'Huge scepticism' on US talks, EU trade chief admits

Trade commissioner Cecilia Malmstrom said that the volume of negative submissions had sent a “very clear signal” about public scepticism in the talks, adding that the investor protection provisions were “clearly something that a large number of European citizens are engaged with”.

Around 145,000 of the 150,000 submissions were submitted via a handful of NGOs which oppose the inclusion of ISDS.

Campaign groups Friends of the Earth Europe, AK EUROPA, Sum Of Us, 38 Degrees and the Munich Umwelt Institute collected more than 130,000 signatories between them.

Meanwhile, 3,000 individual citizens and over 450 organisations representing business groups, trade unions, consumer organisations, lawyers and academics also contributed submissions. Thirty-five percent of the submissions came from the UK, with Austrians contributing the second largest number.

Malmstrom replaced the Belgian Karel de Gucht as the bloc’s trade commissioner in October after telling MEPs that she was open minded on the issue. In his final weeks in office, De Gucht stated that it would be a “disaster” if ISDS was not included in the transatlantic trade and investment partnership (TTIP).

The EU executive opened the three-month online consultation last March and suspended discussions on ISDS with US trade officials.

The commission will not take a decision on whether to include ISDS until “the final phase of the negotiations,” and has not given up on including the mechanism in an agreement.

“It is too early to say what investor protection will look like in TTIP,” said Malmstrom. She added that the EU executive had “no specific deadline” to decide its next move but “by the spring we need to come up with a proposal on this”.

The commission has also stressed that investor protection and ISDS was included in the negotiating mandate given to it by governments in summer 2013.

Anti-TTIP campaign

The main concerns raised in the submissions focused on protecting governments’ right to regulate; how ISDS tribunals can operate in practice; the relationship between domestic judicial systems and ISDS tribunals; and the possible use of an appeal mechanism to revisit an ISDS decision

The trade talks have progressed since the first round in September 2013, with both sides tabling offers to remove almost all remaining tariff barriers and proposing to harmonise standards.

But the anti-TTIP campaign gathered strength over the course of 2014, and the status of investor protection clauses has become one of the most hotly disputed issues in the talks.

Critics say that ISDS could be used by companies to take legal action against governments if new regulation threatens their investments.

European governments have been forced to pay out at least €3.5 billion in compensation to firms since 1994, although a lack of publicly available information makes it likely that the actual figure is far higher.

Several of the most famous cases include the claim brought by Swedish firm Vattenfall against the German government over its move to decommission nuclear power plants, and US tobacco giant Philip Morris’s ongoing legal case against the Australian government over its bill introducing plain packaging for cigarettes.

The French and German governments have since indicated that investor protection can be guaranteed by their national courts, while several of the largest political groups in the European Parliament have vowed to oppose any trade agreement which includes ISDS.

Nonetheless, ISDS is included in over 1,400 investment treaties concluded by EU governments including nine with the US, and officials say that it exists to prevent discrimination and misappropriation by governments against foreign companies.

For their part, US officials have repeatedly stressed the importance of including ISDS.