08 January 2018
22 October 2017
UK and US Citizens: Please Request Your Personal Data Held By Cambridge Analytica
Because Cambridge Analytica is intimately bound up with the London-based company SCL it is possible to make a subject access request in order to find out what information is held about you. This applies to both UK and US citizens.
I therefore urge as many people as possible to ask for that data - it only takes a few minutes, and can be done with a simple letter. Obtaining this information will help us understand what exactly has been happening. Here's what I have sent; please feel free to use and/or modify it:
SCL Group Ltd
c/o Pkf Littlejohn 2nd Floor,
1 Westferry Circus,
Canary Wharf,
London,
United Kingdom, E14 4HD
22.10.17
Dear Sir,
Subject Access Request
I have read numerous reports in the press that you and/or your subsidiaries in the UK or elsewhere hold data on UK/US voters, which may include information about me.
In accordance with the UK Data Protection Act, I am writing to ask you to supply me with a copy of the information you hold about me, please.
If there is a fee or you require more information in order to fulfil my request, please let me know.
Thank you for your help.
Yours faithfully,
Glyn Moody
You may also wish to make a contribution to this crowdsourced initiative to dig even deeper. I've given, FWIW.
The stakes here are incredibly high: it is really no exaggeration to say that our democracy and freedom are at play. I therefore hope you can spare a few minutes to help shed some light on what has happened here.
Posted by Glyn Moody at 1:42 pm 0 comments
Labels: brexit, cambridge analytica, data protection, donald trump, elections, facebook, targeting, UK, us
31 May 2017
Urgent: Please Write to MEPs to Stop Awful Copyright Proposals
Today it was revealed that MEP Pascal Arimont from the European People’s Party (EPP) is trying to sabotage the Parliamentary process, going behind the negotiators of the political groups and pushing a text that would make the Commission’s original bad proposal look tame in comparison.
This is just a quick email to ask you not to support Pascal Arimont's proposed amendments to the copyright directive. Leaving aside the general issue that they would undermine the authority and role of the IMCO committee, they would cause huge harm to the Internet in Europe and to EU startups in that field.
The amendments to Article 13 are, despite claims to the contrary, incompatible with recent CJEU rulings, and go against the E-commerce directive that has served the EU so well over the years. The proposals would be costly to impossible to implement, and would see startups flee the EU for more hospitable investment environments.
Similarly, the amendments to Article 11 make a bad idea even worse by extending the duration of ancilllary copyright, and narrowing the exceptions. The experience in both Germany and Spain has demonstrated beyond doubt that publishers will be harmed by such a move, especially smaller ones. The proposed amendments will make the damage to both them and to the Internet itself even more serious.
I therefore urge you to reject all of Pascal Arimont's proposed amendments, and to support Catherine Stihler’s compromise amendments on the copyright file.
Posted by Glyn Moody at 2:35 pm 0 comments
18 May 2017
Tell the UK Government: No Backdoors in Crypto
I am writing in connection with UK government proposals to force tech companies and Internet providers to create government backdoors to encrypted communications.
Speaking as a journalist who has been writing about every aspect of computer technology for 35 years, and about the Internet for 20 years (https://en.wikipedia.org/wiki/Glyn_Moody), I cannot emphasise too strongly that this would be a very unwise and dangerous move.
There is no such thing as a safe backdoor that is only available to the authorities. If a weakness is created in a program or service, it can be found be third parties. That is hard, but not impossible, especially for well-funded state actors.
Even more likely is that details of backdoors will be leaked. The recent experience of the WannaCry ransomware attack, which is based on an NSA exploit that was leaked earlier, show how devastating this kind of subversion can be.
There is another powerful reason not to force companies operating in the UK to weaken their security. First, US companies may simply water down protections for UK users, while protecting those in the rest of the world. Obviously that would leave UK users particularly vulnerable to attack, and make them prime targets.
Secondly, if British companies are forced to provide backdoors in their products, then no government or company elsewhere in the world will use UK software, since there will always be a risk that it contains intentional security flaws. This is the surest way to sabotage the UK software industry, and to ensure that computer startups are located anywhere but in the UK.
As well as being harmful, moves to weaken the security of encrypted products are also unnecessary. As recent events have confirmed, terrorists rarely use encryption, and when they do, they make mistakes that allow the security services to access communications. Indeed, there are many ways to obtain access and information even when encryption is used, as a recent paper explained (https://www.schneier.com/blog/archives/2017/03/new_paper_on_en.html).
To summarise, the many and mighty harms caused by weakening encryption vastly outweigh any illusory benefits. The UK government would be ill-advised to take this route.
Posted by Glyn Moody at 5:33 pm 0 comments
Labels: backdoors, crypto, encryption, security
29 March 2017
The Copyright Industry's So-Called "Value Gap" Is Actually an Innovation Gap
There are three key areas in the proposed revision to the EU's Copyright Directive where the Internet and its users are under threat from attempts to strengthen copyright. First, there is the panorama exception, which allows people to take pictures in the street without needing to worry about whether buildings or public objects are subject to copyright. Despite this being little more than common sense – imagine having to check the legal status of everything in view before taking a photo – copyright maximalists are fighting to stop a panorama exception being added to EU law.
The second point of contention concerns the link tax, also known as the snippets or Google tax. The last of these explains the motivation: publishers want Google to pay for linking to their articles using snippets of text. Despite the obvious folly of charging for the ability to send traffic to your site, the copyright world's sense of entitlement is such that two countries have already introduced a link tax, with uniformly disastrous results.
When Spain brought in a law that required search engines to pay publishers for the use of snippets, Google decided to close down its Google News service in the country, which led to online publishers losing 10% to 15% of their traffic.
Similarly, in Germany, which also introduced a link tax, publishers ending up giving Google a free licence to their material, so great was the law's negative impact on their business when Google stopped linking to their publications.
The snippet tax is so manifestly stupid that it is unlikely to appear in the final version of the revised Copyright Directive. But the third area of concern stands a much better chance because of the clever way that the publishing world is dressing it up as being about a so-called "value gap." It's a very vague concept – see this new video that explores what it is - but it boils down to publishers being resentful because digital newcomers came up with innovative business models based around legal access to online music, and they didn't.
An interesting speech on the topic by the International Federation of the Phonographic Industry's CEO in 2016 laments the fact that the "value" of the global music industry has recently declined 36% over 15 years. That's not really surprising: during this period the recording industry did everything in its power to throttle or stall new ways of providing access to music on the Internet.
What the so-called "value gap" is really about here is the long-standing innovation gap among recording companies, and their refusal to adapt to a changing world. Imagine if they had embraced the P2P music sharing service Napster in 2000 instead of suing it into the ground. Imagine if they had set up sharing and streaming servers themselves a decade and a half ago; imagine how much money they would have made from subscriptions and advertising, and how much their value would have grown, not fallen.
