Commission tries to “put lipstick on a pig” with alternative corporate court system

Wednesday, 16 September, 2015
  • Campaigners say EU has ignored European public;
  • Proves the need to halt CETA deal now

Trade campaigners have slammed today’s European Commission proposal for an alternative ‘corporate court’ system to replace the controversial Investor State Dispute Settlement (ISDS) mechanism. ISDS forms a central part of the proposed EU-USA trade agreement, TTIP allowing multinational corporations to sue governments if they believe they’ve been treated unfairly.

Nearly 3 million European citizens have rejected TTIP, while 97% of respondents to a EU commission consultation rejected ISDS outright. The Commission today proposes a permanent court system which would make ISDS more transparent and allow for appeals. Campaigners claim that the Commission’s proposal today makes only cosmetic changes to the essential properties of ISDS, which enables corporations to sue governments in secret courts for enacting legislation that might harm the profits of the corporation.

Global Justice Now also said that the trade deal with the EU and Canada – CETA – which has already been negotiated and is awaiting ratification, must be halted immediately. CETA contains the old ISDS mechanism.

Nick Dearden, the director of Global Justice Now said:

“The European Commission says that this new proposal is based on “substantial input” from its public consultation, but 97% of the thousands of responses it received in this consultation were clearly opposed to ISDS in any form.  This alternative proposal is essentially a PR exercise to get around the enormous controversy and opposition that has been generated by ISDS. The Commission can try to put lipstick on a pig, but this new proposal doesn’t change the fundamental problem of giving corporations frightening new powers at the expense of our national democracies. Cecilia Malmström has yet to give a satisfactory answer as to why our established court system is unable to deal with trade law.

“Although a little more transparency is no bad thing, the real issue at hand here is that of corporate power. Commissioner Malmström says she wants to “establish a new system built around the elements that make citizens trust domestic or international courts” – but she hasn’t explained why those courts are not good enough for multinational corporations to use.

“This change shows the European Commission is feeling the pressure of nearly 3 million people opposing TTIP and CETA, the two looming deals featuring ISDS. But the Commission has at least admitted with this proposal that the ISDS which is written into CETA is unacceptable, so why haven’t they halted the ratification process?”

See also: 10 Reasons why the new ISDS compromise is a bad deal