In July 2013, the European Union and the United State started negotiating a proposal for the largest bilateral free trade agreement in history. The core aim was to increase jobs and growth in both bodies, especially after the recession caused economies to collapse on both sides of the Atlantic.

Studies commissioned by the European Commission projected that by 2027, direct and spill over effects of the Transatlantic Trade and Investment Partnership (TTIP) would increase exports between 0.9 and 7.6 per cent (while imports would increase at similar rates), and the GDP in Europe would increase by a maximum of 0.5 per cent (and a minimum of 0.3 per cent). In the case of jobs, studies proved inconclusive. The average family of four in Europe is estimated to benefit from an increase in income of €500 a year.

These figures assume an ‘ambitious’ agreement and are set for 10 years after the agreement is put to force.

Despite being underwhelming, these figures are positive at first glance.

Then why is there a European Citizen’s Initiative petition gathering over 2,500 000 signatures against this treaty? Why are people on the streets protesting?

‘Trojan Horse deal’

There are several hidden threats present in TTIP, which is being dubbed the ‘Trojan Horse deal’.

At the start of the negotiations, it became evident that removing tariffs between the two bodies was insufficient to increase market access, and thus ‘non-tariff barriers’ are being explored – ‘legislative barriers to trade’ are being removed or fine-tuned.

The topics covered by the treaty go beyond any trade deal witnessed to date. It covers most aspects of our daily life. The topics are split into three different themes:

• Market Access covering public procurement, services and rules of origin;

• Regulatory Cooperation covering food safety, animal and plant health, chemicals, cosmetics, engineering, medical supplies, pesticides, pharmaceuticals, textiles and vehicles

• Rules covering sustainable development, energy, customs and trade, small and medium enterprises, investor-state dispute settlements, competition, intellectual property and government to government disputes.

With the possible TTIP treaty being so influential in our daily lives, one would expect that relevant sectors, including consumers, are well-informed about the ramifications such a deal would cause them. Unfortunately this is not so.

Lack of transparency

Across Europe, most citizens are unaware of what this deal entails. After outcries from NGOs and civil society groups over the secrecy and lack of transparency, the European Commission published some negotiation documents to local government officials and cleared personnel. Unfortunately, documents available to civil society are either heavily censored, or offer little tangible details to date.

Corporate lobbies

Although civil society is being kept in the dark, the same cannot be said for multinational corporations. The negotiations are being heavily influenced by corporate lobby groups – mainly agribusiness, energy and pharmaceutical companies – which are pressuring to have their proposals for inclusion in the trade deals. Corporate Europe Observatory, an NGO in Brussels found that 88 per cent of the European Commission meetings with stakeholders were with corporate lobby groups, while only nine per cent were civil society groups and NGOs.

ISDS

The negotiators confirmed their interest in appeasing corporations with the inclusion of the ISDS clause. The Investor to State Dispute Settlement mechanism (ISDS) allows corporations to sue governments if any existing or future legislation is seen to have a negative effect on their trade. With this in place, governments will think twice before creating new legislation related to improving working conditions, environmental protection and health, as these generally come at a cost to business sectors.

If a case is ruled in favour of the corporation, the government has to fork out the compensation costs that can run to billions of euros, all paid from taxpayers’ money. The largest known settlement was of €553 million in the Ceskoslovenska Obchodni Banka v Slovak Republic Case.

The initial negotiations proposed that these court cases be held in ‘arbitration panels’ – courts separate from national court systems with privately-appointed lawyers. Due to public pressure, a compromise proposal was issued, vaguely including ‘transparency’ claims.

However, giving special rights to investors to sue entire countries in international courts is still in principle anti-democratic and highly dangerous, especially for small member states.

Regulations and standards

Another bone of contention in TTIP is the effect it will have on EU and national legislation and standards. Around 80 per cent of the predicted economic benefits of TTIP depend on the removal or harmonization of regulations and standards. There are two scenarios possible for tackling regulatory barriers.

The first is regulatory harmonization; this would result in streamlining both the European Union and the United State’s legislative bodies to the same standards.

Taking agriculture as an example, there are areas where standards in the EU are much higher than those in the US. The EU is stricter in regulations on labelling, product origin, chemical residue levels, pesticide use, GMOs, hormones and antibiotic use. This would put farmers in the EU at a severe disadvantage, as they are subjected to higher expenses. US agriculture is heavily subsidized, with ‘buy local’ policies which encourage retailers to choose local products over non-local. EU farmers could buckle under pressure from this increase in unfair competition.

The second scenario is ‘mutual recognition’ of standards. In this case, both bodies would accept products meeting standards on either side. The EU would be forced to accept products previously banned due to the inclusion of chemicals such as preservatives and colourants which the EU deems unsafe for consumption. In the EU, a ‘precautionary principle’ allows products to be banned based on factors beyond scientific research when this is insufficient to prove product safety. US legislation puts the onus on the authorities to prove a product is detrimental to human health – lack of such evidence means the product has to be allowed in the US market, and in the EU market should this scenario become reality.

Friends of the Earth Malta, in collaboration with the Front Against TTIP in Malta are organizing an ongoing campaign to raise awareness on this issue at a national level.

When considering both sides of the TTIP story, one cannot blame NGOs and civil society for being wary of such a trade deal. It is high time negotiations are halted, for the greater good.

Join us and sign the petition atstop-ttip.org. Let’s #stopttip

Elena Portelli is Project Officer for Friends of the Earth Malta