If this evident innovation gap only harmed the copyright companies themselves, it would not be a problem, so much as just deserts. But they are now lobbying to get the laws around the world changed in important ways purely in order to prop up their old business models in an attempt to compensate for this failure to embrace the Internet. In the EU, they are using the fallacious "value gap" concept to call for mandatory upload filters for all major sharing sites – effectively large-scale surveillance and censorship.
Given that one of the most important consequences of the Copyright Directive could be the curtailing of basic human rights in the EU, it is disappointing that a seminar run by the Alliance of Liberals and Democrats for Europe (ALDE) group in the European Parliament – supposedly made up of liberals in favour of such democratic freedoms – skews the debate so completely in favour of the copyright industry. Judging by the programme, there is not a single representative of the public speaking at the event – which is pointedly entitled "Copyright reform: Sharing of the value in the digital environment" - pretty much guaranteeing a biased and unhelpful discussion.
That failure by ALDE even to acknowledge that EU citizens have anything useful to contribute, or any right to speak here, does not bode well for the ultimate outcome of the Copyright Directive negotiations later this year. ALDE needs to start caring about and listening to the millions of citizens who voted for its MEPs. At the moment it seems to have uncritically swallowed the backward-looking copyright industry's framing of the problem as a non-existent "value gap", when the deeper problem is its continuing innovation gap. As a result, this year could see key aspects of the Internet's operation, to say nothing of privacy and freedom of speech, gravely damaged because of yet another expansion of copyright's reach and power.
Posted by Glyn Moody at 12:56 pm 0 comments
Labels: alde, censorship, copyright, eu, germany, google, innovation, link tax, music, napster, spain, surveillance, value gap
11 February 2017
Please Write to Your MEPs About Next Week's Critical - and Final - CETA Vote
But there is still a chance to stop it in the European Parliament by writing to your MEP, and asking them to vote against ratification next week. You can contact your MEP using the wonderful free service WriteToThem. Here's what I've sent to mine:
I am writing to you to ask you to vote against CETA ratification next week, because it has minimal benefits, and a great many risks that have not been estimated, but are likely to be large.
Despite vague claims to the contrary, CETA offers almost no benefits for the EU. According to the joint study commissioned by the EU and Canada (http://trade.ec.europa.eu/doclib/docs/2008/october/tradoc_141032.pdf): "The annual real income gain by the year 2014, compared to the baseline scenario, would be approximately €11.6 billion for the EU (representing 0.08% of EU GDP)".
The study's title is "Assessing the costs and benefits of a closer EU-Canada economic partnership", but it offers no formal estimate of the costs associated with CETA. This is an extraordinary deficiency: even the smallest business would carefully weigh up the costs and the benefits before agreeing a deal. And yet the European Parliament is being asked to ratify CETA without being told the true costs.
These are likely to be high in many areas. For example, the "new" Investment Court System (ICS) will open up the EU to being sued by thousands of US companies that have subsidiaries in Canada. For most member states, this will be the first time that US companies are able to use investor-state dispute settlement (ISDS) tribunals to claim millions – or even billions – of euros over laws and regulations which they claim harms their investments. ISDS claims alone could wipe out the tiny €11.6 billion GDP gain that CETA is predicted to produce according to the official study.
Despite the fact that ICS is supposed to address the avowed problems with the current ISDS system, it actually fails to do this because it still gives companies a means to put pressure on governments to rescind laws, even if it cannot force them to do so. Faced with potentially huge fines – one ISDS award was for $50 billion (http://www.shearman.com/en/services/practices/international-arbitration/yukos-arbitral-award) – governments are very likely to choose to withdraw regulations rather than pay out such vast sums.
It is also worth bearing in mind that a 2014 EU consultation on ISDS drew an unprecedented 145,000 negative responses calling for the system to be dropped from trade agreements (http://trade.ec.europa.eu/doclib/press/index.cfm?id=1234&title=Report-presented-today-Consultation-on-investment-protection-in-EU-US-trade-talks). Making a few cosmetic changes and re-branding ISDS as ICS rides roughshod over the public's views on this important matter. Moreover, there is no reason to include ISDS/ICS at all. Canada's legal system is one of the fairest in the world, and so providing companies with additional privileges not available to governments or the public is simply unjustified.
There are further, more subtle problems with CETA. For example, the regulatory chapter stipulates that parties have to ensure "that licensing and qualification procedures are as simple as possible and do not unduly complicate or delay the supply of a service or the pursuit of any other economic activity" (Article 12.3). It is easy to foresee companies challenging requirements for public input, environmental assessments and archaeological studies as not being "as simple as possible". Rather than face costly legal challenges, local authorities are likely to drop these important aspects of regulatory approval, resulting in a general lowering of standards as "economic activity" is placed above all other considerations.
More generally, CETA does not protect the environment as is sometimes claimed. CETA’s environmental provisions cannot be enforced through trade sanctions or financial penalties if they are violated. Something that cannot be enforced may possess symbolic – or marketing – value, but is of little practical use when it comes to protecting the environment. This is another way in which CETA's true costs are being masked by exaggerated claims about its benefits.
Taken together with the fact that even the official econometric study was able to find only vanishingly small economic benefits, these many hidden problems and their unquantified costs underline why CETA is a bad deal for the environment, a bad deal for the public and a bad deal for the EU. Even if its supporters claim otherwise, without any justification, I urge you and your colleagues in the European Parliament to vote against its ratification.
Posted by Glyn Moody at 3:06 pm 0 comments
Labels: canada, ceta, environment, ICS, isds, meps, regulations
11 January 2017
Please Write to MEPs on the ENVI Committee About CETA *Today*
I am writing to you in connection with the ENVI vote on CETA tomorrow. I would like to urge you to support the draft opinion of the ENVI committee, given by rapporteur, Bart Staes.
As a journalist, I have been writing about CETA since 2012 (https://www.techdirt.com/articles/20120709/07420719630/actas-back-european-commission-trying-to-sneak-worst-parts-using-canada-eu-trade-agreement-as-trojan-horse.shtml), and have followed its long and complicated history closely. I noted in 2015 that CETA has already harmed the EU's environmental policies (http://arstechnica.co.uk/tech-policy/2015/05/eu-dropped-plans-for-safer-pesticides-because-of-ttip-and-pressure-from-us/):
"One of Canada's key negotiating aims was to promote the use of its tar sands in Europe. In 2012, the EU's Fuel Quality Directive (FQD) proposed that tar sands should be given a 20 percent higher carbon value than conventional oil. This reflected the greater pollution caused by its production and was designed to steer companies away from using this particular form of fuel in the EU. However, a few weeks after CETA was concluded, the final version of the FQD had been watered down and lacked the earlier requirement that companies needed to account for the higher emissions from tar sands, effectively neutering it—exactly as Canada had demanded."
