Posted on October 14, 2016 at 02:28 PM

Rosa Crawford, TUC Policy Officer
Rosa Crawford, TUC Policy Officer

UPDATED Oct 28:  An agreement between the Belgian government and the regional Wallonian parliament removed the last obstacle to the official signing of the CETA trade deal between Belgium and Canada, which took place on October 30. The last minute agreement appears to make some concessions to the Wallonian parliament, particularly on the controversial ISDS 'secret court' system for investors (see below).  The CETA deal will come into force on a temporary basis ('provisional application'). 

To become a permanent legal document, the deal must now be ratified by some 38 national and regional parliaments across the EU. The ETUC and the Canadian Labour Conference (CLC) have jointly called on the EU and Canada to "restart a transparent negotiating process aimed at introducing in CETA binding and enforceable provisions" on the ISDS system and labour standards. 

In advance of the latest controversry, the EU and Canada developed a joint declaration (now called a 'joint interpretative instrument') on CETA that puported to address key concerns about the deal. However, as Rosa Crawford of the TUC points out, the reality is substantially different. 


A recently-leaked document has revealed how authorities in the European Union (EU) and Canada hoped to deflect opposition to the proposed CETA EU-Canada trade deal.

The leaked ‘joint interpretive declaration’ will function as an ‘add-on’ to the agreement.

The joint declaration was designed to convince countries and concerned constituencies  –  of which trade unions are a large part –  that CETA won’t threaten our public services, existing labour standards, the environment or even state sovereignty.

Germany’s social democratic SPD party has stated that it could only support an agreement that contained adequate protection in these key areas.

In Ireland, the Seanad recently voted to support a motion demanding government should not sign up to or support the CETA deal.  

There have also been calls for a full Dail debate on CETA before it is signed.

Even before the declaration was released questions were raised as to whether any side document added to a trade agreement carried any legal weight, an issue Greenpeace and others have highlighted. The environmental body described the declaration as having the “legal weight of a holiday brochure.”

In fact, the text falls far short of what is needed to change CETA to provide adequate protection for workers and society.

Aside from the fact that the declaration carries no weight, there are four key areas in which it fails to make necessary changes to CETA.


1. Public Services

Change to CETA that is needed: a full exclusion for public services from the agreement. The suggested wording for this has been provided in a report produced by EPSU and AK.

What the declaration gives us: a statement that CETA won’t prevent governments from regulating or renationalising public services.  This doesn’t change the fact that a number of public services continue to be listed in the agreement, which means they will be exposed to liberalisation commitments through the deal. Any action by a government to regulate or change the funding of these services may result in a legal challenge for breaching their commitments under CETA.

As we’ve pointed out previously, combined with the Investment Court System (see below) this is likely to create a ‘chilling effect’ where governments don’t pursue certain policies and choose not to renationalise public services for fear of being challenged for breaching the terms of the trade agreement.


2. Investment Protection

Change to CETA that is needed: all special courts for foreign investors removed.

What the declaration gives us: a statement that confidently claims “CETA won’t result in foreign investors being treated more favourably than domestic investors.” However, this is impossible to square with the fact that CETA contains the Investment Court System - a special court system expressly designed to give foreign investors more rights than domestic investors to sue governments, if the latter act or regulate in a way that can be interpreted as ‘indirectly expropriating’ the investment.

We know from previous experience that indirect expropriation could mean a government increasing the minimum wage or preventing companies from dumping toxic waste in water supplies. The only potential useful addition here is a commitment to avoid misinterpretation of ICS tribunals and monitoring where rules may be misused.


3. Labour Standards

Change to CETA that is needed: a sanction added that could be triggered when labour standards are violated.

What the declaration gives us: a statement that workers’ rights will be respected. This means there will be no penalty if EU members or Canada fail to respect workers’ rights. The declaration also states there will be a mechanism to review the impact of CETA on workers that would involve trade unions. While trade unions are ready to be part of any review mechanism it would need to provide unions with the ability to trigger investigations into labour rights abuses and corrective action to be taken by governments and employers. Unfortunately, our experience to date of labour rights review mechanisms in existing trade agreements - such as those with South Korea and Colombia - is that trade unions have not been able to use them to get the European Commission to take action against trading partners even when egregious rights violation are taking place.


4. Health & Environmental Standards

Change to CETA that is needed: a clear commitment in the text to uphold the ‘precautionary principle’, which protects Europeans from health risks and dangers to the environment.

What the declaration gives us: a statement that CETA will protect the environment, but no improvement on the watered down version of the precautionary principle contained in the agreement. This means it will be harder for governments to implement rules to protect us from hazards such as GM additives in food.

The declaration indicates that neither European Commission nor the Canadian government are prepared to seriously engage with concerns raised by trade unions and governments about CETA.

Rather than  a ‘gold standard agreement’, the declaration confirms the threats that CETA poses to public services, workers’ rights and governments’ ability to create laws and rules in the public interest.

Ministers, TDS, and MEPs and MPs need to say no to CETA and call for trade agreements (and for any Brexit deal) to be negotiated with the full involvement of trade unions to ensure they benefit working people.

Rosa Crawford is a TUC Policy Officer dealing with issues around trade and migration.

A version of this first appeared in the TUC’s Touchstone Blog




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