French Senate tells TTIP negotiators to ‘abolish’ ISDS

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EurActiv | 4 Feb 2015

French Senate tells TTIP negotiators to ‘abolish’ ISDS

Cécile Barbière
translated from French bySamuel White

The centre-right and the extreme left in the French Senate have joined forces to oppose the TTIP arbitration clause. France’s upper house unanimously adopted a resolution calling for the removal of the controversial text. EurActiv France reports.

The French Senate united on Tuesday (3 February) in its opposition to the Investor-State Dispute Settlement mechanism (ISDS).

Without far-reaching reforms to the mechanism, members of the French upper house will not support the transatlantic trade deal, which entered its eighth round of negotiations this week (2-6 February).

The different political groups all voted in favour of a proposal for a European resolution calling for the abandonment of the arbitration mechanism in a separate trade agreement with Canada, if substantial changes cannot be negotiated.

The non-binding text calls for the ISDS procedure to be modified "in order to ensure the complete transparency of debates and disclosure of proceedings, the independence and impartiality of arbitrators, and the effective establishment of a system of appeal against decisions before an independent tribunal".

ISDS is controversial, because it allows companies to take governments to international arbitration tribunals rather than to domestic courts. Critics say the clause would limit government’s ability to regulate in the public interest while supporters claim it is necessary for companies to obtain redress, especially in countries with weak judicial systems, where TTIP would set a precedent.

A new international court?

The resolution also proposes "allowing recourse to an international dispute settlement system for investments, based on the World Trade Organisation’s dispute settlement system".

André Gattolin, a Senator from the Greens group, said "the WTO has more balanced rules on dispute settlement".

Matthias Fekl, the French Secretary of State for Foreign Trade, called for "the creation of a permanent international court that could be based in Europe," charged with resolving disputes between investors and states. This would help to "redress the balance in favour of the states".

Radical solution

The last option listed in the proposal, and the most radical, is to "entirely abolish the dispute settlement mechanism for investments with Canada," included in the Comprehensive Economic and Trade Agreement (CETA) already negotiated with Ottawa last year.

This last option enjoys the support of the French government. "As you stated in your resolution, we do not have to include this mechanism in the international trade agreements," Matthias Fekl told the senate.

The Secretary of State has not ruled out making changes to the ISDS clause in the CETA agreement, which is due to be ratified in the first semester of 2015.

Negotiations between Brussels and Ottawa were officially concluded in September 2014, but the agreement has yet to pass through the European Parliament and the national parliaments of the 28 member states.

The resolution text, proposed by Senator Michel Billout, was discussed and adopted in the plenary session of the French Senate, while the high-stakes trade negotiations between the European Union and the United States resumed in Brussels.

The centre-right UMP Senator Jean-Baptiste Lemoyne said, "as we speak, the European and American delegations are negotiating TTIP, and the French people must show an interest now if they are to avoid waking up with a hangover".

Communist Senator Éric Bocquet said he had little hope for "a change of direction" during the eighth round of trade negotiations with the USA.

French Senate
Proposal for a resolution on investor-state dispute settlement in the planned trade agreements between the European Union, Canada and the United States (in French)
Report on the proposed resolution (in French)

source: EurActiv