Ed's Blog

Debating trade and consumer protection in Brussels today

By Ed Mierzwinski
Consumer Program Director

 
Today in Brussels I am part of a public forum organized by the PIRG-backed TransAtlantic Consumer Dialogue to debate the impact of the pending TTIP trade agreement on consumer and environmental protection with senior US and European Union officials, along with academics and business leaders. A key item is whether the treaty will include a provision called Investor-State-Dispute-Resolution-System (ISDS) giving corporations the right to challenge health and safety laws as trade barriers, in secretive tribunals outside the court system. Also, tomorrow I speak at a followup event comparing the CFPB to European financial regulatory models. (Apologies, some technical difficulty is requiring me to add the links directly).
 
The event today is called "TACD MultiStakeholder Forum: The precautionary principle in TTIP: Trade barrier or essential for consumer protection? http://tacd.org/event/2016-annual-forum/
TACD’s view is that US consumers are like European consumers. We all want privacy (but European law is better and European enforcement against Google et al is better), we all want chemical safety (but European law is better) and we all want safe food free of antibiotics and genetically-modified organisms (European laws on GMO labeling are ubiquitous across the continent and a few countries fully ban GMOs; we have only a VPIRG-backed Vermont law due to take effect but under attack in Congress).Archive of TACD statements on TTIP: http://tacd.org/topics/policy/ttip/   

Two issues dominate our concerns about the treaty. The first is an elephant in the room and is known as Investor-State-Dispute-Resolution-System (ISDS). The second is whether the safety-first “precautionary principle” that applies across all European health and safety regulation and most, but not all US rules, will be undercut by the treaty.  

 Why ISDS Should Not Be Included In Any Trade Treaty: ISDS was originally created years ago as an alternative legal remedy to give investors confidence that when they invested in a lesser-developed country without a viable court system, that they could still sue to protect their assets. Now, we look at it as yet another vehicle for powerful special interests to challenge health and safety and other consumer protection laws as trade barriers. Lack of a robust court system is not a problem in either the US or the EU. There is no reason to include it in TTIP. The European Commission, the administrative arm of the EU, recognizes some of our concerns and has proposed an alternative called an International Court System.
 
But as my colleague Ira Rheingold of the National Association of Consumer Advocates argued forcefully earlier: “You can put lipstick on a pig, but it’s still a pig.” TACD makes our more detailed policy arguments in this new ICS paper:  http://tacd.org/response-to-the-eu-commissions-investor-state-dispute-se...
 
Regulated corporations already have a phalanx of lawyers and numerous legal and regulatory venues to challenge consumer protection laws and rules. They don’t need another one, especially one that gives them a secretive, extra-legal tribunal where their rights are essentially elevated to those of sovereign nations. Instead of making consumer and corporate rights more balanced, TTIP with ISDS or ICS would give corporations yet another weapon against strong state and federal laws.
 
Precautionary Principle: All consumer and environmental groups believe strongly that we shouldn’t allow the use of new chemicals, new prescription drugs or new processes until they have been proven safe. Industry would prefer the opposite: use unless they are demonstrated to be harmful. Most European and US laws now operate under a “Err on the safety side” or precautionary principle. For example, the US Food and Drug Administration requires extensive testing of new drug safety. 
 
One glaring flaw in US law is its Toxic Substances Control Act, which is about to be upgraded somewhat by Congress, but as my USPIRG colleague Carli Jensen points out, not upgraded enough. http://www.uspirg.org/blogs/blog/usp/our-take-toxics-build-stronger-hous...
 
Europe’s REACH Act on chemical safety is much better. While Cecilia Malmström, EU Trade Commissioner argued strongly today on her panel that “We are not negotiating REACH in TTIP,” we at TACD remain concerned that TTIP does contain chemical safety provisions.
 
Especially if TTIP includes ISDS/ICS, all laws including REACH that are based on the precautionary principle are at risk. While, after a hard slog, tobacco control groups succeeded in removing tobacco from the ISDS provisions of the recent  Trans Pacific Partnership (TPP) (see the end of this Public Citizen TPP release which explains that the tobacco carveout is the “only meaningful new ISDS safeguard” http://www.citizen.org/documents/NAFTA-ISDS-KeystoneXL-Statement.pdf
Good for tobacco control and we support it, but instead, why not protect all health and safety laws by keeping them out of the full scope of entire trade agreements?

 
It’s been a good forum. Other keynote speakers include Ignacio Garcia Bercero, EU Chief TTIP Negotiator, DG Trade, European Commission; Julie Brill, an FTC Commissioner and privacy expert; and Michael Punke, deputy U.S. Trade Representative (he is perhaps now more well known as the author of the book The Revenant, but the US says he cannot talk about it or the new movie).
 
In her remarks, my fellow TACD Steering Committee co-chair Monique Goyens, Director-General of BEUC (the European Consumer Organization at http://www.beuc.eu) pointed out that she has been outraged by the general characterization of consumer laws as a “trade irritant.” By the way, BEUC works on many of the issues we work on, including holding VW accountable for the diesel pollution scandal. Other groups here include Public Citizen, Consumer Reports, the Danish Consumer Organization and many more. 
 
Consumer groups support improving economies and creating jobs, the nominal goals of trade treaties. But trade treaties that do not also elevate the lives of the public and make them more confident that the products that they buy will keep their families safe from harm are fatally flawed.
 
Tomorrow I speak at a second TACD forum: “Regulatory responses to the global financial crisis in the EU and US: implementation and enforcement of retail financial services regulation.” It will include participation of consumer and civil society representatives as well as relevant government officials, including from the CFPB, and will include a comparison of the CFPB to European financial regulatory models. The event is at EU Parliament and will be web-streamed between about 9am-noon US Eastern Time, if I did my time zone calculation correctly! Link to event and webstream: http://tacd.org/event/financial-services-2016/

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