Some 97% of the almost 150,000 responses – a record in the history of European public consultation – opposed ISDS altogether, according to initial calculations, while less than 3% supported the European Commission’s agenda of including and reforming investor protection.
In early 2014, the European Commission invited submissions on the inclusion in the Transatlantic Trade and Investment Partnership (TTIP) of ISDS clauses which allow businesses to bypass national court systems and sue governments directly, in special private arbitration panels. Businesses could sue over measures that can jeopardise future profits – typically laws designed to protect the public. ISDS cases have trebled over the last decade.
Commenting on the consultation, EU trade commissioner Cecilia Malmström (pictured) said: “The consultation clearly shows that there is a huge scepticism against the ISDS instrument. We need to have an open and frank discussion about investment protection and ISDS in TTIP with EU governments, with the European Parliament and civil society before launching any policy recommendations in this area.”
However, the European Environmental Bureau (EEB) and T&E, which were asked by the Commission to join its TTIP advisory group in 2014, said that the opposition to ISDS was effectively being disregarded by the Commission on technical grounds.
In its report, the Commission said that around 145,000 responses were submitted through on-line platforms of interest groups, containing “pre-defined, negative answers”.
Jos Dings, T&E’s director and member of the EU’s TTIP advisory group, said: “Despite the overwhelming call on the Commission to drop ISDS, it has obscured the true extent of opposition in order to ram through its agenda to reform the unreformable. Commissioner Malmström wants to make a fresh start on trade but she has just made a false one.”
Currently, US investment in the EU is three times greater than with the whole of Asia. 19 out of 28 member states, representing 93% of the EU economy, currently do not offer ISDS protection to US investors. To date there are nine known claims in EU-US trade relations, all of them led by US investors.
Pieter de Pous, EEB’s EU policy director and member of the EU’s TTIP advisory group, said: “The EU and US have well-developed legal systems which have more than adequately handled foreign direct investment until now. ISDS would only lead to the erosion of laws that deliver public benefits, notably those that protect consumers’ and workers’ rights and the environment.”
The Commission says it will soon organise a number of consultation meetings with EU governments, the Parliament, and various stakeholders to discuss investment protection in TTIP on the basis of its consultation report. It’s thought that the Commission aims to have a final position on ISDS by July, ahead of the summer recess.