Stand Back, I'm About to Do Some Posting....

Apologies for the silence, I've been a bit busy, what with TTIP, ISDS, UK open standards, data retention, EU copyright review and much else.  But at least we had some great results, as the backlog of links to my posts elsewhere will show....

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TAFTA/TTIP: European Commission Tells Us to "Get the Facts"; Here They Are

Readers with long memories may recall in the dim and distant past that at one time "Get the Facts" was a favourite war-cry of Microsoft when attacking GNU/Linux and free software.  Of course the "facts" were anything but, and I spent quite some time debunking them.  Significantly, once the claims had been debunked often enough, and by enough people, the campaign went away, and was never heard of again.

Rather interestingly, the European Commission now seems intent on recapitulating that saga and its fate.  I've noticed several times recently it has invoked the "facts", and I've tried to show why its idea of facts leaves much to be desired.  So far, most of my columns about TAFTA/TTIP have been over on Computerworld UK, under the rubric "TTIP Update."  There also a fair few on Techdirt.  Here I'd like to address a rather interesting addition to the "Get the Facts" collection that doesn't really sit well in either publication, since it's in German.

It comes in response to an epetition from campact.de, that is currently storming away (at the time of writing it has nearly 300,000 signatures.)  Evidently worried by that momentum, the European Commission has issued another of its point-by-point commentaries.  I will repay the compliment by rebutting its rebuttals.  I'll use the original German, but you can use a Google Translate version if you wish.

Campact behauptet, dass TTIP es ausländischen Unternehmen zukünftig ermögliche, Gesetze in Europa auszuhöhlen. Falsch

Ein bereits bestehendes Gesetz kann nicht durch ein Handelsabkommen "ausgehöhlt" werden. So kann beispielsweise ein bestehendes Verbot von Fracking oder von Chlorhühnerfleisch nicht in Frage gestellt werden. Das einzige, was das Abkommen unterstreicht – und das ist auch im Interesse der EU – ist ein Diskriminierungsverbot. Das heißt: Was für Inländer gilt, muss auch für Ausländer gelten. Dies ist besonders wichtig bei Investitionen, die entscheidend für wirtschaftliche Entwicklung und die Schaffung von Arbeitsplätzen sind. Hier brauchen wir Stabilität und Sicherheit, auch für europäischen Investitionen im Ausland. Allerdings heißt Investitionsschutz nicht, den Unternehmen unbegrenzte Rechte einzugestehen, oder die Möglichkeit zu geben, jedwede nationale Gesetzgebung in Frage zu stellen. Investitionsschutzklauseln dürfen nur in sehr begrenzten Bereichen eingesetzt werden, z.B. wenn gegenüber inländischen Firmen diskriminiert wird oder wenn eine Firma im Ausland ohne Entschädigung enteignet wird.

Well, it's true that a trade agreement can't change laws directly.  But it can have a chilling effect, as occurred in Canada.  When NAFTA was brought in, practically every proposed law to protect the environment was dropped when threats were received from US companies that they would use investor-state dispute settlement (ISDS), available under NAFTA, to sue the Canadian government.  That's a real hollowing out of laws not just in the future, but also in the present, since governments will be unwilling to run the risk of getting sued if they apply them rigorously.

The Commission also claims that ISDS is particularly important for investment; but here's what its own site says on the subject:

Total US investment in the EU is three times higher than in all of Asia.

EU investment in the US is around eight times the amount of EU investment in India and China together.

EU and US investments are the real driver of the transatlantic relationship, contributing to growth and jobs on both sidesof the Atlantic. It is estimated that a third of the trade across the Atlantic actually consists of intra-company transfers.

That's all without ISDS: so why bring it in?

Campact behauptet, dass TTIP zu Privatisierungen im Bereich Wasserversorgung, Gesundheit und Bildung führe. Falsch.

Das TTIP-Abkommen hat nichts mit verordneten Privatisierungen zu tun – das wird von den Regierungen alleine beschlossen. Kein Freihandelsabkommen verpflichtet Mitgliedsstaaten zur Liberalisierung oder Privatisierung der Wasserversorgung oder anderer öffentlicher Dienstleistungen, z.B. des öffentlichen Gesundheitswesens, des öffentlichen Verkehrswesens oder des Bildungswesens.

