Many of my constituents in the South-East have contacted me regarding TTIP and so I have decided to make my position clear to all. The vote that was scheduled for the plenary session on the 10th June has been postponed until further notice.
- TTIP is still being negotiated
- TTIP will not change the way the NHS is run
- TTIP will not lower EU standards
- TTIP will not undermine UK sovereignty
- TTIP will be subject to democratic scrutiny
TTIP Background and Benefits
First please allow me the opportunity to explain some background to these on-going negotiations.
The European Union and United States are each other’s main trading partners and enjoy the largest bilateral trade relationship in the world. Transatlantic trade flows averaged $4 billion each day through the first three quarters of 2011. Transatlantic investment exceeded $3 trillion in 2010. EU/US combined economies account for nearly 60 % of global GDP, 33 % of world trade in goods and 42 % of world trade in services. Both partners make up for more than half of foreign direct investment in each other’s economy.
However, for all its value and importance, the EU-US trading relationship still suffers from numerous obstacles, preventing it reaching its full potential to provide growth and jobs. Estimates show that a comprehensive TTIP would benefit the EU to the tune of €120bn (that is an extra £433 in disposable income per year for a family of four). This is the best value stimulus that Europe can afford.
The aim TTIP is to increase trade and investment between the EU and the US. We seek to make it easier for British businesses to sell products in the USA; while making it easier and cheaper for you to purchase a wider range of goods online. We will achieve this through three pillars:
- Reducing import tariffs (reducing costs to consumers),
- Mutual recognition and regulatory convergence without lowering safety standards,
- Setting global standards for future trade deals with other countries and establishing a common approach to global trade issues.
Your Conservative MEPs are committed to ensuring that any such trade deal is a balanced and reasonable agreement without sacrificing any EU safety, health, food, social and data protection standards.
The European Council (including the UK Government) adopted a mandate for negotiations on 14 June 2013. This set the limits within which the Commission can negotiate this deal. Negotiations have been on-going for around 18 months and are likely to continue for at least a similar time period. Once negotiations have concluded the European parliament will then have a final text to consider and vote on.
Investor to State Dispute Settlement Mechanism (ISDS)
The negotiating mandate given to the Commission by the Member States (including the UK) contains a request to possibly include an ISDS clause that would allow investors to initiate proceedings directly against the US government should they believe that their property has been expropriated illegally, or if they have been discriminated against by the country in contravention of the commitments contained in TTIP.
ISDS has been included in many trade agreements and is common to UK investment treaties. There are 3400 such investment agreements in force worldwide The UK has used this system since 1975 and it uses ISDS with over 90 countries; no ISDS challenge has been won against the UK. On the contrary UK investors have brought 43 ISDS claims against other countries to protect their investments. The greatest value for ISDS comes in protecting UK investment in developing countries and by including it in TTIP we will be setting the gold standard for other trade agreements worldwide.
Prior to ISDS, disputes which could not be resolved by dialogue or in domestic courts either remained not resolved, or required diplomatic action and, in extremis, the threat or use of military force.
Member States including the UK want to encourage foreign investment and seek the benefits that this brings. It therefore seems right that such investors can rely on nations to act in accordance with the trade agreement. It is akin to a claim for damages where a government unfairly breaches a contract.
The reason why many people have reservations regarding the inclusion of ISDS is that some claims have been brought recently against other governments for passing laws that were enacted for the public good. I fully understand that ISDS is in need of reform and that there are examples of other treaties globally that have been poorly worded and work must be done to improve it. However, what will be possible under ISDS in TTIP will be dependent on what is agreed upon in the TTIP agreement itself. Your Conservative MEPs want to ensure that any ISDS clause included in TTIP is restricted to prevent frivolous claims and to ensure governments are not prevented from acting in the interest of the public good:
- I am reassured that both the EU and USA are committed to ensuring that legislation reflecting legitimate public choices e.g. on the environment, cannot be undermined through ISDS claims.
- We will not accept ISDS to be used to pursue frivolous claims by companies against governments.
- Furthermore, ISDS will neither allow for private firms to overturn existing laws nor prevents sovereign states from introducing new laws.
- ISDS does not remove the right of nationalisation.
Following the unprecedented interest shown by citizens in the on-going TTIP talks, with a particular focus on the potential inclusion of ISDS, the former Commissioner for Trade, Karel De Gucht, who used to oversee the negotiations on behalf of the EU, suspended talks on the ISDS part of TTIP and opened a public consultation giving people across the EU three months to present their comments, suggestions, concerns and worries. The results of this are currently being analysed and will contribute to the continuing negotiations.
Your Conservatives MEPs support the inclusion of an ISDS chapter in the agreement, subject to the above conditions, because even with developed countries it ensures certainty for our investors, including SMEs, and will ensure that UK firms are not treated any differently from American firms, pursuant to the U.S. commitments under TTIP.
