Trade and International Affairs

European and Canadian unions call for changes to CETA

May 4, 2016

The Canadian Labour Congress and the European Trade Union Confederation are uniting to call for five changes to the EU-Canada Comprehensive Economic and Trade Agreement (CETA).

“By adopting the changes we propose, Canada and European countries have an opportunity to make the promise of a ‘gold standard’ trade agreement a reality,” said CLC president Hassan Yussuff.

Europeans have had some opportunity for debate, leading to some amendments to the deal’s Investor-State Dispute Settlement (ISDS) provisions. But the CLC and ETUC say more debate is needed on both sides of the Atlantic.

“At a time of growing inequality, economic instability and an undeniable climate crisis, all trade agreements must reflect that reality,” said Yussuff.

“That’s why we hope that recent amendments signal a willingness to do the work now, before it’s put to a vote, to ensure CETA will benefit local and national governments and their citizens in the long term,” he added.

Five changes needed to the CETA

1. Remove investor courts and ISDS mechanisms

Foreign investors cannot be granted special privileges not granted to domestic investors. The investor court system currently proposed still gives foreign investors remedies that would not be available to them under any domestic court system in Europe or Canada. There is no need for investor court systems or ISDS mechanisms between countries with fully developed and effective court systems.

2. Uphold labour rights

The proposed text lacks mechanisms for enforcing labour rights. CETA encourages – but does not require – participating countries to ratify and fully implement ILO core labour conventions. If participating governments really want CETA to be the gold standard for trade agreements, violations of its labour provisions must be subject to sanctions.

3. Build in review

The final agreement should require a full review of the merits and effectiveness of both the investment and labour provisions within five years of ratification.

4. Protect public services

CETA must contain a “positive list” for its service commitments and no ratchet or standstill clauses so that public services are fully excluded from the deal. Currently CETA uses a “negative list”, requiring countries to list services they want excluded from the deal. This means that new or emerging areas of services, such as pharmacare or child care, would be automatically subject to the agreement. No responsible government can reasonably commit to privatization to default. Instead, a “positive list” would better protect the public interest by allowing countries to specify which services would be covered by the agreement.

As it stands, even when countries choose to protect specific public services by including them in reservations under “Annex 1”, they are subject to so-called “standstill” and “ratchet” clauses. This means existing privatization is locked-in and public ownership cannot be expanded. In combination with the investor-state provisions, these clauses could prove to be a real and costly obstacle to future governments, at all levels, that may want to increase public involvement in services.

5. Protect local governments

Local governments must maintain the right to attach social, economic and environmental conditions to public procurement. As it stands, CETA calls for “unconditional” access at all levels of government. This is excessive and unprecedented. Governments use public procurement to promote the public interest, by, for example, creating local jobs, providing training for local workers, promoting affordable housing, supporting local business and protecting the environment. If ratified as is, CETA will curtail local governments’ rights. This is especially troubling while governments everywhere are being called on to fight climate change and address economic uncertainty.

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