Again, that misses the point, probably wilfully.  This is not about formally forcing these privatisations: but that will be the effect of ISDS, since governments will find themselves sued for billions of Euros if they don't allow commons to be privatised, since that would reduce expectations of future profits - a big no-no under ISDS.

Campact behauptet, dass TTIP die Tore für Fracking, Chlorhühnchen oder Genfood öffne. Falsch.

Fracking, Chlorhühnchen und Genfood sind in der EU verboten oder streng reguliert. Das wird auch ein Freihandelsabkommen nicht ändern. Nur Regierungen oder Parlamente können entscheiden, Gesetzgebung zu ändern. Die Europäische Union wird unsere hohen EU-Standards nicht zur Verhandlung stellen

Even if that's true - and since the negotiations are completely secret, we have no way of telling until it's too late - it's already become clear how cholorinated chickens and GMOs will be brought to Europe: the institution of a transatlantic Regulatory Council.  As I've already discussed at length elsewhere, this body will not only be able to veto new regulations unless they favour transatlantic trade, but they will be able to suggest to both EU and US lawmakers *directly* what new laws should be brought in - for example, those mandating that EU supermarkets must accept chickens washed in chlorine, or beef pumped up with growth hormones.

Campact behauptet, dass TTIP die Rechte von Internetnutzern einschränken werde. Falsch.

Sowohl die EU als auch die USA verfügen bereits über effiziente Vorschriften zum Schutz des Rechts des geistigen Eigentums, wenn auch der Weg zum Ziel gelegentlich unterschiedlich ist. TTIP soll den Handel zwischen der EU und den USA vereinfachen, ohne diese Vorschriften aufzuweichen. „ACTA durch die Hintertür“ wird es mit TTIP nicht geben.

Well, the protection of intellectual monopolies may be efficient, but that didn't stop the US and EU trying to ram through ACTA, did it? So what's to stop that now?  Claims that TAFTA/TTIP won't be ACTA through the backdoor ring a little hollow thanks to a recent leak that reveals what one of the EU's chief negotiators has to say on the subject of a "Christmas list of items" that lobbyists want in this area:

According to the negotiator, the most repeated request on the Christmas list was in "enforcement". Concerning this, companies had made requests to "improve and formalize" as well as for the authorities to "make statements". The Commission negotiator said that although joint 'enforcement statements' do not constitute "classical trade agreement language" -- a euphemism for things that do not belong in trade agreements -- the Commission still looks forward to "working in this area".

Sounds like ACTA through the back door to me...

Campact behauptet, dass TTIP undemokratisch sei und gewählte Politiker keine Einflussmöglichkeit hätten. Falsch.

Regierungen der Mitgliedstaaten, um sie vor, während und nach den Verhandlungsrunden „live“ über den Verhandlungsstand aufzuklären und deren Positionen zu einzubeziehen. Das Europäische Parlament wird ebenfalls regelmäßig über den Verhandlungsstand informiert, damit die Standpunkte und Interessen der demokratisch gewählten europäischen Abgeordneten in die Verhandlungen einfließen können. Am Ende sind es die EU-Mitgliedstaaten und das Europäische Parlament, die das letzte Wort über TTIP haben. 

So let's look at those claims.  It may well be that the Member States are kept informed - since they never pass on anything to their electorate, that hardly helps the public, say, who remain in the dark.  The European Parliament as a whole certainly isn't kept informed, even if one or two selected individuals are given information under embargo that they also cannot pass on.  And that "last word" that the European Parliament has over TTIP is all or nothing: as with ACTA, either it accepts the whole package, or it rejects the whole package.  That means it will be unable to remove the bad bits and keep the good bits.  By using emotional blackmail about the good bits, the European Commission will doubtless try to force through things like ISDS even though the European Parliament is increasingly alarmed about its dangers.

Worum soll es dann in diesem Handelsabkommen gehen?

