October 6, 2016

A deceitful attempt to get CETA signed

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Update: new version of Declaration, see below

The European Commission and Canadian government work on a “Joint Interpretative Declaration” that should convince governments that have doubts about signing the EU-Canada trade agreement (CETA).

The Declaration does not change CETA’s text. It does not give a clarification of provisions. Take the first paragraph of the section on Investment Protection:

“CETA includes modern rules on investment that preserve the right of governments to regulate in the public interest including when such regulations affect a foreign investment, while ensuring a high level of protection for investments and providing for fair and transparent dispute resolution. CETA will not result in foreign investors being treated more favourably than domestic investors.”

In reality, first, CETA’s right to regulate clause does not create any new right to regulate, but it is just “reaffirming” a right that is assumed to already exist.

Second, foreign investors get the right to challenge government decisions in supranational arbitration, a right domestic investors do not have – they get greater procedural rights. Furthermore, foreign investors would also benefit from far reaching substantive rights, which investment tribunals have interpreted expansively, beyond the interpretations of local courts. For instance, investment tribunals have (a) seen the exercise of discretionary power by enforcement agencies as discriminatory, and (b) interpreted legitimate expectations in a broader way than local courts. See footnotes 2 and 3 here.

This is just one paragraph, and the rest of the text is just as meaningless, as the Declaration does not change the CETA text. The Declaration is a sham.

Update: new version of Declaration

The European Commission and Canadian government made a new version (CETA-verklaring). It is a bit longer, but does not have a higher quality. For instance, the first paragraph of the section on Investment Protection has one additional sentence:

“CETA does not privilege recourse to the investment court system set up by the agreement. Investors may choose instead to pursue available recourse in domestic courts.”

This is meaningless. The agreement creates a competing system. To attract business, it will have to provide investors with beneficial decisions. Investors may choose the investment court system over domestic systems.

Also note that the Declaration does not solve issues with data protection, as noted by Vrijschrift and issues with intellectual property rights (page 47).

See also S2B Joint Interpretative Declaration on CETA – Unpacking the “clarifications” on investment protection

Update: further reactions on earlier version

Simon Lester noted: “This has about the same impact that a press release would.

Gabriel Siles-Brügge noted: “The draft #CETA declaration leaked – & it reads more like a press release than a series of enforceable obligations“.

Van Harten: Comments on the EU-Canada Declaration on the CETA; Conclusion: “The CETA’s special protections for foreign investors are out of step with principles of democratic regulation, independence and fairness in adjudication, and balance in the allocation of rights and responsibilities. The Declaration does not ameliorate the resulting concerns. Overall, it furthers the CETA’s skewing of state decision-making in favour of large multinationals, wealthy individuals, and speculators in international litigation.”

Friends of the Earth Europe: CETA declaration not worth the paper it is written on, claim Friends of the Earth Europe

TNI: Leaked CETA interpretative declaration an utterly inadequate solution

Greenpeace: Leaked EU-Canada joint declaration has legal weight of a holiday brochure

Steven Shrybman: “(…) You will know from our opinion that we distinguished between a “qualified” and “mere” declaration. The former requires the parties to clearly identify the declaration as a condition precedent to their approval of a treaty. That question is moot in the present circumstances because, notwithstanding its title, the document could not in fact be considered an “interpretative declaration” under international law for the simple reason it doesn’t even offer the pretext of interpreting CETA provisions on investor protection.

To not put too fine a point a point on it, the comments about investor protection are akin to a press release touting the virtues, as the authors perceive them, of the investor protection rules CETA would entrench.

In our opinion, no party could credibly present such a document as an “interpretative declaration” to a Tribunal called upon to determine an investor rights dispute. Moreover, in the unlikely event that should occur, a Tribunal that gave it any consideration would risk its own credibility.” See also the earlier opinion.

Many people compare it with a press release, which was actually my first thought too.

In Dutch Parliament, some speakers reffered to the Vienna Convention on the Law of Treaties. See article 31.