EU’s New ‘Scrutiny Board’ To Implement Key US Demands For TAFTA/TTIP Even Before It’s Completed

Earlier this year, we discussed an interesting leak from December 2013 revealing discussions about the creation of a new transatlantic Regulatory Council as part of the TAFTA/TTIP agreement currently being negotiated. The central idea was to give a new body powers to vet proposed laws and regulations on both sides of the Atlantic, with a view to promoting trade and regulatory convergence — two of TTIP’s stated aims. Further leaks this year confirmed that negotiators are still working on implementing this idea in the agreement.

Now Corporate Europe Observatory (CEO) has obtained yet another leak, but not one from the TTIP talks. Instead, this is an internal document from the European Commission, which proposes setting up a similar regulatory body for the EU, independently of TTIP:

A new bureaucratic body is to have considerable power to stop the Commission from tabling proposals that don’t adhere to a set of business-friendly principles. Furthermore, the Commission wants to be able to pull an “emergency brake” if its proposals are significantly changed in the “wrong” direction by either the Council or the European Parliament — could be laws improving working conditions, could be environmental regulation. The leaked document is entitled “Better regulation for better results — An EU agenda”, ostensibly to be released later in May.

One aspect of the proposed system is that all new regulations would require impact assessments. Although that’s sensible enough, there’s a catch: if modifications are made to proposed regulations later on — for example by the European Parliament, which frequently amends texts in this way — that fact could be used to put a brake on the legislative process pending further examination:

Imagine if the European Parliament agreed with the Council on a compromise that would introduce more ambitious social or environmental goals to a law proposed by the Commission, for instance if a proposal that would ban a few “endocrine disruptors” due to a damaging effect to children would be extended to cover more substances. Such a scenario would then allow the Commission to pull the brake and call for an independent investigation. This would enable any business lobby coalition to regroup and focus on a particular outcome of the assessment, it could slower the procedure substantially, and possibly change the upcoming law to its original, less ambitious form.

This would clearly act as a disincentive for MEPs to try to improve legislation, since doing so would lead to delays and more lobbying that might make it even worse. In this way, the proposed system would have a chilling effect on the more democratic parts of the European Union’s legislative process, and enhance the powers of the (unelected) European Commission.

Another important element of the proposal that is not quite what it seems concerns transparency:

It is striking how much the leaked document goes on about public consultation and transparency. “Lighten the Load – Have Your Say” reads the appealing slogan, depicting an ostensibly new style of open governance from the Commission, where business and citizens are to be able to comment again and again on a proposal at almost every stage of the decision process, starting from the very first inception of an idea.

That’s misleading because of parallel moves by the European Commission to strengthen and broaden the protection of “trade secrets,” as another report by CEO reveals. In practice, then, what greater “transparency” would really mean would be greater opportunities for businesses to lobby during all phases of drawing up new laws and regulations. The public, by contrast, would not have access to the full range of materials, some of which would be deemed “trade secrets.” What’s striking is that this one-sided kind of transparency is exactly what the US is asking for in TAFTA/TTIP:

This deregulatory push is also clearly related to TTIP, where both businesses and the US government have asked for more “transparency” and “stakeholder participation” in the EU at the very early stages of the legislative process, in fact well before a proposal is even presented to decision-making bodies.

Another key TAFTA/TTIP demand from the US side is the increased use of impact assessments — just as the new Scrutiny Board would require:

TTIP will boost the use of impact assessments, and will introduce an emphasis on the effect new legislative proposals might have on US companies, on whether it is in sync with US rules, and whether it supersedes international standards.

This “coincidence” suggests that the European Commission is already working on proposals that will meet US demands in TTIP, so that by conceding them — in theory — EU negotiators can obtain some of their key goals in return. That may already have happened elsewhere: there is speculation that one reason why the European Commission watered down its key Fuel Quality Directive (FQD) was to accommodate US demands in TTIP’s energy chapter. As the TAFTA/TTIP negotiations proceed, we can probably expect to see more proposals from the European Commission that pre-implement US demands in this way.

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