10 Reasons to Be Worried about the Trojan Treaties

By Healy, Hazel | New Internationalist, May 2014 | Go to article overview

10 Reasons to Be Worried about the Trojan Treaties


Healy, Hazel, New Internationalist


Critics have labelled them 'a huge corporate wish-list' and a 'blank cheque for US companies'.

Under the guise of restarting the lagging world economy, two sweeping freetrade treaties are under negotiation that, if agreed, would swing the power balance away from states in favour of big business.

Led by the US, 12 governments in Asia, Oceania and the Americas have spent the past four years mulling over the Trans-Pacific Partnership (TPP). The 11 other potential signatories are Canada, Australia, New Zealand/Aoteoroa, Japan, Malaysia, Vietnam, Brunei, Singapore, Chile, Mexico and Peru.

TPP is mirrored by the Transatlantic Trade and Investment Partnership (TTIP), which the US and European Union (EU) have been negotiating since July 2013. Talks are expected to continue for the next two years.

If signed, both deals would be binding. Terms could only be altered by a consensus of all signatory nations.

[Sidebar]

1 Public in the dark

These deals are being negotiated in extreme secrecy. Elected officials worldwide have complained about being locked out of talks.

Public knowledge of the contents is thanks only to leaks by concerned representatives party to the drafts, such as German MEPs in the case of TTIP.

Repeated calls for the text to be released have been ignored. Wikileaks - which has disseminated leaks of TPP to date - is offering a crowdsourced reward for any new information.

By contrast, the US trade delegations have more than 600 corporate advisers with unlimited access to drafts and preparatory texts.1

The democratic deficit is not accidental. The negotiations would be unlikely to survive the glare of public scrutiny.

2 Beefed up IP

The TPP's leaked 'Intellectual Property' (IP) chapter revealed that big digital-content companies are pushing for restrictive controls on the internet, and hefty copyright fines.

Firms want 'harmonization' with laxer US privacy laws to get hold of EU citizens' personal data, while pharmaceutical companies are trying to block access to generic drugs.

3 Want some hormones with that?

TTIP may jeopardize food-safety regulations - 'barriers' to trade that incur costs and delays. We may see delicacies such as hormonetreated US beef and chlorine-dipped chicken go on sale in Europe, whose stricter laws on animal welfare and pesticides may also be eroded. Biotech firms in the US, where genetically modified (GM) foods are widely grown, want to do away with GM food-labelling laws in the EU.

4 Regulate me? I'll sue your ass

This one could really upset the apple cart. Both treaties are thought to include overweening investor protection clauses, which would allow corporations to sue governments for domestic laws that dent their profits - including future profits.

Companies pleading losses to publicinterest policies such as environmental protection or anti-pollution laws could bring claims to special international tribunals. Run by corporate lawyers, their decision could override a nation's highest court, order trade sanctions and compensation - with no upper limit.

This is not entirely new. Companies are already suing states under clauses written into country deals called 'Bilateral Investment Treaties' (BITs), with around 500 cases filed every year. Tobacco giant Philip Morris, which is using BITs to seek billions of dollars in compensation from Australia and Uruguay for antismoking laws, is a taste of what's to come.2

TPP and TTIP would take investor-state disputes to a new extreme. TTIP alone would allow 75,000 new companies in the US and the EU to sue governments.

At a minimum cost to governments of nearly $8 million in tribunal fees and legal bills, whatever the outcome, fear of arbitration would have a 'chilling effect' on attempts at regulation, and leave states powerless when new risks present.1

5 More work for firms like SERCO

Under the treaties, governments may be obliged to open up public services such as health and education to transnational corporations. …

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