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TiSA at a stalemate - Risks to regulations in the public interest remain

One year has passed since the Resolution concerning the controversial Trade in Services Agreement “TiSA” has been adopted by the European Parliament. Even more necessary was therefore the interim balance, which was drawn last week at a conference in the so-called Intergroup on Common Goods & Public Services in the European Parliament.

This interparty working group of MEPs gathered experts of the European Commission, the Chamber of Labour, the European Federation of Public Service Unions EPSU and the European Centre of Employers and Enterprises providing public services CEEP in order to have a critical discussion under the headline “TiSA, Right to Regulate and EU Labour Standards. What has become clear is that neither the resolution of the European Parliament, nor the current controversies in respect of TTIP and CETA have resulted in a reorientation of the negotiations. On the contrary, current delays are linked to the vague negotiating position of the US.

Hence, the Commission pointed out that the schedule for TiSA has been open since the US Presidential elections and that negotiations are currently on hold. The concerns voiced on public services were unfounded, as TiSA contains sufficient exempting provisions. Myrto Zambarta, Directorate-General for Trade, emphasised for example the so-called “public utilities” clause, which has been applied to the EU since the WTO General Agreement on Trade in Services GATS. Apart from that, negotiating parties in TiSA also agreed to include the recognition of the “Right to regulate” in the Agreement.

As the open agenda of TiSA can be seen as a so-called “New Generation” trade agreement, Oliver Prausmüller, trade expert at AK Wien, demanded a comprehensive change of direction. The far-reaching negotiation dynamics of these agreements have made reliable and complete exemptions for regulations in the interest of the public even more important. As examples were cited the proposals for a model clause on the comprehensive exclusion of public services, the required priority of the “Right to regulate” towards trade obligations and the demands of the European Parliament concerning the effective implementation of international labour standards. Symbolic proclamations or purely interpretative guidelines cannot replace clear priority rulings for public interests. The EU's demands for liberalisation in areas such as basic sanitation from other TiSA Participants do not hint at the exemption of public services from the negotiations.

Related to this, Penny Clarke, Deputy Secretary General of EPSU urged to use the current stalemate in the negotiations for reflection. The negotiations are still intransparent and comprehensive scope of action in the interest of the public has not only to be guaranteed for the EU. Liberalisation obligations in the health and wastewater sector and loopholes for the commercial interests of private operators also pose conflicts. This further leads to the problem that in case of a conflict with liberalisation obligations entered into, the sheer recognition of the “Right to Regulate” is not adequate. Another issue with the TiSA agenda is that it neither included a sustainability chapter nor measures against international tax fraud.

In addition, Rainer Plaßmann, trade expert of CEEP and Stadtwerke Köln, pointed out that it was currently difficult to foresee how narrow or broad the TiSA Agreement would be in the end. However, there are obvious areas of tension concerning public interests: for example the relationship between the “Right to Regulate” and the self-constraining liberalisation obligations of countries participating in TiSA. It was also questionable what effects such agreements might have on the scope for action to regulate new services, which are only created on the basis of technological development. The lack of thorough impact assessments, which, in particular also take the social dimension of such agreement into account, was also criticised.

Referring to the incompatibility with existing WTO guidelines, the Commission rejected to enshrine labour standards, for example those of ILO, which have been demanded by AK and EPSU as well as the European Parliament in its last year’s resolution.

Finally, it was also pointed out with some criticism in the discussion that there already have been good reasons prior to the US Presidential elections as to why the TiSA negotiations only made very slow progress – examples quoted included the controversies concerning public services, labour standards, policy space for domestic regulation or data protection. With CETA a comprehensive “New Generation” Agreement was passed during the past months. However, the current controversies around TiSA also show that such overloaded agreements are moving on thin ice.

Further information:

AK Europa Article on the TiSA Report of the European Parliament

Report by EPSU on the event

Report of Intergroup on the event

IGB Brochure on TiSA

Website of the working group

Interparty working groups in the European Parliament

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