Meistens verfolgen unsere Behörden auf beiden Seiten des Atlantiks im Grunde das gleiche Ziel, wenn sie Standards und Zulassungsverfahren festlegen: Sie wollen Menschen vor Risiken für ihre Gesundheit schützen, für Sicherheit etwa am Arbeitsplatz sorgen, die Umwelt schützen oder die finanzielle Sicherheit einer Firma garantieren. Um dies zu erreichen, haben wir auf beiden Seiten des Atlantiks aber häufig unterschiedliche regulatorische Strukturen und Traditionen. Daraus entstehen, obwohl das oft gar nicht beabsichtig ist, unterschiedliche Regelungen, die den Zugang zum anderen Markt oftmals erheblich erschweren. Schätzungen zufolge entsprechen aber allein diese bürokratischen Handelshürden einem Zoll von 10-20 Prozent.

Well, the aim may be the same, but the results are very different.  Here in Europe, we have the Precautionary Principle: that's not only absent in the US, but US industries have said many times that one of their *demands* for TAFTA/TTIP is that the Precautionary Principle should be dismantled.  Similarly, here in Europe we have the very strict REACH - Registration, Evaluation, Authorisation and Restriction of Chemicals.  Again, US industries haves aid they want to get rid of this "barrier" to their profits.

Equally, nobody would suggest that social, employment or environmental standards in the US are anywhere near as stringent as those in the EU: the idea that they are somehow "equivalent" is ridiculous, and shows that the true intent of the European Commission is to water down EU standards to US levels.

Warum das alles? Die transatlantische Handels- und Investitionspartnerschaft könnte wie ein Konjunkturpaket wirken: Das Abkommen könnte der EU einen Wachstumsschub von 0,5 Prozent des Bruttoinlandsprodukts erbringen, das sind rund 120 Milliarden Euro, oder 500 Euro pro Haushalt – denn letztendlich bedeuten Kosteneinsparungen für Unternehmen auch preiswertere Produkte, mehr Qualität und Auswahl.

What that fails to mention is that the 119 billion euro GDP uplift would only come in 2027, and is the *most optimistic* scenario, which assumes massive deregulation.  So it would not produce more quality, but US-style chlorine-washed chickens, hormone-injected beef and GMOs.

And the idea that every household would somehow magically receive 500 euros, as if from some TAFTA/TTIP Father Christmas, is just dishonest: even if this impossibly ambitiously deregulation were achieved, most of the GDP boost would go to the giant international companies, which would then doubtless offshore their profits, so you can forget about any "trickle-down" effect either.

Meanwhile, to pay for those boosted bottom lines, and billions in bonuses for corporate fat-cats, ordinary people would find their jobs disappearing overseas, their food quality lowered, and broader environmental degradation caused by widespread fracking and extractive industries indifferent to the damage they cause.  If anyone needs to get the facts, it's the European Commission.

ISDS: ACTA by the Back Door?

As I noted in my last TTIP update, things are beginning to get moving again on this front. One reflection of the growing interesting in this important trade and investment agreement was the public discussion entitled "Internet, Trade and Democracy: Transatlantic Relations under the Shadow of Surveillance", held in Berlin, and organised by Internet & Society Collaboratory and the blogger project FutureChallenges.org of the Bertelsmann Stiftung.

On Open Enterprise blog.

TTIP Update III

It's been fairly quiet on the TAFTA/TTIP front recently. That's largely because Europe shuts down for its summer hols during August, and has only just got going again. Unfortunately (for TAFTA/TTIP), the next round of negotiations has just been cancelled because the US administration was busy being, er, not busy. But as a consolation prize, we have a couple of documents from the European Commission on the subject of Investor-State Dispute Settlement (ISDS), which by a happy coincidence was the subject of my previous TTIP Update.

On Open Enterprise blog.

Canadian-Based Company Sues Canada Under NAFTA, Saying That Fracking Ban Takes Away Its Expected Profits

We've written several posts about a growing awareness of the dangers of investor-state dispute settlement (ISDS), which lets foreign companies sue entire countries for the alleged loss of future profits. One of the most egregious examples of ISDS concerns Canada, which is being sued by Eli Lilly & Co for $500 million after refusing to grant it a couple of pharma patents. Now The Huffington Post has details about another ISDS case involving Canada: 

On Techdirt.

TTIP Update I

At the start of this year I flagged up the likelihood that hugely important trade negotations between the EU and US would start in due course. A few months later, I gave some more background to that move, as well as the text of a document calling for the participants to avoid repeating the grave mistakes of ACTA, which ultimately led to that agreement being rejected in the European Parliament on July 4 last year.

