CETA's Festering Wound: Corporate Sovereignty

Remember CETA, the Comprehensive Economic and Trade Agreement between Canada and the EU? Even though the text was "celebrated" back in October 2014, it is still not ready to be presented for possible ratification. As Techdirt has been covering, it's pretty clear that the problem area is the corporate sovereignty chapter, because of concerns about the huge power it grants to Canadian (and US) corporations. First there were hints that Angela Merkel wanted the so-called "investor-state dispute settlement" (ISDS) mechanism changed. Then France said the same -- twice. Most recently, the EU commissioner responsible for trade and trade agreements, Cecilia Malmstrim, indicated that it wouldn't be possible re-open the corporate sovereignty chapter, or to move away from "classic" ISDS to the re-branded version known as the Investment Court System (ICS), which the European Commission is pushing in an attempt to head off growing opposition to the whole idea.

However, the arrival of a new government in Canada seems to have changed the situation once more, as Politico.eu reports:

With the new liberal government in power, there is hope for more flexibility to amend the [CETA] agreement via legal scrubbing, while not officially reopening it.

"We're prepared to work with the EU to work in the direction of an international court for investment disputes," Canadian negotiator Verheul said. "But if the EU is going to press us to adopt an appellate mechanism that would certainly involve quite a bit of further discussion " We recognize that's a longer-term exercise."

There are obviously some mixed signals there: yes, Canada is willing to tweak the details of the ISDS chapter, but no, it isn't prepared to go all the way to the Investment Court System -- probably in part because it doesn't exist yet, and its details remain sketchy. It's by no means clear how this will all work out in practise, but it does confirm that corporate sovereignty remains a festering wound in the CETA text, as it does in TAFTA/TTIP, where formal discussions about ISDS and/or ICS haven't even started (pdf).

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