Let me be clear, TTIP is not intended to open the NHS, or any other European health service, up to competition from American multinationals. All parties involved from the UK, the British Prime Minister, the EU, the USA and other European member states are united in this issue. There is no party seeking to use TTIP to alter the running of the NHS. There is no specific mention of national public health service liberalisation anywhere in the mandate given to the European Commission by the national governments of the EU.
The EU’s Chief Negotiator on TTIP recently wrote to the Chair of the All-Party Parliamentary Group on TTIP (the Rt Hon John Healey MP) to explain that TTIP would not affect the UK Government’s control of the NHS and I attach this letter for your reference.
As Prime Minister David Cameron recently stated “There’s no threat, I believe, from TTIP to the NHS and we should just knock that on the head as an empty threat”.
If we look to precedent, the EU usually includes general exceptions in its trade agreements with respect to public services in general and public health in particular , which can legally override any trade obligations. The EU and the US will therefore keep its “policy space” with regards to these matters. In other words governments will retain the ability to legislate in the interests of their citizens as they see fit.
The recently finalised trade agreement with Canada (CETA) proves a useful precedent in this case. CETA contains an exemption, the “utilities reservation” which includes public health, education, and other public services. This exemption will allow the UK to maintain its public policy in the area of public health, which includes the NHS.
The Conservatives will instruct the Commission to include similar language in TTIP, so that the UK’s public policies will remain unaffected. It may also be assuring to know that neither the EU-South Korea FTA nor the North American Free Trade Agreement included or resulted in the opening of publicly funded health services.
Please be assured that the Parliament will have to give its final approval to the deal. Your Conservative MEPs are committed to ensuring TTIP does not threaten the NHS and we are closely monitoring the progress of the negotiations. Should we believe any final agreement threatens the NHS your Conservative MEPs would not support it.
TTIP is not about lowering standards on either side of the Atlantic, and the negotiators and all democratically elected EU Member State governments have explicitly said this.
What TTIP will allow is the potential to harmonise and converge standards, where they have similar outcomes. European business, especially small and medium-sized enterprises (SMEs) are continually held back because US regulatory bodies test products in slightly different ways, even if the same health and safety standards are to be met.
A prime example is the car industry, where there are high standards on both sides of the Atlantic. Standards bodies are now in talks on the boundaries of the negotiations to come to an agreement on safety aspects such as seat belt fixings, so that testing is not duplicated. This has the potential to save EU and US car manufacturers’ vast amounts of money. There may even be room for future sharing of inspection regimes.
As the Conservative spokesman on the European Parliament’s Agriculture and Rural Development Committee, I want to share a few thoughts on TTIP and how it may impact agriculture.
However, given the geopolitical situation with the Russian embargo on many agricultural products, a general decline in prices for agricultural produce and the rise in production costs, the EU agricultural sector is in a very serious and concerning situation with many farmers now producing below production costs with nowhere for their produce to go. It is therefore important for the longevity of this sector and to protect European farmers and their family farms by finding new markets for their products. This can only be done by entering into trade deals with third countries. It makes sense therefore to work hard to grasp this opportunity for our farmers by opening up new markets in America for jobs and growth in Europe.
The negotiations around TTIP have been criticised for lacking transparency and taking place behind closed doors. This is not unusual; trade negotiations require an element of strategy. However we support greater transparency and are keen to ensure that every piece of material which will not negatively prejudice our negotiation position is available to the public.
I am pleased to see that the European Council (representatives of EU member state governments) has released the mandate that it gave the Commission for these negotiations. I have attached this for your reference. Conservative MEPs support greater transparency and are keen to ensure that every piece of material which will not negatively prejudice our negotiation position is available to the public.
The final agreement is yet to be written. However, it is likely to be what is called a “mixed agreement”. This means that it will have to be ratified by the UK Parliament.
A UK All Party Parliamentary Group on TTIP has been set up to close monitor the negotiation process and your Conservative MEPs are part of the European parliament TTIP Monitoring Group which meets before and after each negotiation round to discuss the finer details of developments.
During each round of negotiations the two chief negotiators meet with stakeholders, such as civil society groups, NGOs, industry representatives, to hear their views as well as to brief them on the developments during the negotiating round. The EU Chief Negotiator briefs the US Monitoring Group of the European Parliament’s International Trade Committee before and after each negotiating round.
A final agreement will need to be ratified by the European council (representatives of EU member state governments). This means the UK Government has a vote and can reject the deal if it is not satisfactory. I and your other elected MEPs will also then have a vote to approve or reject the agreement based on our analysis of the final text.
Richard Ashworth MEP
Conservative MEP for South East England
The mandate given to the Commission to direct its negotiations: http://data.consilium.europa.eu/doc/document/ST-11103-2013-DCL-1/en/pdf
Letter dated from EU Chief Negotiator to Chair of APPG on TTIP: http://im.ft-static.com/content/images/c571cdbc-08f0-11e4-9d3c-00144feab7de.pdf