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MYTHS 

About #TTIP

Demystifying TTIP

The Transatlantic Trade and Investment Partnership (TTIP) is a trade agreement being negotiated by the European Union and United States that will, if done well, provide significant new and beneficial opportunities for citizens and companies alike. The TTIP talks are attracting a great deal of attention, and are subject to contentious debate between critics and supporters.

ARC seeks to separate the myths from the facts within an open, rational and informed debate. It looks to address a wide range of misconceptions about the content and process of the TTIP talks, and on the impacts of free trade more generally.

Our A-Z differentiates between justified public concerns and unfounded, misleading assertions about what a future transatlantic trade agreement will mean for Europeans and Americans.  

 

Myths starting with ABCDEFGHIJKLMNOPQRSTUVWXYZ

c

Myth: Will TTIP lead to deregulation and lower consumer protection standards?

Fact: No, it will not. The aim of TTIP is to keep a high level of standards and to make regulations more compatible.

 

Consumer protection standards in the EU and US are amongst the highest in the world. But specific rules vary on both sides of the Atlantic. As a result, some products that Europeans enjoy cannot be easily accessed by Americans, and the other way around.

 

TTIP aims to change that: if health, safety and environmental standards are more compatible, consumers will have more opportunities to choose which products they want to consume.

 

Consumers will benefit from greater choice in that those who wish to drive change to more energy efficient lightbulbs, or more recyclable motor vehicles for example, will have increased opportunities to do so.

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Myth: TTIP will undermine the EU’s cultural diversity.

Fact: The TTIP negotiating mandates does not allow for provisions that would prevent the EU from promoting cultural diversity.

Some people worry that TTIP will endanger Europe’s cultural diversity. They are particularly concerned that a flood of American movies will kill Europe’s film industry.

 

Cultural diversity is a distinctive feature of the EU, and cultural and creative industries are one of the most dynamic sectors providing millions of jobs across the Union. The EU traditionally excludes the opening of the films and television, the so-called audiovisual sector, to competition from foreign firms when negotiating trade agreements as it believes that this sector should be treated differently from other services in trade deals. TTIP is no exception. Audiovisual services are expressly excluded from the negotiating mandate that the Council granted to the European Commission.

 

The EU attaches a great importance to its cultural heritage and has many rules to protect it. The EU treaty explicitly states (Article 167 TFEU) that the Union should take into account cultural aspects in its action when, for example, negotiating trade deals. Member States also have their own laws to protect and promote cultural diversity. TTIP does not aim to change this. It will not affect Member States’ ability to promote cultural diversity or decide on their own audiovisual policies, nor will TTIP impact on government decisions to provide financial support to cultural activities and industries such a theatres or operas.

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d

Myth: The Commission is the negotiator but is not a democratic body. It takes into account the views of business groups, but ignores environmental activists?

Fact: The Commission negotiates under a mandate which it receives from EU member state governments.

Members of the European Commission are not elected, but their appointment follows a nomination procedure by EU Member States that is subject to approval by the European Parliament. Hence their selection takes place under a democratically-driven process.

 

The Commission negotiates under a mandate which it receives from the Council of Ministers. It has a statutory duty under the Lisbon Treaty to fully inform Member States and the Parliament on progress of the negotiations. It consults widely with all stakeholders, from business groups to agricultural lobbies to civil society activists. This includes both the period before a negotiation is launched, and during the negotiations themselves.

 

As far as TTIP is concerned, the chief negotiators have set aside a day for stakeholder consultations during each of the seven official rounds to date. This unprecedented measure has injected transparency into the negotiations on a level that has never been seen before. This may in time create a precedent for the EU’s trade negotiations with other partners, which would be a positive spill-over from these specific talks. In fact, the joint announcement of the TTIP transparency initiatives on 25 November 2014 by the Chair of the European Parliament’s Committee on International Trade, Bernd Lange MEP (S&D, Germany) and EU Trade Commissioner Cecilia Malmström is further evidence of the unprecedented measures that the EU institutions are taking to ensure greater transparency in trade negotiations.    

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Myth: TTIP is ‘a Charter for Deregulation, an attack on Jobs and the end of Democracy’?

Fact: The aim of TTIP is not to diminish regulation or attack jobs, but to create new opporunities via trade.

Some stakeholders claim that TTIP is ‘a charter for deregulation, an attack on jobs and the end of democracy’[1]. This is unsubstantiated. It indicates the intention to misinform, or a misunderstanding of the facts.