Environmental policies will be under attack thanks to the little-known requirement in CETA that parties have to ensure "that licensing and qualification procedures are as simple as possible and do not unduly complicate or delay the supply of a service or the pursuit of any other economic activity." It is easy to foresee company lawyers arguing that environmental requirements go beyond "as simple as possible", and that they "complicate or delay" the supply of a service.
However, the greatest threat to the EU's environment comes from the investor-state dispute settlement mechanism, now re-branded as the Investment Court System. Despite the change of name, and some minor tweaking of the process, the problem remains the same: foreign investors are given unique powers, not available to domestic investors, that place them above national and European law.
That's problematic enough in itself, but even more troubling is the fact that the area where ISDS/ICS has been used most is against environmental legislation. Also worth remembering is that CETA allows non-Canadian companies that have operations in Canada to take advantage of this supranational right: that will enable thousands of US companies that have subsidiaries in Canada to sue the EU.
Finally, it's worth noting that the EU's official economic modelling of CETA finds tiny benefits: €11.6 billion, representing 0.08 percent of EU GDP (http://trade.ec.europa.eu/doclib/docs/2008/october/tradoc_141032.pdf.) That gain could easily be swamped by a flood of ISDS/ICS suits demanding "compensation" for stringent environmental regulations.
Because of these threats, and the vanishingly small benefit that CETA is expected to bring, I urge you to support the ENVI rapporteur's draft opinion, and to encourage your colleagues to do the same.
Posted by Glyn Moody at 11:41 am 0 comments
04 January 2017
Spare Slots for Regular Freelance Work Soon Available
Posted by Glyn Moody at 11:45 am 0 comments
Labels: china, copyright, digital rights, europe, free software, freelance, journalism, linux, open access, open source
17 December 2016
Please Write to Your MPs Asking Them To Support Fossil Fuel Divestment
Trump has surrounded himself with more oil industry and oil industry connected people than any president in history (even George W. Bush). You can’t understand what’s going on with Trump unless you understand the oil industry… and you can’t understand the oil industry without understanding climate change.
That's the bad news. The good news is that we can fight this in a way that neither Trump nor the fossil fuel industry can block. Given that it is unlikely that any progress in tackling climate change will be made on the political front, with the US blocking thwarting everything it can, we must turn to economics using divestment from fossil fuels as our main approach.
This is already happening on a massive scale, even if most people are unaware of that fact:
The value of investment funds committed to selling off fossil fuel assets has jumped to $5.2tn, doubling in just over a year.
The new total, published on Monday, was welcomed by the UN secretary general, Ban Ki-moon, who said: “It’s clear the transition to a clean energy future is inevitable, beneficial and well underway, and that investors have a key role to play.”
We must do everything in our power to accelerate that move away from fossil fuels. Once the business world gets the message that investing in fossil fuels is not just a bad idea, but potentially disastrous, the shift to renewable energy will happen rapidly, regardless of what Trump does.
Here in the UK, there's an opportunity to encourage a key group of decision makers to tell their pension fund to divest from fossil fuels: MPs. In fact, there's an entire campaign to encourage them. If you are a UK citizen, I would like to urge you to contact your MP asking them to support this campaign.
You can either do this using the link above, or directly using the indispensable WriteToThem site. Here's what I've just sent my MP:
I am writing to ask you to support a call for the MPs' pension fund to divest from fossil fuels (details here: http://gofossilfree.org/uk/divest-parliament/). There are two main reasons for this.
The first is that it is clear that climate change is the greatest threat we face – not just because of its direct effects on the environment, but also because of the knock-on effects – for example in creating millions of climate refugees, or threatening the world's food supplies.
Confronted by an incoming US administration that is the most environmentally-hostile ever, it is clear we cannot expect the US to lead here – indeed, it seems likely actively to obstruct efforts to address climate change through international agreements.
Divestment from fossil fuels is the most effective way to counter that threat, since it is something we can all do, both as individuals and as groups. The net effect is to divert investment away from the technologies that are exacerbating the problem of global warming, towards those that help solve it, creating new jobs in the process.
Fossil fuel divestment is already taking place on a massive scale: a report published last week now puts the figure at $5 trillion (https://www.theguardian.com/environment/2016/dec/12/fossil-fuel-divestment-funds-double-5tn-in-a-year). If the MPs' own pension fund divested, this would both strengthen that movement and set a good example for others to follow.
The other reason why I would urge you to support divestment is that the "carbon bubble" is likely to burst soon, and will take with it any pensions that still have large-scale investments in fossil fuels. No less a person than Mark Carney warned of this last year (https://www.ft.com/content/622de3da-66e6-11e5-97d0-1456a776a4f5), so this is by no means some fringe idea, but mainstream and increasingly accepted.
I hope you agree that for the sake of this and future generations, we must move as rapidly as possible to embrace renewable energy, and that an effective way of accelerating that shift is to divest from fossil fuels.
Thank you for your help in this important matter.
Posted by Glyn Moody at 2:51 pm 0 comments
Labels: climate change, divestment, donald trump, environment, fossil fuels, MPs
24 April 2016
TTIP Is Dying; Here's How to Help Finish It Off
According to the research, "In the United States [today], opinion is split, with 15 percent in favour [of TTIP] and 18 percent against." In 2014, 53 percent of Americans were in favour, and 20 percent were against TTIP. In Germany today, "33 percent have a negative opinion of TTIP, with only 17 percent considering it a good thing." Two years ago, 55 percent of Germans were in favour, with 25 percent against.
There are no comparable figures for the UK, but they probably wouldn't be as good: the almost total lack of media coverage on TTIP and CETA might make cynics suspect a conspiracy, and many people in the UK have never heard of it. If asked, they would probably say they were in favour of a trade deal with the US - indeed, some surveys carried out for the European Commission ask precisely that question, and get generally favourable answers. That's not surprising, since the problem is not so much with US trade deals in general as TTIP in particular: when people find out exactly what is in TTIP they are generally pretty appalled at what is being done in their name.
Given the reluctance of mainstream media to provide objective information - if any - there's not much we can do other than post to social media. One other thing we Europeans can all do is to contact our politicians expressing our concerns, and asking them some questions about their knowledge and support or otherwise for TTIP.
Linda Kaucher, the main organiser of the Stop TTIP movement in the UK, has put together a useful sample letter for UK citizens to send to their MPs to do precisely that. It could easily be modified for other EU countries. Ideally, you could take the letter and edit it to make it more personal, but the most important thing is to send it to your political representatives so that they appreciate the strength of public opinion on the topic of TTIP and CETA. Here's the letter:
Dear [politician],
I have these concerns and questions about the EU so-called ‘trade’ agreements and I would appreciate a response at your earliest convenience.
The US/EU TTIP (Transatlantic Trade and Investment Partnership) is of huge public concern as it is clearly for the benefit of transnational corporations while it threatens our health and safety standards, our public services (despite attempted ‘reassurances’), and our democracy and sovereignty.
