the trade agreement currently being negotiated between the EU and US has major implications for the Internet and democracy, largely because of the likely inclusion of investor-state dispute settlement (ISDS), which allows companies to sue nations for alleged loss of future profits. The net effect of this will be to place companies above national laws, and to create a chilling effect on legislation in the public interest.
3. ACTA
most Europeans couldn't even name
a trade agreement before 2012
in 2012, millions of Europeans
became aware of one in particular
Anti-Counterfeiting Trade
Agreement (ACTA)
EU, Australia, Canada, Japan,
Mexico, Morocco, New Zealand,
Singapore, South Korea, & the
United States
4. European protests
EU-wide street protests organised
for 11 February
organised online
Netzpolitik.org
La Quadrature du Net
massive numbers took to the
streets
Germany (100,000), Denmark
(15,000), Austria (10,000),
Bulgaria (7,000), Romania (5,000),
Hungary (1,000)
5. ACTA's problems
civil damages
criminal damages
"any legitimate measure of value the right
holder submits...which may include
suggested retail price"
"to be applied at least in cases of ...
copyright or related rights piracy on
commercial scale"
"for direct or indirect economic or
commercial advantage"
digital chapter
"promote cooperative efforts within the
business community"
6. defeat for ACTA
4 July: plenary vote on ACTA
European Parliament voted down
ACTA by 478 votes to 39, with 165
abstentions
remarkable majority
remarkable rejection of
international trade agreement
negotiated by European Commission
7. victory for democracy
David Martin, ACTA Rapporteur:
"for the first time the European
Parliament has used the powers
granted by the Lisbon Treaty to
reject an International Trade
Agreement."
Martin Schulz, EP President:
"demonstrated the existence of
European public opinion that
transcends national borders."
8. TAFTA/TTIP
TAFTA/TTIP is not (just) a trade
agreement: mostly about "nontariff" barriers
€119 billion GDP increase
dismantling both tariff & nontariff
€24 billion GDP increase
health, safety, employment,
environmental regulations
dismantling tariff barriers
figures relate to 2027
9. TAFTA/TTIP and ACTA
Karel de Gucht
"ACTA, one of the nails in my
coffin. I’m not going to reopen
that discussion. Really, I mean, I
am not a masochist. I’m not going
to do this by the back door"
EU negotiation directives for
intellectual monopolies: "shall
not include provisions on
criminal sanctions"
what about civil ones?
10. EU-Singapore FTA
initialled 20 September 2013
still to be agreed upon by the
European Commission and the
Council of Ministers
ratified by the European
Parliament
has several sections that are cut
and paste from ACTA
11. ACTA backdoor?
EU-Singapore FTA 11.44.2 Damages:
"any legitimate measure of value
the right holder submits...which
may include suggested retail
price"
ACTA 9.1 Damages
so if European Parliament
ratifies this FTA, easy to put it
into TAFTA/TTIP
maybe other ACTA elements
digital chapter
12. ISDS
also included in EU negotiation
directives is strong call for
"investor-state dispute
settlement" (ISDS) measures
increasingly common element of
trade agrements
even more obscure and unknown –
and not just among general public
13. ISDS facts (1)
basic idea is to protect
investors from arbitrary
government actions or weak court
systems in developing countries
achieved by allowing companies to
take action directly against
governments
using specialist external
tribunals
14. ISDS facts (2)
tribunal generally 3 lawyers, who
also represents companies before
similar tribunals
no conflict of interest rules
no limits on amount of award
against a government
last year saw biggest ever award –
$1.77 billion to Occidental,
against Ecuador
very limited appeal rights
15. ISDS facts (3)
United Nations Conference on
Trade and Development (UNCTAD)
2012 ISDS Report:
total ISDS cases so far –
countries involved – 95
EU countries involved – 15
most cases from US companies
new cases last year –
70% in favour of companies
58
518
16. ISDS facts (4)
ISDS cases:
Australia – adding warnings to
cigarette packs
