Enquiry into risks of US-EU free trade agreement

6 December 2013

Enquiry into risks of US-EU free trade agreement

Following majority support in the Dutch national Parliament for a motion jointly proposed by the country’s three left of centre parties – Green Left, the PvdA (Labour Party) and the SP - an official enquiry will be conducted into the risks of the proposed free trade treaty between the United States and the European Union.

Commenting on the development, SP Member of Parliament Jasper van Dijk said: ‘This free trade agreement has already been termed a frontal attack on democracy. It would mean that multinationals would be able, outside normal legal procedures, to lodge claims against countries regarding profits that they could lose out on in the future. Things can’t get much crazier.’

The enquiry will be aimed at bringing to light the financial and social risks of so-called “investor protection agreements”. These agreements would oblige states to give foreign corporations investing in their countries the right to “fair and equitable treatment”. The protection proposed in the treaty with the US, however, goes in the view of the SP and of many social organisations much too far. Corporations could, via a disputes panel, or perhaps via the existing system of Investor-State Dispute Settlements (ISDS), bring complaints against state authorities without this resulting in a court hearing before a judge. The trial would take place instead behind closed doors and this could, according to critics, result in enormous restrictions on the freedom of governments to determine policy.

‘A well-known example,’ says Van Dijk, ‘concerns the decision of the German government to close eight nuclear power stations in the wake of the Fukushima disaster. Energy corporation Vattenfall rebelled and demanded € 3.7 billion in compensation because of foregone future profits. “Fair and equitable” appear to be somewhat elastic concepts that can inflict a great deal of damage on countries. This represents in addition a serious threat to national sovereignty.’

SP Euro-MP Dennis de Jong added that ‘the proposed trade agreement goes even further, making the US and EU into a real free trade zone. This forms a major threat to our social rights. That’s why I’m involved in establishing an alternative trade mandate by which social organisation from Europe are attempting to prevent this sort of free trade agreement.’

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