Ten reasons why the Canada-EU trade deal (CETA) must be stopped

Ten reasons why the Canada-EU trade deal (CETA) must be stopped

Guy Taylor

By: Guy Taylor
Date: 17 November 2016
Campaigns: Trade

ceta_thumbnailIn the coming weeks, decision makers in the European parliament will be getting together to vote on the proposed free trade deal between Canada and the EU, known as CETA*. We’re repeatedly told that this deal is all about making it easier for the two regions to trade with each other and will bring about enormous economic benefits for everyone concerned. But when you scratch the surface a much more sinister picture emerges. One where already powerful corporations are given all sorts of new powers to influence governments and strip away all sorts of important legal protections for public services, workers and the environment.

This year, an enormous public outcry managed to see off a similar trade deal on the table between the EU and the USA, that was called TTIP. CETA hasn’t generated the same amount of attention and controversy, and that’s partly because people feel that we don’t have as much to fear from Canada as we do from the USA. It’s easy to get lulled into a false sense of security when you think of Canada as being all about big green spaces, hearty out-doors folks and stunning scenery, but the reality is that this trade deal represents another serious attempt by corporate powers to wrestle control away from parliamentary democracies.

Here’s ten reasons why you should be seriously concerned about CETA, and why you might want to email your MEP about it.

1. Say goodbye to ever renationalising trains, water, whatever…

CETA would make future reversals or re-nationalisation of privatised industry or services impossible. We’ve undergone a series of disastrous privatisations, and polls show that there is a constant public appetite to take many of them back into public control. The ‘ratchet clause’ in CETA means that that couldn’t happen.

2. Get ready to get sued by Canadian corporations. A lot.

At the heart of these trade deals there’s ‘investor protection’, which doesn’t sound bad, but is actually a massively controversial system that allows corporations to sue governments in special courts outside of the normal legal system if they pass laws or make decisions that are harmful to their profits.

Canadian companies have launched a total of 42 of these cases against governments, half of which are from extractive (drilling, fracking, mining) firms. These cases have resulted in at least $2 billion being awarded to the companies, and there are outstanding claims in ongoing cases for around $20 billion.

3. Canadian corporations are not all fluffy and wholesome – look at Gabriel Resources

Gabriel Resources are the Canadian company in the middle of a huge controversy in Romania. They are currently suing the Romanian government for $4 billion over the denial of a permit to establish a toxic open cast gold mine in Rosia Montana, a UNESCO World Heritage area in Transylvania. The case is ongoing.

4. Canadian fossil fuel companies have sued governments over fracking decisions

Lone Pine Resources is a Canadian firm, suing the Canadian government through the free trade between Canada, Mexico and the USA (NAFTA). Lone Pine held five permits for exploration for oil and gas in Quebec in 2011. The Quebec state government revoked one of these licences to allow for investigation into the potentially harmful effects of fracking under the St Lawrence river. A one year moratorium on fracking was instigated and Lone Pine sued for $118.9 million.

5. Get ready to get sued by US corporations. A lot.

Not only do the governments of the EU (including the UK, before and after Brexit) open themselves up for legal action from Canadian corporations, there’s 40,000+ corporations based in the US that have significant operations ongoing in Canada and would be able to take advantage of CETA. So add to the litigious Canadian companies the even more litigious US companies and we have a whole bunch of litigation coming our way!

6. Corporations don’t always win these cases, but they’re still enormously expensive

These corporate court cases are sometimes ‘won’ by the defending state. But a state cannot really win a case – it can successfully defend a case, but it often still loses out. For instance, Peru just this week successfully defended itself against a corporate cases against the US company Renco, but still has to stump up the $8.4 million it spent on defending itself (which is an average to low amount paid out for such legal advice and services) AND  half of the tribunal costs.

7. The European Commission said they’d fix the whole massively undemocratic corporate courts thing, but instead they just put lipstick on a pig.

Many MEPs are being told that the controversial corporate court system (known as ISDS) has been replaced by something better, namely the Investor Court System (ICS). What they are not being told is that ICS isn’t a replacement, it’s a slightly amended renaming operation and almost every single complaint and criticism of ISDS is still present in CETA as a result. If an MEP tries to tell you that corporate courts in CETA has been ‘fixed’ by ICS, then they’re not doing their job properly – all that’s happened is that they’ve put lipstick on a particularly controversial and unpopular pig.

8. It’s not a free trade agreement, it’s a corporate charter

Many including myself use the short hand of referring to CETA as a trade or free trade agreement. Most tariffs on imports will be removed apart from a small proportion of agricultural products (notably poultry and eggs). But the main controversies and the core of CETA is about the introduction of the corporate courts and removing ‘non-tariff barriers to trade’. Removing non-tariff barriers to trade sounds a bit boring or innocuous, but what it mainly means in practice is stripping away all the consumer protections around the food we eat, the chemicals companies use and so on. This is classic ‘race to the bottom’ stuff, where whoever has the lower standards, gets to impose them on the consumers and citizens of the other trading block.

This is not really about trade at all, this is a corporate power grab, we need to call it so.

9. Workers’ rights – lip service only

There are some lovely words about protecting workers’ rights in CETA. But if a country or company goes against the ideals of these provisions, then the knee-trembling threat that they would have to face would be non-binding discussions and recommendations. It’s not a threat that profit-driven entities will find much to worry them. The teeth in CETA are biting the wrong people.

10. Democracy

CETA was negotiated in even more secrecy than TTIP, there was no scrutiny at any level of democracy before the text was published (hurriedly, after it was leaked). There has been barely a chance to amend the text and will be presented to European parliamentarians as an ‘all or nothing’ choice.

This is not what democracy looks like.

>>> Take action now: ask your Member of Parliament (MEP) to stop CETA


*CETA stands for Comprehensive Economic and Trade Agreement