Canada – banning pesticide;
moratorium on fracking
El Salvador – refusing mine permit
Germany – nuclear power phase-out
Mexico – refusing to allow toxic
waste plant
Uruguay – adding warnings to
cigarette packs
17. Eli Lilly vs Canada (1)
Canadian courts invalidated
patents on two Eli Lilly drugs
in November 2012, Eli Lilly sued
Canada for $100 million
invoking ISDS in North American
Free Trade Agreement (NAFTA)
in July 2013, increased claim to
$500 million for the two drugs
patents that were denied
18. Eli Lilly vs Canada (2)
Eli Lilly claims Canada has not
met "minimum standards of
treatment"
patent maximalism in US
as a result, Eli Lilly's
"expectation of profit" was
"unjustly" upset by courts'
decisions
this makes it a victim of
"indirect expropriation"
19. monopolies as investments
ISDS originally applied to
tangible items such as buildings,
machinery etc., designed to
prevent expropriation by foreign
governments
Eli Lilly case now seeks to
appliy ISDS to intellectual
monopolies and tries to define
patents as investments, and
therefore protected from
"expropriation" by withdrawal
20. ISDS and EU
German proposal to ban software
patents (again)
calls to widen copyright
limitations & exceptions in EU
text & data mining
calls for "fair use" provision in
UK
"failure" to update 2004
directive on enforcing
intellectual monopolies (IPRED)
21. TAFTA/TTIP:ACTA backdoor 2?
not by the back door *directly*,
but *indirectly*
allows companies to challenge
laws or court decisions on
intellectual monopolies that harm
their "expectation of profit"
challenge Internet laws
to avoid that, EU might push for
ACTA-like measures
22. back-door ACTA+
not only could ISDS bring in
ACTA's worst ideas
also allows any standards and
regulations not levelled down by
non-tariff removal to be
challenged
so claims that TAFTA/TTIP will
not affect EU's regulatory regime
are misleading if ISDS is part of
it
23. TAFTA/TTIP's other problem
fight against ACTA was in part a
revolt against secret deal-making
that threatened ordinary people's
use of the Internet
like ACTA, TAFTA/TTIP will be
conducted behind closed doors,
with minimal information about
what is happening
new fight for transparency
24. new surprising ally (NSA)
NSA is spying on European Union
embassies in US
NSA is spying on EU companies
thanks to zero-day exploits from
Microsoft and others
NSA is spying on vast swathes of
the Internet
NSA is doubtless spying on EU
officials in many other ways
25. TAFTA/TTIP is not secret
US will have copies of *all* EU
negotiating documents
China and Russia will also have
access to *all* EU negotiating
documents
most large companies and industry
associations have access
only one group doesn't
the public
26. negotiating in public
de Gucht says: "you cannot
negotiate openly"
simply not true: WIPO treaty for
the blind negotiated publicly
draft documents
structured stakeholder input, with
reports and summaries
live webcasts of negotiations
model of transparency
27. transparency = democracy
if people know what is being
negotiated in their name, they
can analyse and understand the
real implications, not the spin
express their views to their
representatives
democracy requires transparency
secret negotiations are
profoundly anti-democratic
28. going public, going forward
trade agreements are complex and
obscure
TAFTA/TTIP is even more complex
and obscure
explaining all the issues to the
public impossible task
need to concentrate on a few key
issues, and the corresponding
demands
29. ISDS out
unnecessary: ISDS is designed for
situations where governments are
capricious and legal frameworks
are weak
anti-social: allows health and
safety regulations to be ignored
anti-democratic: allows national
and EU legislation to be
overruled by unelected, secret
tribunals, in favour of foreign
corporations
30. transparency in
we need *all tabled EU documents*
to be made public immediately
need to push for full
transparency for TAFTA/TTIP – and
every trade agreement
before the Internet, that would
have been simply impossible
today, it *is* possible, and is
thus indispensable for true
democracy in the digital age