CETA put into effect – an affront to democracy

by Jacques Sapir*, France

The free trade agreement between the European Union and Canada, CETA (Comprehensive Economic and Trade Agreement), was put into effect on 21 September 2017. It is an eloquent testimony to the fact that the EU Member States have allowed their sovereignty to be taken away from them.  New laws are implemented, which are above their own legislation and not subject to any democratic control.

Protection for big private investors

CETA is a so-called “free trade agreement”. But in fact, it challenges the non-tariff measures which various EU states can take to protect their populations from unhealthy food. There is a risk that with CETA these safety requirements will find itself more and more under pressure. This agreement also establishes investment protection rules that entail major hazards. Namely, it includes a clause introducing an arbitration court to protect large private investors [usually multilateral enterprises investing in a foreign country; Ed.] which makes it possible to take legal action against the decision of a single state (or the EU) in case it jeopardises „legitimate expectations on the profitability of the investment“. Therefore, it is a mechanism called the “ISDS clause” (Investor-state dispute settlement, Ed.) which primarily serves to protect future profits of investors. This mechanism is a one-way street. In this system a state cannot take measures against a private enterprise, but only the other way round. Therefore, it should be noted that CETA will allow investors to appeal political decisions if they are of the opinion that they are violating their interests. This process, which can prove very expensive for the states, will have already a deterrent effect in the case of the mere threat of a legal trial. Let us recall that in 2011 Quebec shied away from forbidding the component of a certain herbicide on the grounds of its carcinogenic effect, because Dow Chemical, which marketed the herbicide, decided to bring this case to court.
There is also the bias problem. It may be true that this treaty opens up access to public procurement in Canada to European enterprises. In fact, however, the EU market is already open for Canadian companies [via the WTO, Ed]. One glance at the different numbers of inhabitants will tell who the winner is. (Canada 37 million, EU 512 million). Furthermore, we are faced with the fundamental emphasis on free trade or, more precisely, the peculiar interpretation of free trade contained in this agreement. It turns out that this is always biased towards the interests of multinational enterprises, which by no means comply with the interests of consumers and workers.

CETA includes a genuine democratic-political problem

Therefore, the dangers that CETA involves, concern public health and quite obviously sovereignty. It also threatens democracy. When, after a long pause and twisting and turning, the European Parliament voted, the French deputies of four political groups voted against, Front de Gauche [Left Front], EELV [The Greens], the Socialist Party and the Front National. An alliance which is not so strange after all, if one recognises the problems which this agreement entails. Actually, it is worth noting that CETA was rejected by the delegations from three of the six founding countries of the European Economic Community (EEC) as well as by the second and third largest economic power of the Euro countries. Nonetheless, this Treaty was ratified by the EU Parliament on 15 February 2017. It has, however, still to be ratified by 38 national and regional parliaments within the EU. Even so, it is already considered to be partially applicable. On 21 September 2017, CETA was provisionally put into effect. This applies to areas where the EU is solely responsible. The areas where the consent of the Member States is also necessary are temporarily suspended, such as the issue of arbitration or intellectual property. However, some 90% of the provisions of the Treaty can already be implemented, which represents a genuine democratic problem. In addition, if a state was still to refuse the ratification of CETA now, it would have to be implemented for three years anyhow. It is clear here that everything has been done to formulate and apply this treaty, regardless of the peoples’ will.
This agreement is in no way equivalent to what is usually referred to as a “free trade agreement”. Essentially, this is a treaty which imposes the norms defined by the multinational companies on the parliaments of the EU Member States. If someone had wanted to show the deepest antidemocratic nature of the EU, he would have had to take the same way.
In view of these facts, the advocates of this Treaty are faced with a considerable problem in terms of democracy and legality. In France, it is known that only one of the presidential candidates, namely Emmanuel Macron, has spoken openly in favour of CETA. Jean-Marie Cavada, one of his most important supporters, has also voted in the EU Parliament to adopt this agreement. Hence, not for the first time in our history one might be reminded by the course of these presidential elections of what Jacques Chirac in his time (to be precise, on 6 December 1978) denounced as the “parti des étrangers” (party of foreigners) in his “Appel de Cochin” (named after the same hospital in Paris, where he was staying at the time)…1

Becoming aware of the dangers of CETA

Nicolas Hulot, before being appointed Environment Minister in the government of Edouard Philippe under Emmanuel Macron, had made a very clear statement against CETA. In view of this situation, his staying in government means a betrayal of his convictions. On 22 September, the Minister for Ecological and Solidar Transition (sic) expressed his disappointment of the agreement taking effect in a radio broadcast on Europe 1. He also admitted that the evaluation committee nominated by Prime Minister Edouard Philippe in July had identified several potential risks in the CETA. But Hulot added, “The process had already gone so far that it would have been difficult to stop its taking effect – without a diplomatic conflict being triggered with Canada, which we did not want.” The irreversibility mechanism deliberately incorporated into this agreement cannot be demonstrated any better. Let us also remember that the former TV announcer and environmentalist, prior to being appointed Minister for the Ecological Transition, repeatedly expressed that CETA was not “climate-compatible”. Thus, one can easily imagine the size of the toad he had to swallow in this matter ...
Since his election, Emmanuel Macron has also presented himself as a defender of ecology and our planet by topping Donald Trump’s slogan, altering it to “Make the Planet Great Again”. He has reiterated this statement, be it at the United Nations or on occasion of his journey to the Antilles after hurricane “Irma”. However, it is important to note that his commitment to CETA and his readiness to comply with the rules of the European Union, having been severely delayed because of the issue of hormone-active substances [or “endocrine disrupters”], clearly demonstrates that he uses ecology only as a pretext to show off some communication effects of the most appalling kind.
It is crucial to be aware of the scope of the implementation of CETA and its dangers to national sovereignty, democracy and security of the country.     •

* Jacques Sapir, born in 1954, is a French economist. He has taught at the University of Paris-X Nanterre. Since 1996 he has been a director of the EHESS (Ecole des hautes études en sciences sociales) and has been heading the CEMI (Center d‘études des modes d‘industrialisation). He is an expert in Russian business and strategic issues. Since 2016 he is (foreign) member of the Russian Academy of Sciences. He is the author of a variety of books and articles.

1    Haegel, Florence. Mémoire, héritage, filiation: Dire le gaullisme et se dire gaulliste au RPR, In: Revue française de science politique, vol. 40, no. 6, 1990, p. 875

Source: Russeurope from 22.9.2017

(Translation Current Concerns)