Investor State Dispute Settlement (ISDS) and the Trade Commission’s latest version of this, Investment Court System (ICS) will give rights to transnational and foreign corporations to sue EU governments, thus threatening regulation in the EU and in the UK. The planned Regulatory Cooperation Body, by any name, will be supranational, assessing all regulation, existing and future, on criteria of ‘trade’ rather than social values, with big business input from both sides of the Atlantic from the earliest stages.
Of immediate concern is the EU/Canada CETA (Comprehensive Economic and Trade Agreement). It has many of the same components as TTIP and is in some aspects even worse eg 100% negative listing of services. It is very much a ‘back door’ for TTIP, both as a model for such deals and in allowing US corporations to utilise ISDS (ICS) against EU governments, including our own, via their Canadian subsidiaries.
Supposed economic ‘gains‘ for both TTIP and CETA , even according to the official studies, have been exposed as minimal and it is indicative that the European Commission no longer refers to them – so, no ‘jobs and growth‘ after all.
These trade agreements should be blocked and the UK government can do this in the European Council. Will you urge the Cameron government to do this?
In addition to these concerns about these agreements, I have these questions and requests about process:
It appears from the UK parliamentary procedures that the UK has denied itself any veto with regard to trade deals, even though other member state parliaments have this power. Is this the case, and if so will you initiate action to change this?
The problem remains that our MPs still have no access to key TTIP documents, whereas members of other EU parliaments do. Will you ask a parliamentary question on why UK MPs still have no access to key TTIP documents?
In the CETA text we have no UK protection for Geographical Indicators (regional food names), whereas other member states do. Will you ask a PQ on why the UK government has failed to seek any GI protection in CETA and call on the UK government to block the completed CETA agreement on this basis?
Even if CETA and TTIP are 'mixed deals’ they would be ‘provisionally implemented’ by the Commission, with ISDS obligations legally in force from that point, before any parliamentary discussion here and there are no procedures to reverse this. This procedure, particularly combined with a lack of UK veto, makes the UK ratification process irrelevant. Will you call on the UK government to block TTIP and CETA in the EU Council, for this additional reason?
There is no analysis of the 1600 page CETA text, as a basis for either the European Parliament or the UK parliament to ratify this agreement. It should therefore not be ratified. Will you call for CETA to be blocked in the Council for this reason also?
I look forward to your response
Me too.
Posted by Glyn Moody at 1:34 pm 0 comments
Labels: ceta, eu, european commission, european parliament, ICS, isds, meps, MPs, tisa, TTIP
06 March 2016
Please Write To MPs To Call For More Time To Debate Investigatory Powers Bill
This is just a quick note to ask you to support efforts to allow more Parliamentary scrutiny for the Investigatory Powers Bill. Although views may differ on the contents of the Bill, surely everyone can agree that something as important and as complex as this deserve rigorous examination by MPs.
As a journalist, I have looked through the Bill and several of the Codes of Practice, so I know from first-hand experience how much is contained in the 800 pages they represent in total. With only a cursory examination by MPs, it is highly likely that there will be aspects that could cause huge problems later on – for the intelligence services and police, the public, UK computer companies and specific groups like journalists, lawyers and MPs.
I therefore urge you to join with your colleagues to ask the government to allocate more time for the Bill to be discussed. The fact that there is a sunset clause in the Data Retention and Investigatory Powers Act is not a good reason to rush through a flawed Investigatory Powers Bill to replace it.
Posted by Glyn Moody at 3:16 pm 0 comments
Labels: investigatory powers bill, IPBill, MPs, snooper's charter, surveillance
02 January 2016
TTIP Update LI
"If we're going to go down this road, we want to get it on one tank of gas," [chief US negotiator] Froman said earlier this year.
For now, one tank of gas for both sides means reaching a deal before the current European Commission, the executive branch of the EU, finishes its term at the end of 2014.
That deadline has come and gone, and even end of 2015 is looking unrealistic. That's serious, because in 2016, the political madness that is the US Presidential race begins - and Obama will not want to have to force through an increasingly unpopular trade agreement and thus blight the chances of whoever the Democrat's candidate turns out to be. That's become an even more important concern in the wake of introduction of the US Trade Promotion Authority bill, also known as "Fast Track" a couple of weeks ago.
Fast Track essentially gives Obama full authority to negotiate trade agreements like TTIP and its sister treaty, the TransPacific Partnership agreement (TPP), with only a single, yes or no vote at the end of the process. This is exactly what happens here in the EU, where the European Commission has the authority to negotiate trade agreements, which are then presented to the European Parliament for ratification.
The big problem - for the public, at least - is that not a single comma can be changed at this stage: it's a classic take it or leave offer. This is a kind of political blackmail, since MEPs will be unwilling to be seen to reject a package that might contain some good measures - for example, potentially boosting employment - because it also contains bad things like the investor-state dispute settlement (ISDS). The hope - of both the European Commission and Obama - is that lawmakers will simply swallow the bad bits in order to keep the good bits.
But politicians are now much more aware of how unsatisfactory this blackmail is, and are trying to avoid getting into that situation. Some, like Senator Ron Wyden, who is co-sponsor of the Trade Authority bill, want to place certain conditions on the granting of fast track authority so as to make the final agreement as acceptable as possible. But many others, both Democrats and Republicans, are unwilling to grant Obama the trade authority at all, albeit for different reasons. The Democrats are concerned about the bad things in TPP, whereas the Republicans simply don't want to give extra powers to their ideological enemy, Obama.
Whatever the reason for their revolt, US politicians are not lining up to support the Trade Promotion Authority, and it seems that its passage hangs in the balance, with its chances shifting on an almost daily basis. That has huge implications for TTIP as well as TPP. If Obama is unable to obtain fast track, it's quite possible that TPP will collapse, since the other nations involved will be unwilling to make their best offers since the US cannot guarantee that its politicians won't try to alter the "final" text of the agreement.
The same applies to TTIP. If Obama fails to secure Trade Promotion Authority, all of the US offers to the EU will be provisional, since the US politicians will have the power to throw out any element of the TTIP text that they don't like, regardless of what the negotiators agreed.
Gaining fast track is just one major hurdle that TTIP must overcome. Even more serious from a European viewpoint is the fact that the more that the public finds out about TTIP, the less they like it. That's shown by the fact that the self-organised stand-in for the European Citizens Initiative has now collected an astonishing 1.7 million signatures, with plenty of time to reach 2 or even 3 million before the nominal cut-off date of October 2015. And if you think that filling in a few boxes on a Web page doesn't mean much, consider that recently tens of thousands of people took to the streets across Europe in hundreds of protests against TTIP, in scenes strongly reminiscent of the ACTA demonstrations.
