The EU-Canada Trade Agreement CETA Still Isn’t Done, And May Be Partially Undone Because Of Its Corporate Sovereignty Provisions

from the well,-we-did-warn-you dept

The EU-Canada Comprehensive Economic and Trade Agreement (CETA) is one of several long-running trade deal sagas covered by Techdirt. It seemed to be almost over in 2017. After a constant on-off excitement about whether CETA would survive, it was ratified by the European Union. But it still needed to be approved by all the EU Member States’ national parliaments before it came into force. The chief stumbling block to national ratification was the investor-state dispute settlement (ISDS) provisions, which would allow investors to sue governments over laws or decisions which could potentially harm future profits. This imposition of corporate sovereignty through trade deals is an issue that Techdirt has been covering for many years. Despite widespread concerns about ISDS, in 2019 the Court of Justice of the European Union, the EU’s top court, ruled that corporate sovereignty was compatible with EU law, apparently removing the last obstacle to CETA’s ratification by Member States.

And yet here we are, eight years after the final text of CETA was “celebrated“, and another major problem has emerged. The Irish Supreme Court has just ruled that ratification of CETA would be unconstitutional without holding a countrywide referendum on it. The argument that was used successfully to convince the court to halt Ireland’s ratification is the following:

The court was told during the March hearing that “sovereignty” was at the heart of the appeal, with the Dublin South Central [member of the Irish parliament] expressing concerns about the constitutionality of provisions in Ceta for “investor courts” to decide complaints by Canadians who invest in EU member states.

It was submitted the State cannot authorise the treaty “without the mandate of the people”, by way of a referendum.

Yes, it’s corporate sovereignty rearing its ugly head again, just as it has done many times in the past. But there’s a big difference now. As Techdirt wrote a few weeks ago, governments are finally waking up to the dangers of ISDS, and are actively seeking to withdraw from the Energy Charter Treaty, which also contains corporate sovereignty provisions.

Since politicians are themselves turning against the idea, it would not be surprising if its opponents succeed in convincing a majority of the Irish people to vote against allowing ISDS in CETA in the new referendum, whenever that is held. And if Ireland refuses to ratify ISDS in CETA, that would nullify the ISDS provisions across the whole of the EU. CETA would then come into effect, but without its worst feature.

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Filed Under: canada, ceta, cjeu, corporate sovereignty, eu, ireland, isds, referendum