On Open Enterprise blog.

Latin American Countries Band Together To Fight Growing Problem Of Investor-State Disputes

As Techdirt has observed, investor-state dispute resolution (ISDR) is turning into a major weapon that corporations can deploy against nations in order to claim damages for some alleged loss of future profits as a result of government action -- for example, stricter health or environmental regulations. Last year alone, 62 new investment arbitration cases were initiated against nations, and a record award of $1.77 billion was made against Ecuador. 

On Techdirt.

Eli Lilly Raises Stakes: Says Canada Now Owes It $500 Million For Not Granting A Patent It Wanted

A few months ago we wrote about the extraordinary -- and worrying -- case of Eli Lilly suing Canada after the latter had refused to grant a pharma patent. Eli Lilly's contention was that by failing to grant its patent (even if it didn't meet the criteria for a patent in Canada), Canada had "expropriated" Eli Lilly's property -- and that it should be paid $100 million as "compensation". 

On Techdirt.

People Begin To Wake Up To Massive Dangers Of Investor-State Dispute Resolution

Techdirt has been writing about investor-state dispute resolution (ISDR) mechanisms in international trade treaties like TPP and TAFTA/TTIP for two main reasons. First, because of the scale involved: ISDR allows companies to sue entire countries for huge sums, alleging loss of future profits. And secondly, because few seem aware of this growing threat to the national sovereignty of many countries around the world. That finally seems to be changing, with a number of articles warning about the dangers of ISDR appearing recently. 

On Techdirt.

EU Mandate For TAFTA Leaked: Includes Investor-State Dispute Resolution For Intellectual Monopolies

One of the concerns about TAFTA/TTIP is that it would repeat the mistakes of ACTA and SOPA as far as intellectual monopolies were concerned. This led to a call by a group of public interest organizations for things like copyright and patents to be excluded from TAFTA (disclosure: I was involved in the drawing up of the text.) Needless to say, no notice was taken of that, and a couple of weeks ago the European Parliament duly passed a resolution on TAFTA that said: 

On Techdirt.

How Investor-State Dispute Resolution Threatens Access To Medicines, And Much Else

A couple of weeks ago, we wrote about the growing importance of investor-state dispute resolution in so-called free trade agreements (FTAs). One of the most troubling aspects is how potentially it can be used to undo the hard-won gains for important areas like access to medicines. The US law professor Brook K. Baker, whose work we discussed last year, has written an excellent exploration of this under-appreciated risk. After an introduction running through the recent wins in the field of access to medicines -- a topic that we've covered extensively here on Techdirt -- he explains how big pharma could employ investor-state dispute resolution to thwart these and similar moves to protect health: 

On Techdirt.

Why has Monsanto "Quit" Europe? The Answer is ISDS in TAFTA/TTIP

The battle to bring GM food to Europe has been fiercely fought for years.  Most assumed it would be continue to rage for many more. Which makes this recent announcement extremely surprising:

The world's largest producer of seeds, Monsanto, has apparently given up on attempts to spread its genetically modified plant varieties in Europe. A German media report said the firm would end all lobbying for approval.

The German newspaper "taz" reported Friday that US agriculture behemoth Monsanto had dropped any plans to have farmers grow its genetically modified (GM) plant varieties in Europe.

Monsanto Europe spokesman Brandon Mitchener was quoted as saying the company would no longer engage in any lobbying fur such plants on the continent, adding that at the moment the firm was unwilling to apply for approval of any GM plants.

This is very curious.  Monsanto may be many things, but it is not a company that  gives up.  However, there is a clue in the last sentence of the above quotation: "at the moment the firm was unwilling to apply for approval of any GM plants". That suggests this is only a temporary halt, and that it will be back.

So why might it do that? Is there anything happening that might have triggered this move?

Why, yes: TAFTA/TTIP.  In fact, the issue of GM crops is likely to be one of the biggest sticking points.  The US side is insisting that "Sanitary and Phytosanitary" (SPS) measures must address GM foodstuffs, with the European side adamant that it won't drop its precautionary principle.

