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Free Trade Agreement: Special Rights for Corporations
The TTIP (Transatlantic Trade and Investment Partnership) negotiated in secret gives corporations the right to sue sovereign states for lost profits and endangers public sector jobs and social and environmental protections.
FREE TRADE AGREEMENT
Special Rights for Corporations
By Southwest German Radio
[This radio transcript from 6/11/2014 is translated from the German on the Internet, http://www.daserste.de.]
The planned free trade agreement between the US and the EU earmarks arbitration courts that make final decisions for disputes between businesses and state boards. Suits in the billions imperil Germany. An American firm sues the Federal Republic of Germany for compensation because a chemical plant cannot be built… Baden-Wurttemberg gives way out of worry of a lawsuit in the billions. Monsanto may grow genetic corn in the country… US corporations could sue the German state for billions of the money of taxpayers. That could soon be reality. There are already other cases now.
Like Krummel near Hamburg, the Brunsbuttel nuclear power plant in Schleswig-Holstein was shut down after the reactor accident in Fukushima. The German nuclear exit was resolved by the government and the parliament and supported by the large majority of Germans. Nevertheless the Swedish firm Vattenfall, operator of the plants, sues Germany for compensation (3.7 billion Euros) before a secret international court of arbitration, not a regular German court. Three private economic lawyers make legally binding decisions while the public is excluded.
“They open up a parallel course of law for a corporation to which only they have access. The legal system that we have has nothing to do with the rule of law principles that are known and esteemed like independence of the administration of justice.” Pia Eberhardt, trade expert (CEO). This is because companies like Vattenfall enjoy special rights. The foundation is a so-called investor-protection agreement.
Germany has concluded over 130 such agreements. Originally businesses were protected from arbitrary expropriations as in countries without a functioning constitutional state or dictatorships. However not much is left of that, says Pia Eberhardt of the critical lobby organization CEO.
“The system has actually changed very much. Complaints today do not generally focus on direct expropriation on the taking away of a factor or land, discrimination against foreign investors. Today democratic laws to protect the public interest are attacked. In other words, language and democracy are completely mutated or turned upside down.”
So the cigarette giant Philip Morris sues Australia to prevent the planned warnings on cigarette packages. A US energy firm demands compensation of a billion Euros from France because its drilling license for natural gas was cancelled. Deutsche Bank sues Spain because the country cut solar subsidies. The bank speculated in new plants. All this happens before courts of arbitration that work completely non-transparently, experts criticize.
“We have problems with transparency. No rule says investor-state arbitral proceedings must take place publically. While some occur publically, most do not. There is no basic rule on publication of arbitral awards.” Prof. Steffan Hindelang, constitutional lawyer, Free University of Berlin. The number of these non-transparent procedures increases. In 1995 there were only three such procedures in the billions worldwide. In 2013 there were 568 procedures. American companies suing states were prominent.
Until now these companies could not sue Germany before a court of arbitration. This could change through the planned free trade agreement between the US and the EU with comprehensive investor protection rights for American companies.
An example from Lower Saxony shows what this could mean concretely.
The American energy giant ExxonMobil drills here for natural gas and uses the controversial fracking. With fracking, rock is burst open with the help of water and chemicals to gain natural gas. The method is regarded as very dangerous; the groundwater can be contaminated through the chemicals. This is already happening in the US and triggers massive resistance.
“That we want to protect our water is most important. 340,000 people are affected here… Exxon and the other gas producers want to squeeze the last gas from the earth through fracking.” Hartmut Horn, Botersen citizen initiative “Frackless gas drilling in Rotenburg district.”
Their protest could be very expensive for taxpayers through the planned investor protection since ExxonMobil has a drillingt license. If the state sets strict drinking water conditions or prohibits fracking, Exxon could sue for damages in the future in a court of arbitration.
“I can argue as an investor I was not treated fairly and justly. My legitimate expectation that I could frack to all eternity was disappointed. A court of arbitration could understand that argument and then say here is a billion Euros compensation that a license was taken away from you for example.” Pia Eberhardt, trade expert/ Corporate Europe Observatory (CEO)
A BOUNDLESS BUSINESS?
Just the fear of suits in the billions could influence German politics to renounce on new environmental- and consumer conditions.
“The higher the compensation demands, the more a state is obviously inclined to reflect about corresponding legal measures again.” Prof. Steffan Hindeland, law professor at the Free University of Berlin
Remember, investor-protection was originally intent on protecting businesses in developing countries and dictatorships, not for functioning legal states like the US and Germany.
“We do not need any parallel structures when national courts can make decisions according to neutral and unbiased objective criteria.” Prof. Steffan Hindelang, law professor, Free University of Berlin. Thus investor-protection and backroom deals as in the free trade agreement are undemocratic and unnecessary.
US POLITICIANS CONSIDER A “TAX HOLIDAY”
Senators on republican and democratic sides are now working on a deal so US super-companies can bring back money bunkered abroad to their home cheaply. Apple chief Tim Cook did his utmost for that.
A large part of Apple’s $150 billion in cash resources is stored abroad. The 35 percent business tax would arise if the company returned the sum to its home, the US. The amou9nt would not be so high after an alliance of several democratic and republican senators. One republican tax lobbyist said a revival of the 5.25 percent paid during a similar tax holiday in 2004 is possible. (source: heise newsticker)
FREE TRADE AGREEMENT QUO VADIS?
