TRADE DEALS IN JEOPARDY — TISA

by Crista Huff

 

Trade ministers will gather to continue negotiations on the Trade in Services Agreement (TiSA), November 2-10 in Geneva. TiSA is targeted for signature by international trade ministers, December 5-6, followed by the individual countries’ ratification votes. TiSA is a trade agreement between 23 members of the World Trade Organization.

Some say that the ministerial signing of TiSA will not likely meet the early December deadline, due to strong U.S. opposition to various facets of the agreement, including a U.S. proposed ban on data localization that will cover financial services firms. The outcome of the TPP ratification vote in the U.S. will also hinge heavily upon the outcome of a data fix.

EU countries are also at odds with other TiSA partner countries over cross-border data flows, a data localization ban, annexes on electronic payment and delivery services, reinsurance; and how TiSA will deal with new services, for which the EU wants a carveout. There are also TiSA partner countries that would hesitate to participate in TiSA if the TPP ratification vote fails in the U.S. during a lame duck session of Congress.

Due to recent delays in CETA approvals, the European Commission is behind schedule on a data flow proposal, now expected in late November. The Commission prioritized the signing of CETA over continued negotiations of TiSA. “The EU has not been able to negotiate language on data flows in the TISA talks because the European Commission’s departments on trade and justice have been negotiating a unified position. This has also prevented the EU from being able to take a stance on the U.S.-proposed ban on data localization measures for financial services firms.” (Inside U.S. Trade, 10-13-16, subscription only)

At issue are the EU’s data protection rules, which are more stringent than those of other countries. TiSA partner countries could potentially take the EU to global court, alleging that the EU’s higher standards are not fair to countries with lower standards. And therein lies one of the inherent problems with multi-country trade agreements. A simple lawsuit can force countries to change the ways that they do business, dragging them down to the quality of lowest-common denominator partner countries. We saw this situation play out with food labeling rules under NAFTA. The U.S. was forced to remove country-of-origin labeling on U.S. beef, because Mexico and Canada complained that the “U.S.” label gave an unfair advantage to U.S. beef products.

Who gets to decide what is fair? A global court, whose decisions supercede the will of the American people and the U.S. Congress, with no opportunity for appeal. When the U.S. signs trade agreements, we give up degrees of sovereignty. The bigger the trade agreement, the more sovereignty we lose. And in the case of TiSA, there is a strong possibility that Congressional approval of TiSA will not be required in order to finalize the international agreement!

 

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Crista Huff is a stock market expert and a conservative political activist. She works with End Global Governance and issues groups to defeat the Trans-Pacific Partnership trade agreement. Send questions and comments to research@goodfellowllc.com.