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Germany’s economy minister proposes revisions to CETA




    Gabriel, Sanchez, Valls, Lofven, Schulz.

German minister of the economy Sigmar Gabriel is proposing to revise the Canada-European Union Comprehensive Economic and Trade Agreement (CETA), notably its investor-state dispute settlement (ISDS) mechanism. Gabriel says, “We demand a new approach to enforcing the law on regulation and protection of investment.”

Socialist Party representatives from Germany, France, Sweden, Denmark, the Netherlands and Luxembourg prepared the text for the congress of the Party of European Socialists that took place in Madrid this past weekend. Gabriel is the chairman of the Social Democratic Party of Germany, a junior coalition partner in German Chancellor Angela Merkel’s government.

Pedro Sanchez, the Secretary-General of the Spanish Socialist Workers’ Party, Manuel Valls, the Socialist Party Prime Minister of France, Stefan Lofven, the Prime Minister and leader of the Social Democrats in Sweden, and Martin Schulz,  the President of the European Parliament and the former leader of the Progressive Alliance of Socialists and Democrats in the European Parliament, were also in attendance at this congress.

Boerse.de reports (in German), “Federal Minister Sigmar Gabriel has partnered with social democratic European Union colleagues and proposed a compromise for the Free Trade Agreement with Canada, CETA.” The newspaper explains (in this initial rough translation) that, “Among other things, changing laws, even if it significantly reduces the profit margins that represent no plea. In addition, a call option to be granted, if investors get right in such proceedings. And investors have to decide whether to bring an action before a national court or before an arbitration tribunal. In order to minimize the number of procedures, to the principle of ‘the loser pays’ apply. This is in line with considerations of the European Commission.”

According to the news report, the revisions proposed to CETA also include:


  • consumer and agricultural sector standards must be increased

  • foreign investors should not receive better legal treatment than domestic investors

  • no pleas for bank settlements or debt sections.

It will be very interesting to see how Prime Minister Stephen Harper responds to this proposal from Gabriel. On October 1, 2014, given the news even back then about Germany wanting to amend CETA, the Financial Post reported a Canadian official saying, “Negotiations are over. …The text has been released in Canada and Europe and provinces and EU members have had it since Aug. 15… The investor-state dispute was actually agreed to back in October [2013] in the agreement-in-principle supported by all.”

In response to earlier comments from Germany and France about amending the ISDS provision, Yannick Jadot, a French Member of the European Parliament with the Group of the Greens/ European Free Alliance, has stated, “They have not gone far enough. It is necessary that Member States hear that European citizens do not just want a change at the margin of the arbitration, but removal of the provision.” We agree with Mr. Jadot and our European allies who are demanding the removal of ISDS from CETA and TTIP.

Further reading
French Senate calls for ISDS to be removed from CETA (February 2015 blog)
Germany and France want to reopen CETA to amend ISDS provision (January 2015 blog)
Paris and Berlin to form united front against ISDS in ‘free trade’ deal (January 2015 blog)
Germany says it will not sign CETA with investor-state provision (September 2014 blog)