Enforcing environmental rules in trade deals ‘as important as commercial rules’

October 30, 2017

An enforceable set of sustainable development requirements should be written into all free trade agreements that the EU concludes. That is the recommendation from a paper by T&E which draws on research conducted two years ago when discussions on the ‘TTIP’ EU-US trade deal were at their height.

The EU negotiates various free trade agreements with countries and blocs around the world, and because sustainable development is one of the EU’s essential goals and a guiding principle behind all EU policies, trade and sustainable development (TSD) ‘chapters’ are now part of most agreements.

However, these chapters have little impact because the measures in them are not enforceable. If a country or bloc does not comply with the TSD chapter of a trade deal with the EU, there are no consequences. In July, the European trade commission Cecilia Malmström began a consultation on how to change this.

As part of this consultation, T&E has now published Trade and Sustainable Development: a chance for innovative thinking, a short paper proposing ways of making the requirements of TSD chapters mandatory. Its principal recommendation is that any violations of environmental protections in EU trade agreements should be subject to the same state-to-state dispute settlement as violations of the commercial clauses. The new generation of EU trade agreements currently excludes the use of state-to-state dispute settlement for the sustainable development chapters.

T&E’s trade director Cécile Toubeau said: ‘Access to commercial markets must be made conditional on the EU and its trade partners implementing and adhering to the environmental requirements set out in the bilateral free trade agreements. We must have a situation where if trade partners don’t comply, they don’t get access.’

In October 2015, T&E and the lawyers’ NGO ClientEarth published a report which examined how to include progressive policies in the then EU-US negotiations to create a Transatlantic Trade and Investment Partnership (TTIP). Much of the thinking that went into that report has been refreshed for this report as it is valid for TSD chapters in all bilateral agreements.

Among the other recommendations in Trade and Sustainable Development are that the World Trade Organisation’s anti-dumping agreement should be reformed to include UN sustainable development goals including climate change criteria, and that other EU trade reforms should include environmental criteria such as contribution to climate change, land use, water and air quality. It also proposes a scorecard for the EU’s developing trade partners to ensure that they engage with and implement international environmental agreements such as the Paris climate agreement, the result of which would be published annually.

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