European Parliament Approves TTIP Compromise

09.07.2015 -

By a vote of 447 to 229, the European Parliament (EP) on Jul. 8 approved a compromise resolution worked out by its international trade committee in an effort to make the Transatlantic Trade and Investment Partnership (TTIP) more palatable to a skeptical European public.

In the same plenary session, the Parliament signaled its willingness to proceed with the negotiations, which have sagged of late. On this issue, the vote was 436 to 241.

A vote on the resolution in support of having industrial disputes arbitrated by public courts rather than private tribunals – originally scheduled for Jun. 9 – was postponed at the 11th hour due to a flood of complaints against or amendments to the proposed compromise.

Under the EP’s conflict resolution plan, which closely follows guidelines presented by European Trade Commissioner Cecilia Malmstrom in May of this year, the arbitration courts would be staffed by publicly appointed, independent professional judges, and hearings would be open to the public, rather than private.

Commenting on the Parliament’s decision, Malmstrom said her “urgent task” as negotiator in the months ahead will be to bring about an “ambitious, comprehensive and balanced agreement which demonstrably delivers jobs and growth in Europe and will obtain democratic backing.”

The EP has the power to reject any final TTIP agreement.

While the US has made arbitration of disputes a key condition of the trade agreement, European skeptics fear this would allow US multinational companies to challenge European food and environmental laws on grounds they restrict commerce.

To the disappointment of European chemical producers, the so-called Investor-State Dispute Settlement (ISDS) mechanism earlier had been excluded from negotiations in an effort to speed up the talks.

Following the EP vote, interest groups on both sides of the ISDS issue remained especially critical. The German chemical industry association VCI – Europe’s largest producers’ grouping – criticized the EP’s position that the EU’s REACh legislation could be excluded from the regulatory cooperation with the US.

VCI general manager Utz Tillmann said exempting REACh “would make any kind of regulatory cooperation in the chemicals sector nearly impossible” and lead to unnecessary duplication and cost. Lowering safety standards, as some TTIP opponents suggest, was never the intent, he stressed.

While EP president Martin Schulz said the ISDS compromise version provided for a transparent body to rule on disputes, the Green parliamentary faction said it still allowed foreign investors to use a separate layer of jurisdiction, other than the domestic legal system.

German environmental advocacy group BUND, an affiliate of Friends of the Earth, said the MEPs were bowing to industry by failing to draw a line on what is acceptable. In its view, the Parliament should have rejected the ISDS mechanism altogether.

BUND has called for an anti-TTIP rally in Berlin on Oct. 10.