So how might that apparent contradiction be resolved?  A recent meeting on SPS gives a clue:

WTO members celebrated the 50th anniversary of 186-member Codex Alimentarius, which sets international standards for food safety, by calling, on 27–28 June 2013, for continued support for the body, and for trade measures to be based on science.

The calls came in a two-day meeting of the WTO’s Sanitary and Phytosanitary Measures (SPS) Committee, which consists of all 159 WTO members and deals with food safety and animal and plant health — measures having an increasing impact on trade. 

 Specifically:

“The increase in the number of SPS measures that are not based on international standards, guidelines and recommendations, or that lack scientific justification, is a point of concern that has often been raised by many members in the SPS Committee and other contexts,” Brazil observed.

The discussion of the six new specific trade concerns and the 10 previously raised and discussed in this meeting reflected that theme.

They covered; processed meat, genetically modified organisms (GMOs), restrictions related to the Japanese nuclear plant accident, orchid tissue culture plantlets in flasks, citrus fruits (a complaint by South Africa against the EU about black spot, which is the first dispute settlement case in the International Plant Protection Convention), offal, salmon, pesticide residues, sheepmeat, phthalates (materials added to plastics in food and drink containers) in wines and spirits, shrimp, mad cow disease (BSE), GMO pollen in honey, Indonesia’s port closures, and pine trees and other products.

As can be seen there, GMOs are mentioned twice.

Well, "trade measures to be based on science" sounds reasonable enough, doesn't it?  Except, as I've discussed at some length recently, the "science" actually means "scientists employed by companies"; that is, it is far from being independent or disinterested.  By redefining such company testing as "scientific", it can then be used to push through products that have never been tested by national food safety bodies.

This approach seems certain to crop up during the TAFTA/TTIP negotiations, and would offer Monsanto a fresh opportunity to push its GM products in the EU.  What it will be aiming for is that US "testing" must be accepted in the EU too - that's precisely what TAFTA/TTIP is all about - which would mean automatic approval for its products there.  Hence the recent pull-out - it won't even need to make applications in the future.

But it gets even better for Monsanto.  Another key area for TAFTA/TTIP is investor-state dispute settlement (ISDS).  Again, I've written extensively about this elsewhere. Here I just want to explore how Monsanto might use it to blackmail European governments into accepting GM crops.

Essentially, ISDS allows companies to sue entire countries or even regions like the EU for alleged loss of future profits (see this terrifying example from Canada.)  So once TAFTA/TTIP is signed with ISDS provisions, Monsanto will be able to threaten to sue the EU and its member states if they don't allow its GM products to be sold there.  

The logic would be that it invested money in Europe in the "reasonable" expectation - based on "science", of course - that it could sell its products as a result.  Since the EU authorities and national governments have proved so hostile to GM, it was unable to do that.  It would therefore claim that it could sue the EU for hundreds of millions - possibly billions - of  Euros for its "lost" profits.

This is not some mad fantasy: it is already playing out around the world, as governments find that they cannot apply laws designed to protect public health and safety, since they would have the knock-on effect of reducing some multinational's profits, and therefore makes them subject to ISDS claims.

I believe this is the main reason for Monsanto's temporary pull-out from the European approvals process: it feels confident that ISDS provisions will be included in TAFTA/TTIP - indeed, both the EU and US sides have said they want them - and equally confident that it will be able to sue the socks off the EU and national states if they don't simply wave through GM products in their markets, no further approval required....

What New-Style Trade Agreements Are Really About (Hint: It's Not Trade)

Given the massive impact that new-style trade agreements like TPP and TAFTA/TTIP are likely to have on the lives of hundreds of millions of people, it's surprising how few members of the public know about what's being negotiated in their name. Fortunately, publications are starting to run more articles on the subject, like this great piece by David Brodwin in US News. 

On Techdirt.

Investor-State Dispute Resolution: The Monster Lurking Inside Free Trade Agreements

We wrote recently about how multilateral trade agreements have become a convenient way to circumvent democratic decision making. One of the important features of such treaties is the inclusion of an investor-state dispute resolution mechanism, which Techdirt discussed last year. The Huffington Post has a great article about how this measure is almost certain to be part of the imminent TAFTA negotiations, as it already is for TPP, and why that is deeply problematic: 

On Techdirt.