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AK criticizes trade policy of the EU commission before the European Parliament

On 12 February 2014, a public hearing concerning the trade policy of the European Commission over the past 5 years took place in the Committee on International Trade (INTA) of the European Parliament. Joining the panel in his capacity as a European expert from the sector with close links to trade unions: Nikolai Soukup, one of the top AK experts der AK on the subject of trade policy. His conclusion: from the point of view of AK and trade unions, employees have little reason to rejoice at the Commission policy of the past years.

Stimulation of domestic demand more important than foreign trade to get out of the crisis

It must be regarded as high recognition for the work of the Chamber of Labour and the Austrian trade unions that Nikolai Soukup, one of its top experts, was invited to join three other European experts to present the critical points of the labour movement aimed at the trade policy of the European Commission to MEPs of the European Parliament, which after all represents about 500 million EU citizens.

To begin with, Soukup called to mind that the targets of the EU trade policy had to be consistent with the general targets of EU foreign policy as stipulated in Article 3 of the Treaty establishing the European Community: the sustainable development of the Earth, solidarity and respect among peoples, free and fair trade, eradication of poverty and the protection of human rights.

That is why an evaluation, which had now been initiated by the European Parliament, was important to assess the political coherence of the activities of the EU Commission. The Commission would time and again point out in official documents that trade was necessary to get out of the crisis. However, this was misleading said Soukup. He reminded that the trade between EU Member States, hence the entire so-called domestic demand, was far more important as it would account for almost all the exchange of goods and services between EU members.

Social and labour law clauses in EU trade agreements second rate


Soukup made the general remark that the EU would increasingly stray from the path of multilateral trade agreements, restricting itself more and more to bilateral and plurilateral agreements. However, from the point of view of trade unions, all agreements had an important weak point. For example, employment standards and social and labour law clauses, which were laid down in trade agreements, could not be enforced, which meant that they were subordinated to other agreement chapters. The AK would therefore demand that dispute settlement mechanisms had to be provided also for these rules. This would also apply to ILO Labour Standards and ILO Conventions. The EU Agreement with Korea would make it clear that these clauses and standards are very weakly worded. Apart from that, Korea had only implemented 4 of the 8 ILO Standards. Concerning the Agreements with Columbia and Peru, the AK would in general criticise the political environment and the blatant disregard for and threat to trade unionists and trade union rights.

Private investors sue the state behind closed doors


Soukup recognizes another serious problem with free trade agreements from a trade union, civil society but also democratic point of view in the mechanism for dispute settlement, which laymen, given the often confusing terminology of trade agreements, also call “Investor Protection Mechanism” (Investor to State Dispute Settlement Mechanism ISDS). This mechanism provides private investors with the option of taking action against democratically legitimized decisions by states if they believe that these damage their business interests. However, the decision concerning such complaints is not taken by a national court, but by a small board of “experts”, which in addition deliberates behind closed doors and, what is more there is no option of appealing against these “judgements”. Soukup called this construction an erosion of national legal systems, which the AK could not accept.

Public services too should be not be included in the trade agreements of the EU and not be subjected to the dictate of the market, said Soukup, who in this context also referred to the great victory of the first successful, European citizens’ initiative “right2water”, which was largely formed by representatives of public service trade unions, where about 1.6 million signatories spoke out against plans to privatise the water supply in Europe.

Hence, from an employee point of view, the performance of the European Commission in the past 5 years with regard to trade policy was mediocre said Soukup summing up. Important for both the present (negotiations for a trade agreement between the EU and the US) and the future was to strengthen the democratic legitimacy of the negotiations and to drag it from the backrooms into the lights, leading them before the eyes of the general public. This would also mean that the European Parliament was involved in all negotiation phases, ended Nikolai Soukup his statement.

Further information:

Video recording: Nikolai Soukup in the EP (between15:59:00-16:11:15)

PowerPoint Presentation by Nikolai Soukup

Questions and answers on the EU-USA Trade Agreement


Public Hearing – Draft Programme
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