The European Commission remains completely wrong-footed by this swelling tide of discontent. Although the commissioner for trade, Cecilia Malmström, is undoubtedly far more transparent than her predecessor, that's not saying much when you consider it was Karel de Gucht, the man who almost single-handedly destroyed ACTA by his arrogant attitude and high-handed actions. Her repeated claims that she won't agree to anything that might lower standards or harm the European public have been rather undermined by an important recent leak obtained by Corporate Europe Observatory:
According to a leaked European Commission proposal in the ongoing EU-US Transatlantic Trade and Investment Partnership (TTIP) negotiations, EU member state legislative initiatives will have to be vetted for potential impacts on private business interests.
Here's how it will work:
The “regulatory exchange” proposal will force laws drafted by democratically-elected politicians through an extensive screening process. This process will occur throughout the 78 [EU and US] States, not just in Brussels and Washington DC. Laws will be evaluated on whether or not they are compatible with the economic interests of major companies. Responsibility for this screening will lie with the 'Regulatory cooperation body, a permanent, undemocratic, and unaccountable conclave of European and American technocrats.
This is particularly troubling:
“What’s perhaps most scary about this proposal is its potential application to existing regulation – not just paralyzing future legislation but sending us backward,” says David Azoulay at the Center for International Environmental Law (CIEL). “Not only will it extend an outrageously burdensome process on future legislation, but any current legislation in the public interest that doesn’t sit well with trade interests on either side of the Atlantic could be subjected to the same process to make it conform to corporate interests.”
The leak confirms that regulatory co-operation will undermine key institutions and processes that lie at the heart of European society. That's significant, because when it's put together with the other deeply problematic aspect of the proposed trade agreement, ISDS, it reveals the whole TTIP project to be a concerted and thoroughgoing attack on democracy itself, with corporates and international investors as the main beneficiaries.
Despite the massive rejection of ISDS in the European Commission's public consultation, Malmström seems hell-bent on ploughing ahead with it, albeit in some lightly re-worked and re-branded form. But the problem is not the details, but the basic idea - that of giving foreign investors special courts that only they can use to make huge claims against sovereign nations. The only solution is to get rid of ISDS completely. If Malmström stubbornly refuses to do that, it seems clear that TTIP will fall, just as ACTA did.
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Posted by Glyn Moody at 7:54 pm 0 comments
Labels: TTIP
TTIP Update L
It's an important chapter, since, as it says at the start:
The objective of this chapter is to establish an effective and efficient mechanism for avoiding and settling any dispute between the Parties concerning the interpretation and application of this Agreement with a view to arriving, where possible, at a mutually agreed solution.
That is, it covers the entire TTIP agreement, whatever that may turn out to contain. It describes in some detail how an arbitration panel consiting of three people will be used to resolve disputes regarding TTIP between the EU and US. Significantly, the proposed text says:
The ruling of the arbitration panel shall be unconditionally accepted by the Parties.
Here are the requirements for those arbitrators:
Arbitrators shall have specialised knowledge and experience of law and international trade. They shall be independent, serve in their individual capacities and not take instructions from any organisation or government, or be affiliated with the government of any of the Parties, and shall comply with the Code of Conduct set out in Annex II to this Agreement.
When it comes to the arbitration proceedings, which would take place in either Brussels or Washington:
Only the representatives and advisers of the Parties to the dispute may address the arbitration panel.
That is, there are no representatives of the public. However, the latter is graciously permitted to make written submissions to the arbitration panel:
Unless the Parties agree otherwise within three days of the date of the establishment of the arbitration panel, the arbitration panel may receive unsolicited written submissions from natural or legal persons established in the territory of a Party to the dispute who are independent from the governments of the Parties to the dispute, provided that they are made within 10 days of the date of the establishment of the arbitration panel, that they are concise and in no case lon ger than 15 pages typed at double space and that they are directly relevant to a factual or a legal issue under consideration by the arbitration panel.
Perhaps hoping to ward off any criticisms, the European Commission's proposal for dispute resolution includes the following in the remarks section:
This text for the dispute settlement chapter including the relevant annexes (Rules of Procedure, Code of Conduct and Mediation) is practically identical to all the texts for dispute settlement chapters (incl. its annexes) that the EU put forward in all recent bilateral negotiations of a trade agreement.
In other words, nothing to see here, move along please. And, indeed, the logic seems inarguable: trade agreements need dispute settlement procedures to sort out disagreements, this is what we've used innumerable times before, so no one can possibly object. But here's the big problem with that syllogism: TTIP is not (just) a trade agreement.
The European Commission's own (hugely-optimistic) modelling of TTIP assumes that 80% of the benefits will flow not from pushing to zero all trade tariffs, of which there are few, but by removing "non-tariff barriers". And as I noted in my last column, those "non-tariff barriers" are things like regulations and standards. They are essentially *cultural* expressions of a nation, and help to define what kind of society we want to live in by establishing what is protected, and to what extent.
So what the European Commission is proposing with the dispute resolution chapter is how clashes over those key social constructs will be resolved. And the answer is: by a three-person arbitration panel. That is, key aspects of everyday life - the social, environmental and safety protections that have been laid down over decades or more - can be thrown out purely on the say of those three people. And remember: "The ruling of the arbitration panel shall be unconditionally accepted by the Parties." So if, for whatever reason, the arbitration panel says a well-established regulation protecting health and safety, or the environment, has to go, well, it has to go, even if the vast majority of the public that it will effect disagrees.
This exposes the canker at the heart of the TTIP rose: it is applying trade policy instruments - and using the metric of profit - to core aspects of our lives that have nothing to do with either trade or money. This is why TTIP's aim of removing "non-tariff barriers" - "trade frictions" as they are also called - is fundamentally misguided, and profoundly wrong. By all means let us have a trade deal that allows both sides to buy and sell to each other without tariffs; but do not use that desire to allow an unelected, supranational tribunal to make decisions, which cannot be appealed, affecting 800 million people, about cherished facets of our culture and daily lives.
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Posted by Glyn Moody at 7:44 pm 0 comments
Labels: TTIP
TTIP Update XLIX
In December 2013, we had a leak of a position paper on "regulatory coherence" [.pdf] that hinted at what was to come. And now, thanks to the Greens MEP Michel Reimon, we have our first real TTIP leak on the subject . It even comes with a nice cloak-and-dagger angle, since it has been re-typed from the original leaked document to protect the source.
Specifically, it's the EU's paper on the regulatory co-operation on financial regulation in TTIP [.pdf]. This is one of the many really hotly-contested areas, and one where US regulations are stricter than those in the EU. EU corporations therefore want to use TTIP as a way of undermining US laws (de-regulation is a threat for both the EU and the US.)
Here's the basic aim:
The Parties commit to engage in a process towards convergence of their respective regulatory and supervisory frameworks for financial services.
And here's how they aim to do that:
The Parties hereby establish the Joint EU/US Financial Regulatory Forum ("the Forum").
The Forum is in charge of regulatory co-operation between the Parties in the domain of financial services.
