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CETA flouts democracy

If CETA had been signed in the 1990s Governments would have been sued to prevent smoking bans or plastic bag taxes

One year on from the UN Summit to agree the Sustainable Development Goals, and approaching the first anniversary of the Paris Agreement on Climate Change there are worrying signs that the consensus to ‘leave no one behind’ was no more than a shallow aspiration. The industry in measurement of the goals has intensified. There is the opportunity to develop metrics for 17 goals and 169 targets. Whilst the NGOs and the social scientists argue about the fine detail of how to measure progress, a significant violation of EU law is about to happen that will have a chilling effect on these global agreements.

The EU has decided to provisionally apply the Canadian European Trade Agreement (CETA). It has done so despite overwhelming legal opinion that this would be in contravention of the EU’s founding treaties. The Agreement is not a ‘trade’ deal in the ordinary sense of the word. The scope of the deal extends far beyond trade into many areas of investment and hence, in the eyes of the law, is a ‘mixed deal’. As such it needs to be ratified by every national parliament before being applied. However, the EU decision means that it comes into force in its entirety as soon as it is signed.

The most controversial element of CETA is inclusion of an Investor State Dispute Settlement (ISDS) system. This mandates investor courts which sit outside the regular national legal system, but have the ability to sue governments for actions which undermine the rights of investors. If a government moves to change policy to prioritise issues such as public health, social cohesion, or environmental sustainability over the financial profit of investors, it can and will be sued.

ISDS courts exist already. They have grown exponentially in the past decade to over 600 in 2014 as bilateral trade deals have expanded. Once CETA is provisionally applied, it is anticipated that a raft of new cases will be lodged. Even if countries defy the European Commission and if CETA, as expected, is legally challenged and struck down in the Spring of 2018, corporations will still have three years to sue governments.

If national and international policy frameworks were heading in a shared trajectory of social cohesion, economic prosperity and environmental sustainability, ‘copper fastening’ them into such trade and investment deals would be just about palatable. The logic of handing over huge swathes of policy to unelected and unaccountable entities could still be questioned, but there could be some merit to copperfastening good policies and suing those in violation.

The problem is that any such shared trajectory is far from the current reality. CETA, and similar deals, modelled on CETA, pose a serious threat to democracy and stability globally. They will do nothing to help address major global challenges such as climate change, which requires a pro-active choice to end the fossil fuel era and shift to a zero-carbon future. They will undermine efforts to address significant public health problems as science develops, such as our over dependency on antibiotics. If CETA had been signed in the 1990s, it is highly unlikely we would have smoking bans or plastic bag taxes. Governments would have been sued to prevent them.

The Sustainable Development Goals and the Paris Agreement require transformative action. Current frameworks, based on the assumption of ever-increasing trade in resources on a finite planet, are deeply flawed. Addressing climate change requires policy choices to prioritise certain forms of activity not on the basis of profit alone, but on the basis of their social and environmental good. Such choices are anathema to the provisions of CETA and its like. CETA will inevitably lead to governmental reluctance to pursue such progressive policies, for fear of being sued. Bold ideas are now needed that require radically new policy frameworks, not the chilling effect of CETA.

The German population recognised this threat to democracy and over a million people took to the streets in Berlin to protest against CETA and its ‘sister’ TTIP, in mid-September. In Ireland, despite the fact that our government has endorsed the proposal, there has been no public outcry. Despite the efforts of a number of NGOs and concerned citizens, very few people are even aware that this is happening.

The poorest people will suffer the most with this next generation of trade and investment. Most EU countries have already put in place significant public health and environmental frameworks. Developing countries, on the other hand, may now be further pushed to retain low standards rather than raising them. CETA moves sustainable development and curtailing climate change ever further down the agenda.

Lorna Gold is Head of Policy & Advocacy with Trocaire