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European Parliament to vote on excluding water from ‘free trade’ agreements

On June 25, the European Parliament’s Committee on the Environment voted in support of the human right to water and sanitation.

Our ally Food & Water Europe states in a media release that, among various measures the Committee, “Considers it imperative that production, distribution and treatment of water and sanitation are excluded from any trade agreements, including TTIP [the United States-European Union Trade and Investment Partnership] and TISA [the Trade in Services Agreement now being negotiated on the sidelines of the World Trade Organization by a group of 23 governments representing 50 countries, including the European Union, Canada and the United States].”

How would a ‘trade’ agreement like the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) impact on water?

In its September 2014 analysis of the CETA text, the Canadian Centre for Policy Alternatives says, “With limited exceptions, CETA treats water as any other tradable good, and the delivery of water as it does any other commercial service. After considerable public pressure to exclude water services from the agreement, Canada and the EU have taken broad Annex II reservations for market access and national treatment obligations with respect to the collection, purification and distribution of water. These reservations give governments the authority to restore public monopolies, where water privatization has failed, but foreign investors can still challenge this decision under the fair and equitable treatment and the expropriation provisions of the investment chapter. The CETA does not provide adequate protection for what should be a universal right: affordable, publicly delivered water and sanitation services.”

On pages 112 to 120, the CCPA report specifies:

– “…No government (federal, provincial, municipal, First Nations) is obliged to allow a company or investor to take water out of its natural state for export or use in some kind of commercial venture such as bottling, manufacturing, tar sands production, etc. However, where one company is permitted to do so, CETA’s market access rules (e.g. national treatment, a ban on performance requirements) and investment protections (e.g. minimum standards of treatment) kick in. Water ceases to be an excluded public good but becomes bound up, as a commodity, within the CETA text.”

– “…Canadian and EU governments, including municipalities, are free to privatize or partially privatize (through public-private partnerships or P3s) public water systems whenever they like. But they are less free to remunicipalize those private services in the future, if service levels are inadequate or the private service becomes too expensive. The Market Access reservation would give governments the ability to re-instate public monopolies but investors have new rights to challenge the same decision through private investment tribunals.”

– “…Procurement of at least some water services by local governments, utilities and Crown corporations is covered, and that this will likely give private water companies a ‘foot in the door’ to establish and expand the private delivery of what the United Nations considers to be an essential public service best delivered by the public sector.”

– “Surely the federal government’s strong encouragement of P3s for local water infrastructure, including a P3 screen, and specifically a decision by PPP Canada requiring a local government to go the private route in exchange for federal funds, would create an expectation on the part of private water companies that could trigger an investor-state dispute (if, for example, public opposition to a P3 or private water leads to a reversal of the PPP decision.) It is admittedly difficult to know how an investment tribunal would rule in such a case – an ambiguity that fuels public opposition to these ad hoc corporate courts.”

– “‘The ability to respond to new information, changing conditions or shifting public opinion is an essential freedom for democratic governments concerned with how best to serve the public interest.’ In order to protect that essential freedom, the CETA would need to be redrafted to fully exclude water and water services, to shield public decisions related to water from trade or investment disputes, and to encourage rather than restrict the ability of local governments to reverse course where privatization fails.”

In terms of a timeline, the European Parliament is expected to vote on the exclusion of the production, distribution and treatment of water and sanitation from any trade agreement along with other key recommendations this coming September. It is further expected that the European Parliament will vote on the ratification of CETA around April 2016.

The Council of Canadians is campaigning to stop the ratification of CETA.

Further reading
TISA threatens to lock in water privatization (May 2014 blog)
Full of Holes: Newly leaked documents show Canada is opening the door widely to private water companies in trade negotiations with European Union (joint report with CUPE, January 2012)
CETA threatens public water services, says Shrybman (May 2010 blog)