By George Restle
[This short facebook blog and comments published on 5/15/2014 are translated from the German on the Internet, https://www.facebook.com/monitor.]
In Europe there will be elections next week (May 26)… Facts are created across the Atlantic. Next week the EU commission will be negotiating the free trade agreement with the US. The fifth round of secret negotiations will occur in the provincial town Arlington. Much is at stake: telecommunications and protection of the atmosphere, work, energy and copyright law. The agreement involves investments and regulation questions, the public employment system and trade with goods and services. Whoever looks at next week’s agenda could ask: what is not at stake? That is the point. The mandate for the negotiations is boundless. Whatever is not explicitly excluded can be treated – and in case of doubt regulated.
Several things come to us through the backdoor of the TTIP. Principles are involved and not only chlorinated chicken and hormone beef, the privatization of whole sectors of public services. Central institutions of our society threaten to become playthings of the open market: universities, hospitals, savings banks and local public transportation. Even the basic values of democracy do not seem secure any more: constitutional state and transparency, citizen participation and parliamentary oversight. Everything becomes reduced to only trade barriers in the intellectual world of free trade ideologues. The gibberish or jargon of the new transparency offensive cannot be trusted. Even if investment protection were suspended, the controversial arbitration courts will still come. Nothing seems safe anymore before the clique of the big corporations. The free trade agreement is an attack on our democracy and is more than an attack on environmental- and social standards. That should be clear to everyone.
Muchacho Smith: The Transatlantic Free Trade agreement (TTIP) is a coup de-etat in slow motion!
Mecki Drees: What has now become of democracy? I feel like I’m in the 52nd state of the US.
Michael Mechtold: Unrest will begin in one country and trigger an extensive Europe-wide fire. After the elections, Brussels will show its true grotesque face. This will not be pleasant for us. I am very worried.
Uwe Meier: “Everything comes into question EXCEPT rightwing parties!”
Domingos Celsio Patricio: I recommend voting for the Left party (Die Linke) in Germany.
Dagmar Gawronski: Facts are created and forced on citizens. Is that democracy?
Andarle Sodarle: The EU now has the possibility of being made a slave after being made a prostitute. It will not be able to escape this. The US goes down and obviously would like to take along as many as possible.
Karin Kauzlaric: A swarm of overpaid twits sit in the EU. Recipients of orders from the US. Ms. Merkel and Mr. Steinmeier are the model students of the US.
Marsu Polami: TISA is at least as bad as the free trade agreement TTIP.
Hubert Hoffmann: We CITIZENS are raped and incapacitated by POLITICS. Time for street fighting!
Michel Goedecke: The main point is people vote for this black plague. They want to be Christians!
Axel Weber: TTIP is a dangerous brazen attack on our social-democratic basic values… Americans want to bomb us back into the proverbial pre-industrial slavery. Look at their totally ruined country!
Lutz Romahn: Momentous decisions are made over the heads of the affected! What does this have to do with democracy?
Karin Johnson: The big conglomerates are determined to get everything… Society pays for this, not only with its taxes.
Andrea Klinkhart: Yesterday Ann Will spoke about an agreement with Canada that serves as a model. That should be thematicized.
Angela Heumann: None of the EU oligarchs wanted to admit what was resolved long ago and was actually negotiated. Oligarchs act that way!
Gabriele Dominiak: Monsanto sends its regards! If this happens… then good night!!
Erik Schuler:What is the TISA?
Andy van den Unartigen: This is not secret any more. Citizens do not want this and yet it will come to them. Excuse me, I forgot, when are the citizens interested?
Andrea V. Earthling: Thanks Monitor for not being intimidated from reporting the truth!
Bernhard Wessling: We must leave the EU!!!! Europe can function without these lobbyists!
Rudolf Kapp: These Americans are smashing the whole world!
George Parker: When will the nations get the message about what is wrong? I recommend the book by Naomi Klein: Shock Therapy. Everything is there.
Marcel Fuhr: There will be worry and foreboding!
Sylvia Koepen: The usurpation is fully underway.
Michael Lips: We cannot prevent it as citizens because it is all the same shit to the masses. Political weariness is the decreed state education program!
Michael Fritz: I vote for one of the small parties. This is “only” to express my displeasure… I do not want established politics any more… No vote is in vain.
Ulrich Hohmann: On May 26 we could all vote for a party that opposed the TTIP! We cannot set a clearer sign!
Elke Windemuth: This makes me infinitely furious. When is there a demonstration against this? My rage must go somewhere.
Thomas Samoht: I am an ardent European. Therefore I am against the EU in Brussels!
Michael Gunther: We all have responsibility that our incompetent highhanded politicians driven past the people by lobbyists do not suspend our democratic values. Some time after the EU election, Merkel and her failure will sell us out again since there is allegedly no alternative. Let us all say STOP!
Michael Greten: If the agreements had not been leaked out, we would not even know what Merkel and Obomba wanted to negotiate very secretly… without parliament and without the people – democracy a la Western!!!
Fritz Wert: Democracy worldwide is in retreat.
Martin Grasser: We have the problem today that our politics does not resist international corporations. We need an institution like the UN to say a little word. Social misuse occurs regularly when subsidies are cancelled and shortly thereafter relief works are closed.
more at http://www.alternativetrademandate.org, http://www.citizen.org and http://www.progressive-economics.ca