TWN Info Service on WTO and Trade Issues (Nov16/05)
2 November 2016
Third World Network

CETA a corporate-driven, ‘flawed' treaty, charges UN expert
Published in SUNS #8345 dated 1 November 2016

Geneva, 31 Oct (Kanaga Raja) -- The Comprehensive Economic and Trade Agreement (CETA) between the European Union and Canada is a corporate-driven, fundamentally flawed treaty which should not be signed or ratified without a referendum in each of the countries concerned, a United Nations human rights expert has said.

The UN Independent Expert on the promotion of a democratic and equitable international order, Mr Alfred de Zayas (United States), made this recommendation on Friday 28 October, ahead of the signing of the trade agreement by both parties.

According to a Guardian news report, the free trade agreement was signed by Canadian Prime Minister Justin Trudeau and top EU officials in Brussels on Sunday, 30 October.

However, in order for it to come into force, the trade deal will need to be approved by some 38 national and regional parliaments, said the Guardian news report.

In a UN news release of 28 October, Mr De Zayas denounced the pressures that were brought to bear on the Belgian regional parliament of Wallonia, which initially said that it would not approve the treaty but later said its concerns had been met.

"A culture of bullying and intimidation becomes apparent when it comes to trade agreements that currently get priority over human rights," the rights expert said.

Mr De Zayas, in his previous reports to both the Human Rights Council and General Assembly, had warned that CETA is incompatible with the rule of law, democracy and human rights.

He had substantiated how and why this was the case before the Parliamentary Assembly of the Council of Europe.

The rights expert expressed the belief that both CETA and the Trans-Atlantic Trade and Investment Partnership (TTIP) agreement currently being negotiated by the EU and the US give undue power to corporations at the expense of national governments and human rights.

The mere existence of investor-state dispute settlement generates a regulatory chill, he noted.

"The danger of CETA and TTIP being signed and one day entering into force is so serious that every stakeholder, especially parliamentarians from EU Member States, should now be given the opportunity to articulate the pros and cons," he said.

The corporate-driven agenda gravely endangers labour, health and other social legislation, and there is no justification to fast-track it, Mr. De Zayas warned.

"Civil society should demand referendums on the approval of CETA or any other such mega-treaty that has been negotiated behind closed doors," the rights expert recommended.

He also said the EU should have heeded expert warnings and strong civil society opposition to CETA.

Among the specific concerns expressed by Mr De Zayas over CETA include provisions which he said could hamper States' regulatory powers and could allow investment companies to sue over legislation affecting profits, even in cases where the laws were designed to protect workers' rights, public health or the environment.

States should not sign the agreement unless their powers to regulate and legislate in the public interest are fully safeguarded and the so-called "investment protection" chapter is removed, he underlined.

"This chapter creates privileges for investors at the expense of the public," said Mr. de Zayas.

He noted that the new text may slightly amend this chapter.

However, he emphasised that the Investment Court System (ICS) is similarly incompatible with the International Covenant on Civil and Political Rights (ICCPR), which requires legal cases to be heard by transparent, accountable, independent public tribunals.

"The associations of German and Spanish judges have already decried this kind of investor-State dispute settlement, which is a one-way street, and also discriminates against domestic enterprises."

Moreover, he said, ICS is not necessary when all participating States are parties to the ICCPR and already have public courts that are independent, transparent and accountable.

"CETA - along with most trade and investment agreements - is fundamentally flawed unless specific provision stipulates that the regulatory power of States is paramount and must not be impacted by a regulatory chill."

"It must also be clear that in case of conflict between commercial treaties and human rights treaties, it is the latter that must prevail," said the rights expert.

He pointed out that there was now a strengthened case for a legally binding instrument on corporate social responsibility, obliging transnational corporations not to interfere in the internal affairs of States, and imposing sanctions when they pollute the environment or shift their profits into tax havens.

In this context, the rights expert drew attention to the inter-governmental working group on transnational corporations that was established by the Human Rights Council, and which held its second session here last week.

Mr. de Zayas, who has participated in this working group, urged the prompt adoption of a treaty that makes the Guiding Principles on Business and Human Rights legally binding and enforceable.

The rights expert also said it was time to discuss the secrecy surrounding the drawing up of the CETA treaty, and the anomaly that much of the information about it became available only through whistleblowers, in violation of State obligations to ensure open access to information.

"The constitutionality of the CETA and TTIP agreements should be tested before the European Court of Justice in Luxembourg, and the human rights aspects before the European Court of Human Rights, which could be called upon to issue interim measures of protection," he said.

"National courts should also test the compatibility of the agreements with national constitutions," Mr De Zayas added.

"There is a legitimate fear that CETA will dilute environmental standards, food security, and health and labour protection," he said.

"A treaty that strengthens the position of investors, transnational corporations and monopolies at the expense of public interest conflicts with the duty of States to protect all people under their jurisdiction from internal and external threats."

The rights expert also said that the EU should have paid greater attention to a warning from a committee of Members of Parliament from the Parliamentary Assembly of the Council of Europe.

The Committee on Social Affairs, Health and Sustainable Development had said earlier this month that CETA imposed unacceptable restrictions on the legislative powers of national parliaments, and called for the signing to be postponed.


Meanwhile, Friends of the Earth International (FoEI) commended what it said was the rapidly increasing support, interest and mobilisation evident in Geneva during talks in the week of 24-28 October aimed at establishing a new and unprecedented treaty on TNCs and human rights.

In a press release following the end of the week-long session, FoEI said that the creation of a set of international binding rules will have profound implications for the world's largest companies, obliging them to respect human rights in a way they have never had to before.

"This Treaty was always meant to be about binding rules to finally rein in the behaviour of transnational companies and their supply chains. The fact that so many countries - led by South Africa and Ecuador - voiced their unequivocal support for legally binding rules, sets exactly the right tone for an ambitious and far-reaching negotiation." said Lucia Ortiz, from Friends of the Earth Brazil and co-coordinator of FoEI's Economic Justice-Resisting Neoliberalism programme.

FoEI said that it was pleased to see an increasing number of countries - including the EU and member states - participating in a positive and constructive exchange of views together with civil society organisations, lawyers and others.

"We are content to see the EU and some member states finally in the room - in response to the demands of 90,000 European citizens who called on them to step up to the task of creating a Treaty that puts human rights before corporate interests," said Anne van Schaik from Friends of the Earth Europe.

"However, we were hoping that they would participate more actively in the debate, and would be more prepared, but at least they came. Now they need to focus on collaborating with civil society and affected people around the world, to start crafting the concrete elements needed for a strong and effective Treaty," she added.

"More than a hundred activists from 29 countries were present at this session in Geneva - the movement for a binding treaty that puts human rights above corporate profits is snowballing," Lucia Ortiz said, adding that civil society strength was felt outside in public activities, and inside where strong interventions and proposals on content were made.

FoEI said it looks forward to the next stage in this pivotal process, when Ecuador, the Chair, will begin a process for formal negotiations. +