Transatlantic Trade and Investment Partnership — House of Commons, 2015-01-15
Topic: Foreign Trade
Zac Goldsmith (Conservative, Centre-right): I congratulate the hon. Member for Swansea West (Geraint Davies) on securing the debate TTIP, if it goes ahead, will be the biggest and boldest free trade agreement of all time. Like it or hate it, it is huge and it will impact on our constituents in any number of ways. It is therefore welcome that we are discussing it, albeit on the very margins of the parliamentary calendar, but we are nothing like as involved as we should be. If trends continue, we will find ourselves bound into a staggeringly far-reaching agreement without having given it anything like the kind of scrutiny it merits. We should be grateful to the public, both here and abroad, who have understood the significance of TTIP. Well over 1 million European citizens have signed a petition calling for, among other things, greater transparency. In response, the EU has reluctantly agreed to publish some, but not all, the texts relating to the TTIP negotiations. At this stage, no one can talk with any real certainty about the minutiae of TTIP—that is just not possible—but we can see the direction of travel. For my part, I think it is incredibly worrying The most obvious concern relates to the investor state dispute settlement mechanism, which has already been discussed. Up until a few days ago, it was an absolutely core component of the proposal. I welcome the fact that public pressure is forcing a rethink on that for now. The ISDS effectively allows foreign businesses to sue Governments for policy decisions that impact on their future profits. That would happen not through our domestic courts, but through new investor tribunals The ISDS is not, as many hon. Members have pointed out, a new concept. It exists in other free trade agreements. There are many examples of countries having been sued successfully for policy changes they have made: limiting coal mining in sensitive areas in Indonesia; attempts to raise standards for coal power plants in Germany; attempts to impose oil spill controls in South America and so on. The best known example, which we have already heard about, relates to Australia being sued by tobacco giants for taking measures to dissuade people from smoking. There are many other examples. Canada has been sued 35 times under current ISDS mechanisms. In one appalling case, Canada was sued by Ethyl Corporation for $250 million, via an ISDS mechanism, after it banned the highly toxic chemical MMT, which is an additive for fuel. Despite unequivocal evidence of harm—no one disputes the scientific case—Canada not only had to settle with Ethyl but reverse its ban. I accept that the ISDS has a role to play in limited circumstances. It exists to help companies do business in volatile countries with unreliable judiciaries, but the mechanism being proposed in TTIP will apply here, not in Venezuela or the Democratic Republic of the Congo I have asked the Government repeatedly for any examples of EU companies in the US, or US companies in the EU, being discriminated against by the courts of the host nation in the past five years. The answer is always the same: "The Government does not have access to relevant information." If we do not have that information, how on earth can the Government make the case for ISDS? One fundamental problem with ISDS is that its very existence would act as a permanent inhibitor for legislators. Where new evidence emerges, for example, of the dangers of a pesticide, Governments would have to think twice before introducing a new regulation. Essentially, it will give the companies that are big enough to use this system the power to freeze policy evolution and buy what is effectively a risk-free environment The power that vests in giant international corporations is hard to exaggerate, but it does not stop there. I understand that massive public pressure has meant that ISDS has been suspended and will not be part of next month’s negotiations. I do not believe that the issue has been resolved but, with or without ISDS, I believe TTIP is still structurally geared towards satisfying the interests of multinational corporations above all else. I do not see this as a question of trade or no trade; this is a question of basic democracy Let us consider the so-called regulatory co-operation councils being proposed by the EU as part of TTIP. They involve formally giving stakeholders early opportunities to intervene in the regulatory process; that is, seeing proposed legalisation before it is handled by Parliaments. Hon. Members do not need to be told what kind of stakeholders will end up on that council. It is worth considering what changes we might see under TTIP. What is it that big business wants? Free trade agreements are normally about reducing trade tariffs—taxes on imports and exports. There are very few tariffs between us and the US, so the focus will be on standards. In many respects, it is hard to imagine a harmonisation of standards between the US and EU resulting in better standards for us Food is, I think, the best example. Our standards are undeniably higher than the standards that apply in the US on a whole range of issues; hormones in beef, milk and pork, the use of steroids, chlorine-treated chicken meat and the clear labelling of processed food. We have a fundamentally different approach. We are told by our Government that food standards are safe and that nothing will happen. Try telling that to US agribusiness giants who have been engaging in an orgy of lobbying and have very high expectations.