The European Commission made public its proposal for a revamped ISDS (investor to state dispute settlement). German MEP Helmut Scholz, GUE/NGL coordinator on the International Trade Committee, denounced the proposal as an attempt to deceive the public.
“They call it ‘investment court system’, but in substance it simply remains an ISDS tribunal. Arbitrators are now called judges, but to qualify for the job it is enough to be a ‘jurist of recognised competence’ (article 9.4).”
“It is most regrettable that the Commission is ignoring citizen’s voices”, Mr Scholz continued, “considering that 97% of respondents to the Commission’s own consultation on ISDS clearly rejected ISDS”. Obviously, the Commission did not, or does not want to, understand the concerns.”
“In the proposed new ISDS system, three arbitrators continue to decide based on the words of the TTIP agreement, and not based on the words of our constitutions, or values agreed in the United Nations conventions. An obscure “Services and Investment Committee” shall decide on whether a case is to be established and what constitutes “fair and equitable treatment” (article 3.3).
Scholz stresses that it is important to define the meaning of the word ‘investment’. “People hear of investment and think about a nice guy building a factory next door, creating jobs. But what the Commission proposes goes way beyond that. Foreign investment shall be protected in the broadest definition, including purchase of stocks or a loan to an enterprise, or “any other kind of interest in an enterprise”. (para x2, b), d) and e) ). Concessions to search for, extract or exploit natural resources shall also be covered, probably much to the delight of the fracking industries.”
“The proposed new ISDS fails to recognise investor obligations. It does not provide an opportunity for citizens to sue an investor for polluting the environment, neglecting trade union rights, or destabilizing a currency.” the left wing MEP continued.
“Also, the system discriminates against local companies, as it is not open for their claims. Local companies would have to seek justice in the ordinary legal system, and that is precisely what foreign investors should have to do as well.”
Scholz did notice an impact of the strong public campaign against ISDS. “According to our own analysts, some elements of the new proposal are better than what we have in CETA. Still, the Commission explains that those changes will not apply to CETA. This means that the 40,000 US companies with offices in Canada will be able to use the CETA agreement to sue European governments.”
In a recent written response to a question of MEP Fabio De Masi, the Commission recognised that it has no evidence that an ISDS system is helping to attract investments. “So why does the Commission continue to try to establish ISDS? I assume that the main idea is to intimidate progressive legislative projects. This new ISDS deserves to be rejected, just like TTIP and CETA as a whole,” MEP Scholz concluded.