 

The aim of TTIP is not to dismantle regulation, but rather to reduce trade barriers that arise when there are different approaches to standards between two trading partners. The aim is not to put jobs under threat, but to create new employment opportunities through increased trade. This is much needed at present, and one of the most important objectives of democratically elected governments.  


 

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f

Myth: EU specialties will lose their protected status under TTIP?

Fact: Negotiators aim to strengthen the protection of our GI products in the US market.

 

Some fear that the protection of certain regional fine foods and drink could be weakened under the future EU-US free trade agreement.

 

It is true that the EU and the US has a different way to protect special agricultural products. In the EU, we use geographical indication (GI) to protect products while the US has a trademark regime. However, the European Commission has always put a great emphasis on supporting better protection of GIs when concluding multilateral or bilateral trade agreements. TTIP is no different.

 

TTIP is not about changing our GI laws and accepting the US’s approach through a trademark system. It is about strengthening the protection of our GI products in the US market. The aim of the EU’s negotiating team is to make the US protect an agreed list of EU GIs with rules to stop other producers misusing them and to enforce those rules effectively. And even if EU negotiators do not manage to achieve all of their goals on GIs, the European system for protecting and registering GIs will not change. The EU will not allow California ‘Champagne‘ or ’Feta‘ produced in Wisconsin to be circulated on the EU market under such labels.

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Myth: TTIP will allow US firms to use ‘fracking’ to produce shale gas in the EU.

Fact: EU Member States’ governments are responsible for deciding whether or not to allow shale gas production in their country. Nothing in TTIP could limit this sovereign right.

 

One of the EU's aims for TTIP is to create an open, transparent and predictable business environment in the field of energy[1]. This would be beneficial for both EU and US citizens and businesses.

 

However, some stakeholders argue that TTIP will permit US firms to use ‘fracking’ to produce shale gas in the EU without EU governments being able to prevent this. This is incorrect!

 

In fact, the prerogative whether or not to allow such practices will remain with the EU Member States[2]. Only they can decide to allow or ban ‘fracking’ for gas production within their borders. However, if an EU member state should decide to allow shale gas production, TTIP could contribute to creating equal business opportunities for companies on both sides of the Atlantic.

 

[1] Directives for the negotiation on the Transatlantic Trade and Investment Partnership between the European Union and the United States of America.

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g

Myth: When TTIP is agreed, Europeans will be forced to eat food that is genetically engineered.

Fact: EU countries have their own say on GMOs. If products contain GMOs, the label must make this clear.

 

Many people in the EU are very concerned about Genetically Modified Organisms (GMOs). Most people in the US are not so worried and see a lot of benefits from their use. TTIP will not change high GMO standards and food safety in the EU.

 

The EU follows scientific evidence in deciding which GMOs are safe, but still allows individual countries to ban products with GMOs that they do not want. If products contain GMOs, EU labelling rules state that this must be clearly visible for the consumer at the point of purchase.

 

Hence TTIP will not reduce the choice that consumers have to buy or stay away from GMO products.

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i

Myth: TTIP does not need ISDS provisions as they give investors too much power against governments?

 

Fact: ISDS is a tool to implement the law, not one to make or change it.

 

The EU and US have mandates from their political authorities to negotiate ISDS provisions in TTIP. Both sides are looking for clarifications and improvements in the system’s existing arrangements which aim to settle disputes through bilateral discussions, with referral to independent arbitration in cases that cannot be amicably settled.[1]Amongst other considerations, both sides to the TTIP talks want to further confirm the right of governments to regulate in the public interest.

 

Investor state dispute provisions are nothing new. There are around 4,000 bilateral investment treaties (BITs) in force between countries all over the world, and more than one quarter of these are between individual European countries and third countries, including the US. The only new element is that TTIP would replace the existing agreements by a treaty at the EU level.[2] 

 

There is wide recognition that investors need greater protection from host governments in various parts of the world if foreign direct investment is to continue to be an engine for socioeconomic development.

 

 

 

[1]   A network of specialized Arbitration courts and tribunals has existed for many years, linked in general to the Chambers of Commerce in London, Stockholm and the ICC in Paris. There are also fora established by International bodies such as the World Bank (ICSID) and the UN (UNCITRAL).

[2]   Under the Lisbon Treaty adopted in 2009 investment matters will in future be part of EU Common Commercial Policy, and the Commission now has responsibility for negotiating in this area on behalf of the EU.