What's troubling is the following:
The Joint EU/US Financial Regulatory Forum shall agree on detailed guidelines on mutual reliance adapted for each specific area of financial regulation no later than one year from the entry into force of this agreement.
It's deeply worrying that European politicians and governments will be asked to sign up to TTIP where one of its most important mechanisms - the Financial Regulatory Forum - is left undefined. As Michel Reimon rightly says in his blog post accompanying the leak (original in German):
Thus a Parliamentary resolution [to accept TTIP] would become a blank cheque: we would create a body whose way of working we don't know, and would only learn a year later, when we would have to implement it. Every MEP that agrees to this proposal is giving up his or her independent mandate.
This is an important leak, because it gives us a first glimpse of how TTIP is likely to frame the regulatory co-operation, at least in the financial sector. By an interesting coincidence, another leak in the same area has just appeared on the Corporate Europe Observatory site, which concerns the overall approach to regulation. The document runs to ten pages [.pdf], and is written in fairly opaque terms; I recommend reading the Corporate Europe Observatory's excellent analysis instead. Here are some of the main points.
According to the proposal, as soon as a new regulation is in the pipeline, businesses should be informed through an annual report, and be involved. This is now called “early information on planned acts”, until recently called “early warning”. Already at the planning stage, “the regulating Party” has to offer business lobbyists who have a stake in a piece of legislation or regulation, an opportunity to “provide input”. This input “shall be taken into account” when finalising the proposal (article 6). This means businesses, for instance, at an early stage, can try to block rules intended to prevent the food industry from marketing foodstuffs with toxic substances, laws trying to keep energy companies from destroying the climate, or regulations to combat pollution and protect consumers.
This immediately indicates how the proposed system will act as a brake on democratic decision-making. When proposals are put forward in the EU, say, they will be lobbied against using the new mechanism, making it much harder to bring in bold ideas. It is essentially creating a new, and even more powerful forum for lobbyists to use in order to achieve their paymasters' goals. Here's another way that sovereignty will be reduced:
New regulations should undergo an “impact assessment”, which would be made up of three questions (article 7, reduced from seven in the earlier proposal):
- How does the legislative proposal relate to international instruments?
- How have the planned or existing rules of the other Party been taken into account?
- What impact will the new rule have on trade or investment?
Those questions are primarily tilted towards the interests of business, not citizens. Thanks to the “early information” procedure, businesses can make sure their concerns are included in the report, and should it go against their interests, the report will have to cite a detrimental impact on transatlantic trade.
What's striking here is that everything - without exception - is seen through the optic of business. There is no account taken of social impact, health or environmental issues. Since many measures tackling climate change, for example, will have negative consequences for big business that profit from pollution, it's easy to see the proposal being used to slow down action here even more.
The model presented by the EU negotiators gives big business many tools that will allow them to complain about an “envisaged or planned regulatory act”, and regulations under review (article 9 and 10). In particular, a “regulatory exchange” must take place if a Party is unhappy with the effect of a proposed rule on its trade interests. A dialogue will have to take place, and the Party whose rules are under attack, must co-operate, and must be prepared to answer any given question.
The latest leak also tells us that the transatlantic body responsible for overseeing this filtering process has a new name:
The Regulatory co-operation Body (RCB) under TTIP – previously known as the Regulatory co-operation Council – will have the overall responsibility for regulatory co-operation and one of its obligations will be to “give careful consideration” to businesses proposals on future and existing regulations (article 13).
The name may have changed, but the overall intent hasn't: to put business firmly in the driving seat when it comes to drawing up EU and US regulations. That is no longer purely a trade issue, as tariff adjustment is. Regulations define and shape a society's culture; the regulatory chapter's avowed aim of making all regulations serve business and the pursuit of profit implicitly makes society's wider needs subservient to those of corporates. Of course, the European Commission is fully aware of this implication; and so, at the beginning of this chapter on regulation, we find the usual cant about "public policy objectives":
The provisions of this Chapter do not restrict the right of each Party to adopt and apply measures to achieve legitimate public policy objectives at the level of protection that it considers appropriate, in accordance with its regulatory framework and principles.
But those words are worthless. In theory, that "right" may still exist, but in practice, everything in the leaked document is geared to making it easier for business to obstruct democratic decisions, and to impose a corporate agenda on the entire regulatory process - even down to requiring everything to be judged in purely financial terms.
These two latest leaks are important because they have nothing to do with the Investor-State Dispute Settlement (ISDS) chapter that has currently dominated the TTIP debate. They remind us that ISDS is far from the only danger to national and EU sovereignty, and that we must not think that removing ISDS from TTIP (and the other trade deals with Canada and Singapore) is the end of the story.
The idea of creating any kind of transatlantic "Regulatory co-operation Body" with powers to subvert or even just impede the framing of laws and regulations is clearly incompatible with EU and US legislative institutions, and must be nipped in the bud. That's at least possible thanks to the people who have generously made these leaked documents available, revealing yet more secret machinations by the European Commission to circumvent democracy.
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Posted by Glyn Moody at 7:20 pm 0 comments
Labels: TTIP
TTIP Update XLVIII
It didn't quite work out like that. An unprecedented 150,000 replies were received - and this was on a hitherto obscure aspect of a traditionally boring trade agreement. That number alone bespeaks a new relationship between the public and the politicians who are supposed to serve them. And so the results of that consultation have been eagerly awaited: how exactly would the European Commission manage to turn the ultimate lemon into lemonade?
Now we know: they didn't. The 140-page analysis [.pdf] is almost entirely statistical, providing useful but rather dry summaries of how many people said what kind of thing. Here's the Commission's potted version:
The vast majority of replies, around 145,000 (or 97%), were submitted through various on-line platforms of interest groups, containing pre-defined, negative answers. In addition, the Commission received individual replies from more than 3,000 individuals and some 450 organisations representing a wide spectrum of EU civil society, including NGOs, business organisations, trade unions, consumer groups, law firms and academics. These replies generally go into more detail on the proposed approach. (See MEMO)
Broadly speaking, the replies can be divided into three categories:
replies which indicate opposition to or concerns around TTIP in general;
replies opposing or expressing general concerns about investment protection/ISDS in TTIP;
replies which provide detailed comments on the EU’s suggested approach in TTIP, representing broad and divergent views;
The many replies in the first two categories are a clear indication of the concerns that many citizens across Europe have concerning TTIP generally and about the principle itself of investment protection and ISDS.
More important than that analysis is the European Commission's attitude to the results, and what it intends to do now. Here's what the Commissioner for Trade, Cecilia Malmström is quoted as saying:
“The consultation clearly shows that there is a huge scepticism against the ISDS instrument”, said Cecilia Malmström, Commissioner for Trade, in a comment.
“We need to have an open and frank discussion about investment protection and ISDS in TTIP with EU governments, with the European Parliament and civil society before launching any policy recommendations in this area. This will be the first immediate step following the publication of this report. I also note that there were constructive proposals in the consultation on areas that can be reformed.
