Earlier, German judges ruled that Investor State Dispute Settlement (ISDS) provisions are illegal. The provisions, as brought forth by the Transatlantic Trade and Investment Partnership (TTIP), would create a whole new court system that would allow multinational corporations to sue countries for getting in the way of profits or future profits. Now, the EU Commission is fighting back against the courts, saying that the judicial system has misunderstood the ISDS.
A common refrain of many current “trade” agreements is the so-called ISDS provisions. Such provisions could potentially impact everything in civil societies of many countries around the world. This includes digital rights such as privacy and a fair legal system. That’s what makes ISDS provisions the flashpoint of a lot of opposition because it is seen as a method for corporations to supersede domestic laws and overrule democracy.
While a lot of the backlash comes from civil rights organizations, opposition political parties, and individuals, the recent German court ruling that said ISDS provisions were illegal was seen by many as a major blow to those pushing these trade deals. Some said that European officials were left scrambling trying to figure out what the next steps were to push the trade deal through even though parts of it are now considered unconstitutional.
After a week, the European commission has decided to fight the courts by saying that the German judges simply misunderstood what ISDS provisions were all about. The commission also disagreed with the assessment that the new court system was unnecessary. From the EUObserver:
The commission said the German magistrates had misunderstood ICS.
“It [the ICS] does not rule on member state law or EU law, and hence the ICS in no way alters the established court system within the EU and the member states,” a commission spokesperson told this website.
The EU executive maintains its court would different from ISDS because it would be transparent and give protection to EU investors abroad.
In turn, foreign investors in the EU would receive the same treatment.
“Given that EU law and member state law provides for a higher level of protection, an investor would use domestic law and would therefore be unlikely to need to go to the ICS system,” said the spokesperson.
Of course, if the new court system changes nothing, then this statement actually may play into the German judges argument that the potential new court system was unnecessary. If the court system doesn’t change anything in the member states of Europe, then what is the point of having these court systems in the first place when there is already an established court system already in place?
A major problem in all of this is the fact that TTIP is also highly secret. No text is publicly available to the public and the few people that are permitted (such as elected officials and corporations) are forced to remain silent on the matter. To make matters worse, the treaty, to date, has yet to be leaked. So, for the public, it’s impossible to know what specifically is in the agreement outside of trade officials offering hints as to what is in it.
Regardless of ones position on these matters, it’s not that hard to see this issue coming to ahead. What happens when the European Union passes an agreement that has already been ruled illegal by member states? That alone says that this issue isn’t going away any time soon.