26 October 2017

France puts ‘climate veto’ on EU-Canada trade deal

France announced today that it will only ratify the Comprehensive Economic and Trade Agreement (CETA) with Canada as long as it makes sure that the trade deal will not affect policies and regulations addressing climate change.

Environmentalists have long expressed concerns about the international trade agreement, especially over some controversial measures in an investment protection scheme.

More specifically, the measures allow private companies to pursue legal arbitration by creating a supranational court intended to deal with complaints from companies that feel aggrieved by the decisions of a State that have ratified the agreement.

This raised concerns over whether powerful multinationals would sue governments over environment and health regulations and their ability to use this clause for leverage to pressure Governments against environmental measures.

On June 2017, the French Government assigned a commission of independent experts to submit a report evaluating the impact of the EU-Canada trade deal in the field of environment, climate change, and health.

The report confirmed these allegations by saying: "There is obviously a tension between the risk of protectionist instrumentalisation of environmental and health policies on the one hand and the risk that private interests will question existing public regulations and block their reinforcement on the other hand".

In the wake of the report submitted last month, the French Environment Minister, Nicolas Hulot said that he has to ensure that climate policies are not hindered by investors.

He said:  “We will put in place what you might call a form of climate veto”.

“This would assure that from the moment the measures are put in place, our climate commitments could in no case be attacked by investors, notably in arbitration tribunals”.

The expert report concluded, among others that the French Government ought to make sure that the closes of the deal are in line with environmental protection and the goals of the Paris Agreement.

Nicolas Hulot also stressed that “no restrictive engagement was noted” regarding the environmental sector.

“It’s not only an issue of new risks introduced, but mainly an issue of lost opportunities”.

Regarding climate policies, the report remarks that “nothing is in place to limit trade of fossil fuels and the increase of emissions from the international sea and air transport sectors”.

Nicolas Hulot didn’t share any details on how the ‘climate veto’ will be put in place concretely, but he reassured his strong intention.

France is expected to ratify the Comprehensive Economic and Trade Agreement (CETA) during the second half of 2018.

You can access the full assessment report here

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