Specifically:
In the first quarter of 2015, the Commission will organise a number of consultation meetings with EU governments, the European Parliament, and different stakeholders, including NGOs, business, trade unions, consumer and environment organisations, to discuss investment protection and ISDS in TTIP on the basis of this report. As a first step, the consultation results will be presented to the INTA Committee of the European Parliament on 22 January. Following these consultations during the first quarter, the Commission will develop specific proposals for the TTIP negotiations.
Yes, the response to the consultation’s overwhelmingly negative outcome is...to hold yet more consultations. That is of a piece with the consultation itself, which was clearly designed for professional lobbyists who are paid (handsomely) to spend much of their time responding to such consultations. Running a few more just means they get paid longer. But for the public, the opposite is true: repeated consultations are likely to wear down people's ability to respond, not least because the public has to earn a living, and therefore filling in forms - never mind attending meetings - represents a real cost to them.
The same contempt for ordinary people struggling to understand and respond to highly complex concepts in order to make their hitherto ignored views heard is present throughout the analysis:
About 70.000 replies consist of seven different batches, submitted through eight different NGOs. Each batch contains identical or very similar answers to all 13 questions;
Some 50.000 replies submitted via one NGO contai n a different pattern. Questions 1 to 12 were answered with a general statement, as follows: "no comment – I don’t think that ISDS should be part of TTIP", while various individual answers were given to the last question (N° 13-general assessment).
Finally, there are around 25.000 replies which present similar features, i.e. no answer to questions 1 to 12 but only to question 13. The answers to question 13 are different but most of them express similar views. It was not possible to identify the source of these replies. Howe ver, given the similarities with the other collective submissions they were considered, for th e purposes of this report, as collective submissions as well.
It's clear these "collective submissions" are regarded as inferior in some way to the doubtless highly polished replies from corporations and their lobbyists. The views of a senior US official, quoted in an article from European Voice, are even more contemptuous:
Europeans should be careful about giving the same weight to “a thoughtful response or a one-liner saying ‘I hate TTIP’”, he said, going on to question the commitment of some anti-TTIP NGOs to transparency. “In the US, NGOs publish their finances, but in Europe, we don’t really know,” he said. “We need to understand better; everybody should understand who is behind the NGOs.”
Lovely: not only are the simple expressions from the public less valid than those "thoughtful responses" from big companies and others, but the unnamed senior US official even goes so far as to indulge in a little ad hominem attack: "everybody should understand who is behind the NGOs". Got that? Those 145,000 negative responses are actually an underhand and carefully-orchestrated conspiracy by dark forces - probably communists - who just hate America for its freedom...
Returning to the less paranoid world of the European Commission, we read:
“we need to reflect upon how to address the fact that EU countries already have 1400 bilateral agreements of this kind, of which some date back to the 50s”, added Malmström.
"The vast majority of these agreements do not include the kind of guarantees that the EU would like to see. This will also have to be an important element of our reflection when considering how to best deal with the question of investment protection in EU agreements, as failure to replace them by more advanced provisions will mean they remain in force – with all the legitimate concerns they have been raising over the last months", the Commissioner highlighted.
This is a very weak argument. The vast majority of those 1400 bilateral agreements include ISDS as a weapon for European nations to use against developing nations: there is practically zero danger of ISDS being used against the EU by these countries, which have few investments in Europe. So forcing Europeans to accept the many and major risks of ISDS as a kind of "dry run" for updates that aren't even needed is just ridiculous.
For TTIP, the central question is just: do we need ISDS? The simple answer is: we do not. The EU and US have extremely well-functioning legal systems that make ISDS unnecessary. That's not just my opinion, it's the opinion of thousands of investors that have put their money into both the US and EU. The sums involved are vast: in 2012, the EU had invested € 1.655 *trillion* in the US, and the US had invested € 1.536 trillion in the EU. By now, that figure will be much higher. That's clear proof that ISDS is not needed in order to encourage investment on a scale unmatched anywhere else in the world. And finally, for any company that still thinks it needs some kind of protection when it invests abroad, there is an insurance scheme run by the World Bank designed specifically for this purpose, making ISDS unnecessary. These three simple facts make all the details about the European Commission's proposed "improvements" to ISDS irrelevant: you don't waste time and effort fixing what you don't need.
However, the very real dangers of ISDS - admitted even by the European Commission - mean that ISDS should not only be dropped from TTIP, but that it must go from the agreement with Canada (CETA), and the one with Singapore, neither of which is finalised yet. Both of these include ISDS, which would give companies from other countries - the US in particular - the ability to sue the EU indirectly. That, in its turn, will bring with it a regulatory chill as EU nations think twice about bringing in laws and regulations that might lead to claims under ISDS.
No matter how many times the European Commission repeats that it won't let ISDS force a government to change its law - something that has already happened - the mere threat of costly legal action and huge awards will still interfere with democratic decision-making. That alone is reason enough to drop ISDS. Combine that fact with the unequivocal rejection by 145,000 people who went to the trouble of participating in the ISDS consultation, and this shouldn't even be a question any more.
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Posted by Glyn Moody at 7:13 pm 0 comments
Labels: TTIP
TTIP Update XLVII
The issue that crops up most often after ISDS is probably transparency - or rather the complete lack of it. Yes, it's true that there have been some token releases of documents: initial position papers in 2013, and some more in 2014; but these don't really tell us much that we didn't already know, or could guess. The main obstacle to greater openness was Karel De Gucht, the European Commissioner for Trade when TTIP was launched. As he showed time and again during the ACTA fiasco, he had little but contempt for the European public and its unconscionable desire to know what the politicians whose salaries it pays are up to in Brussels. That made his retirement at the end of last year an important moment and opportunity.
His successor, Cecilia Malmström, is cut from a very different cloth, as was apparent from this announcement right at the start of her tenure of De Gucht's post:
'TTIP is an immensely important agreement,' said Commissioner Malmström, 'with huge potential to create jobs and growth and to set standards. Yet, even though the TTIP talks are the most transparent and open the Commission has ever conducted, there are still a lot of doubts around what is being negotiated.'
'That's why we want to consult even more extensively on TTIP, and go even further in terms of transparency. Increased transparency will enable us to show, more clearly, what the negotiations are about and to de-mystify them. We will use this as a basis to engage further with a broad range of stakeholders and the public,' said Malmström.
The Commissioner outlined two main proposals for boosting transparency.
First, to extend access to TTIP texts to all Members of the European Parliament, beyond the currently limited group of Members of the European Parliament’s International Trade Committee.
Second, to publish texts setting out the EU's specific negotiating proposals on TTIP.