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p

Myth: TTIP will lead to public sector job losses because the EU’s member states will be forced to liberalize health and education services.

Fact: The negotiating mandate for the EU does not open up for discussions on the liberalization of public services.

 

The EU and its 28 member states have strict policies for the supervision of hospitals and schools. It is true that thousands of people work in these sectors.

 

Some people fear that with TTIP, the EU will not supervise the health and education sectors anymore. As a result people will lose their jobs. That is incorrect. The negotiation mandate of the EU (published here) does not allow the EU to give up its powers in this domain. This ensures that public authorities retain decision-making powers over health and education.

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r

Myth: Regulatory cooperation in TTIP will initiate a regulatory ‘race to the bottom’.

Fact: Regulatory cooperation is not about lowering protection but about making regulations more compatible.

Some stakeholders are concerned that TTIP could lead to a ‘race to the bottom’ on environmental standards and consumer protection. However, such worries are based on the false premise that the EU and the US intend to agree on common regulations based on a ‘lowest common denominator’ approach. This is not the case!

 

On both sides of the Atlantic, governments have put in place regulations to protect their citizens. In fact, their efforts have been so successful that the EU and US regulatory systems are among the most advanced in the world.

 

Levels of protection on either side of the Atlantic will not be lowered, nor will TTIP change how each side makes new regulations. TTIP will not impact on national government’s sovereign right to regulate in the public interest.

 

In some cases, difference in EU and US regulations are caused by the fact that governments take different democratic policy decisions. They simply don’t share the same objectives. Where this is the case, they will agree to disagree. In other cases, however, EU and US measures provide similarly high levels of protection. Here, the biggest difference between regulations is not the objective but the approach. Where regulations use different approaches to attain similar objectives, synergies can possibly be found to facilitate trade flows.

 

The latter is exactly what the EU and the US are trying to do in TTIP. The ambition is to reduce the number of unnecessary trade barriers by making regulations with similar objectives more compatible.

 

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s

Myth: EU rules to guarantee food safety and environmental protection will be lowered via TTIP.

Fact: At no time will European regulators be forced into unilaterally abandoning the precautionary principle approach

On food safety, some stakeholders quote US industry interests who say they will target certain EU rules (for example on GMOs) and the precautionary principle approach to regulation that is favoured in Europe. The target of certain stakeholders is one thing, the outcome of TTIP negotiations is another. The US will present its interests on these issues to the EU, however the status quo will remain as this is not up for negotiation on the European side. The EU's precautionary principle approach will be upheld. Furthermore, the US also applies the precautionary principle in some instances where it regulates goods and services.

 

On the environment, one of the main arguments is that TTIP will jeopardize EU targets on reducing CO2 emissions. Others say that the EU will be forced to accept the lower standards that are in force in the US. EU trade negotiators and politicians, ie. EU Member State Ministers and Members of the European Parliament, will hold oversight over the process of negotiations at all times to ensure that such dangers are avoided.

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t

Myth: The Commission negotiates in secrecy and there is no transparency in the process?

Fact: The European Commission has launched a range of initiatives to increase transparency.

 

Observers of trade negotiations know that these are always conducted on an inter-governmental basis, and that governments negotiate with each other behind closed doors. This is not the same thing as being secretive since efforts are made to be transparent. But a degree of confidentiality between negotiators is required to truly be able to ‘negotiate’ final outcomes.

 

In the case of TTIP, there are some concerns related to access to negotiating documents. The EU acts in accordance with EU regulations which support open access for the public, but which also recognize that there will have to be certain logical exceptions to this rule to ensure the authenticity of trade negotiations. [1]

 

On 9 October 2014, the Commission and the European Council published the negotiating mandate that the Commission received from the EU’s 28 Member State governments. EU Trade Commissioner Cecilia Malmström announced a wave of new transparency initiatives on TTIP on 25 November 2014.

 

[1]   Reg. EC 1049/2001 of 30 May 2001.

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Myth: Industry stakeholders are not transparent enough about the interests they are defending in TTIP.

Fact: Discussions on trade negotiations require some transparency, and TTIP is no different. But transparency cuts two ways.

 

The public debate around this important trade and investment agreement should be based on evidence and facts, and not myths that some groups rely on which have no basis in reality and distort debate.

 

All stakeholders should contribute to considerations on the merits of free trade so that arguments, both for and against TTIP, are aired in a rational and balanced way. Only this will provide a valid and informed result.

 

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