negotiations have left the details of "regulatory harmonization" up to the public's imagination, one indication of what it may actually entail came in a recent leak about the EU's desire to create a "Regulatory Cooperation Council." The hypothetical super-agency would be charged with evaluating existing regulations in both partners and coordinating any future rules, subjecting some to a "cost-benefit" analysis of their impact on trade. Under the proposal, the U.S. would be required to notify the special council of any upcoming regulations from federal agencies and allow the EU to comment. That would only further delay what's already a frustratingly slow federal rulemaking process, critics say.

Another potential TTIP provision that has critics alarmed is so-called "investor-state dispute settlement." Negotators on both sides are pushing for these corporate protections, which already exist in free trade agreements like NAFTA and many bilateral investment treaties. They allow corporations to sue governments in special third-party tribunals that have the ability to bypass domestic laws. That's how, for example, a Canadian mining company chartered in Delaware recently filed a lawsuit against the Canadian government after Quebec's 2011 ban on fracking in the bed of the St. Lawrence River nullified its mining permits.

The inclusion of "investor-state" provisions in TTIP is of particular concern because of how deeply integrated the EU and U.S. economies already are. Together they include 75,000 cross-registered firms, according to the consumer advocacy group Public Citizen. Critics warn that investor protections in TTIP could lead to a surge in lawsuits challenging basic public-interest regulations and create a hostile climate for regulators.     

Last week, a transatlantic coalition of labor unions, environmentalists and consumer protection groups sent a letter to the USTR and European Commission calling on the negotiators to drop investor-state dispute settlement from the trade talks.

"[Investor-state dispute settlement] is a one-way street by which corporations can challenge government policies, but neither governments nor individuals are granted any comparable rights to hold corporations accountable," the letter read.

Posted by at December 30, 2013 6:52 PM

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