As I've discussed many times, TTIP does not have "huge potential to create jobs and growth", even under the most optimistic assumptions, but it's certainly important, so Malmström's promise of consulting "even more extensively" is extremely welcome. Indeed, I was pleasantly surprised last month to experience first-hand just how extensively she means to consult:
Whether that meeting actually happens, remains to be seen. But Malmström's two main proposals for "boosting transparency" have now been implemented. The first of them - providing access to MEPs - happened immediately. The second, publishing actual negotiating texts - happened earlier this week:
The European Commission today published a raft of texts setting out EU proposals for legal text in the Transatlantic Trade and Investment Partnership (TTIP) it is negotiating with the US. This is the first time the Commission has made public such proposals in bilateral trade talks and reflects its commitment to greater transparency in the negotiations.
Specifically, here's what is being made available:
The so-called 'textual proposals' published today set out the EU’s specific proposals for legal text that has been tabled in the proposed TTIP. They set out actual language and binding commitments which the EU would like to see in the parts of the agreement covering regulatory and rules issues. The eight EU textual proposals cover competition, food safety and animal and plant health, customs issues, technical barriers to trade, small and medium-sized enterprises (SMEs), and government-to-government dispute settlement (GGDS, not to be confused with ISDS). Today, the Commission has also published TTIP position papers explaining the EU's approach on engineering, vehicles, and sustainable development, bringing the total number of position papers it has made public up to 15.
To make the online documents more accessible to the non-expert, the Commission is also publishing a 'Reader's Guide', explaining what each text means. It is also issuing a glossary of terms and acronyms, and a series of factsheets setting out in plain language what is at stake in each chapter of TTIP and what the EU's aims are in each area.
That's certainly a big step forward for transparency, as is to be welcomed. However, not everything is available yet. For example, in two areas that are likely to be of particular interesting to readers of this column - "Information and communication technology" and "Intellectual property rights" - we only have some rather thin factsheets. The first of these [.pdf] is particularly slight - just one page. Perhaps the only element of interest is the following:
In ICT, we want to:
set common principles for certifying ICT products, especially for encoding and decoding information ('cryptography' in the jargon).
But the European Commission is quick to assure us that:
The EU won’t accept lower security levels. We want common principles for assessing how products comply with regulations.
Presumably that means the EU and US will agree to use the same set of backdoors in crypto tools...
On the copyright and patent front [.pdf], it's striking that the Commission is still assuring us that TTIP is not ACTA 2.0 - evidence once more of how deep the fears run of another defeat at the hands of the European Parliament - for example:
The EU and US have detailed enforcement provisions already, whereas some other countries that planned to join ACTA didn't. So we won’t negotiate rules on things like:
penal enforcement
internet service provider liability.
The idea that criminal penalties and ISP liability were only in ACTA because "some countries" did have strong enforcement is ridiculous: they were there because powerful copyright lobbyies in the EU and US wanted them there. But it is nonetheless welcome to have set down here that neither will be present in TTIP.
The most recent release of TTIP documents shows two things. First, that we have started the journey towards real transparency, but by no means arrived there yet. And secondly - and perhaps most importantly - that public advocacy does work. Although it is true that the present move owes a lot to Malmström - and kudos to her for taking this step - it is also true that it would never have happened had not thousands of people demanded more openness. It demonstrates what can be done simply by asking in a polite but persistent manner, and encourages us to keep doing so.
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Posted by Glyn Moody at 6:16 pm 0 comments
Labels: TTIP
TTIP Update XLVI
What the European Commission rarely mentions is how often this mechanism has been used against EU member states, and how much this mechanism has cost EU taxpayers. The ongoing negotiations of trade and investment agreements – including the Transatlantic Trade and Investment Partnership, the Transpacific Partnership, and negotiations between the EU and the US respectively with China – are unprecedented in size and scope, and would drastically expand the extent of foreign direct investments covered by investor-state arbitration. Such an expansion would risk seriously undermining governments’ ability to regulate for the protection of people and the environment.
Here are the report's key findings:
127 known ISDS cases have been brought against 20 EU member states since 1994. Details of the compensation sought by foreign investors was publicly available for only 62 out of the 127 cases (48%). The compensation sought for in these 62 cases amounts to almost €30 billion.
The total amount awarded to foreign investors – inclusive of known interest, arbitration fees, and other expenses and fees, as well as the only known settlement payment made by an EU member state – was publicly available for 14 out of the 127 cases (11%) and amounts to €3.5 billion.
The largest known amount to be awarded by a tribunal against an EU member state was €553 million in the Ceskoslovenska Obchodni Banka vs. Slovak Republic case (1997).
The report is valuable not just for bringing all these figures together for the first time, but for providing details of several of the most significant cases. They're all well-worth reading, since they flesh out the otherwise rather dry ISDS concept. I'd like to focus on one, which raises some particularly important issues. Here's the report's summary of the case:
The Micula brothers invested in the North West region of Romania – setting up multiple food processing, milling and manufacturing businesses. In 2005, the claimants initiated a dispute against Romania seeking compensation to the tune of €450 million. The case emerged following a series of decisions taken by Romania, which altered or withdrew a number of investment incentives (ie: exemptions from custom duties and certain taxes) that had previously been offered to the Micula brothers in support of their investment in a disadvantaged region of Romania. Romania argued that the regulatory changes they made were warranted, as they were implemented as part of the lead up to accession to the EU in 2007. In December 2013 the tribunal found Romania in breach of the Sweden-Romania BIT and obliged to pay more than $250 million (€183,311,335) in damages.
Clearly, $250 million is a lot of money for a government like Romania to find, money that will have to be taken from other areas of the country's budget - perhaps things like health provision and education. That's bad enough, but what's really problematic here is that Romania withdrew the investment incentives involved in the case because the European Commission required it as a condition of Romania's accession to the European Union:
The Micula vs. Romania case has incited a great deal of interest, particularly in relation to the sovereignty of EU law. The European Commission (EC) intervened and attempted to convince the tribunal that the actions implemented by Romania were taken in an effort to comply with EU law obligations to eliminate state aid (ie: subsidies and incentives). The Commission argued that if the tribunal ordered Romania to pay compensation it would be considered state aid under a different pretense. The arbitrators were not swayed by the EC’s interventions and, in relation to the enforceability of the final award, drew "attention to Romania’s obligations under the ICSID Convention to comply with the final ICSID awards."
Put simply, what that means is that the tribunal ruled that when it came to protecting investments, EU law should be ignored - a real slap in the face for the European Commission, which had made a direct intervention to avoid just such an outcome.
This is the key problem with ISDS: it places the rights of corporations above the rights of nations - indeed, in this case, above the rights of the EU to determine law within its borders. ISDS cannot be "fixed", as the European Commission would have us believe, because it was designed with exactly this purpose in mind: it was introduced as a way of protecting investments in countries where the local rule of law could not be depended upon. Since that is manifestly not the case in the EU or US, it serves no purpose other than to undermine the strong legal systems there. The only solution is therefore to drop ISDS from TTIP, CETA and all future agreements.
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Posted by Glyn Moody at 6:07 pm 0 comments
Labels: TTIP