Sovereignty fears lead to EU-US trade rethink

By Oliver Wright, January 20,  2014

The European Commission is to rethink its approach to a controversial US trade deal which campaign groups have warned would fundamentally erode Britain’s sovereignty. 

Under the deal being negotiated by US and EU officials, multinational firms would be given wide-ranging powers to sue EU governments that adopt policies deemed to “discriminate” against free trade.

Groups including Greenpeace and the TUC have warned that the treaty’s provisions will have far-reaching consequences – limiting the UK’s freedom to tackle climate change, protect consumers or even guarantee a publicly run NHS.

In Australia, a similar trade deal with Hong Kong has resulted in the Government being sued by Philip Morris for introducing plain cigarette packaging.

In response to the concerns, the EU Trade Commissioner Karel De Gucht has written to the trade ministers of all 28 member states announcing a public consultation on the so-called investor-state dispute settlement (ISDS) part of the treaty. During the three-month consultation some parts of the treaty negotiations will be put on hold.

In the letter, a copy of which was passed to The Independent, Mr De Kucht admits that the provision is causing increasing concern across many EU states and proposes a pause to take stock of the objections.

“The widespread public messaging on the inclusion of investment protection and ISDS in the treaty has convinced me that it is necessary to allow for a public reflection about the way the EU should tackle these negotiations,” he writes. “I have therefore (decided) to launch a public consultation on the EU approach… (before) coming back to the Council to discuss and refine our approach.”

Green Party MP Caroline Lucas said she was pleased that parts of the treaty were being reassessed. “The European Commission is handing massive powers to multinational corporations, so it’s welcome that members of the public are finally being allowed a say,” she said.