[CTC] House Democrats To Scrutinize TPP For Compliance With May 10 Deal

[Arthur Stamoulis]

House Democrats To Scrutinize TPP For Compliance With May 10 Deal
Posted: November 12, 2015, Inside US Trade

House Democrats plan to carefully scrutinize the Trans-Pacific Partnership agreement in consultation with stakeholders to assess how its provisions on labor, environment, and pharmaceutical intellectual property (IP) measure up to the standards included in the so-called "May 10" agreement during the 90-day review period that kicked off Nov. 5, according to a Ways & Means staffer.

The May 10 deal, struck in 2007 between House Democrats and the George W. Bush administration, changed the labor, environmental, and IP provisions of U.S. free trade agreements in ways favored by Democrats. Ways & Means Democrats will hold a series of hearings on TPP issues beginning next week to review how the TPP dealt with issues important to members, including separate hearings on these three issues (Inside U.S. Trade, Nov. 6).

On labor, the May 10 deal required FTA partners to uphold in their laws and regulations the fundamental labor rights identified in the 1998 International Labor Organization Declaration on Fundamental Principles and Rights at Work. It also subjected all of the labor commitments to full dispute settlement.

The TPP labor chapter generally reflects the May 10 template, with modest improvements, according to the staffer.

It makes three main changes from the May 10 model. The first is a new obligation in Article 19.3.2 for parties to adopt and maintain laws and regulations "governing acceptable conditions of work with respect to minimum wages, hours of work, and occupational safety and health." A footnote explicitly states that each party retains the ability to determine what it considers to be acceptable conditions of work.

The other two additions are new obligations for parties to not derogate from their laws implementing the fundamental labor rights and acceptable conditions of work in export processing zones, and for parties to discourage the importation of goods into their territory that were produced in whole or in part by forced labor.

In addition, the staffer said congressional Democrats were pleasantly surprised with the labor consistency plan the U.S. negotiated with Vietnam, specifically its enforceability and a provision under which the U.S. can suspend tariff cuts after year 5 of implementation if Vietnam is not allowing independent unions to affiliate across sectors or create a national federation (Inside U.S. Trade, Oct. 9).

But the staffer said Mexico's unwillingness to agree to a similar labor action plan under TPP is a problem, although he noted that the Obama administration is still pressing the Mexican government to agree to labor reforms (see related story).

The TPP environment chapter takes a different format than the May 10 agreement by not incorporating the seven multilateral environmental agreements (MEAs) that were part of that deal, but covering a broader scope of issues, according to the staffer. It does so through its inclusion of a ban on certain types of fisheries subsidies and other conservation commitments, he said.

But some of the conservation commitments do not appear as strong as the fisheries subsidies ban, as they include weak verbs like "promote" and "take measures to," the staffer argued.

Article 20.17.5 of the TPP employs such language in relation to combating trade in plants and wildlife that have been illegally obtained. "[E]ach Party shall take measures to combat, and cooperate to prevent, the trade of wild fauna and flora that, based on credible evidence, were taken or traded in violation of that Party's law or another applicable law, the primary purpose of which is to conserve, protect, or manage wild fauna or flora," the article states.

Environmental advocates had hoped for stronger language that would have obligated TPP countries to put in place laws banning trade in illegally obtained plants and wildlife, similar to the Lacey Act in the United States.

Making a full evaluation of how the TPP environmental provisions stack up to May 10 will require consulting with stakeholders to determine what are the biggest threats to the environment and how effectively the TPP addresses them, the staffer said.

The staffer noted that the pharmaceutical IP provisions of TPP differ from the May 10 deal in the sense that they do not establish different standards of protection for developed and developing countries. But the transition periods and certain other reservations in the text could help mitigate that, the staffer signaled.

One such reservation is language that allows Peru keep the May 10 standard making its five-year data exclusivity period for pharmaceuticals "concurrent" with the similar period in the United States.

The language refers to the requirement under the May 10 agreement that the five years of data exclusivity for the developing country FTA partner begin as soon as the brand-name drug receives marketing approval in the United States, as long as the developing country approves the application for marketing approval within six months of submission. This is one of the changes in the May 10 deal that was aimed at speeding up introduction of cheaper generic drugs to the market.

One element of the TPP that falls short of the May 10 deal is its obligation that governments provide extensions to patent holders to compensate for "unreasonable" delays in processing the marketing approval for a pharmaceutical product. The May 10 deal made it optional for developing countries to provide this type of patent term extension.

On MEAs, the May 10 language on the environment required FTA partners to "adopt, maintain, and implement" laws, regulations and other measures to fulfill their obligations under any of seven specific MEAs to which they and the U.S. are both parties, as well under as any future amendments to those deals, and subjected this commitment to the normal dispute settlement procedures of the FTA.

By contrast, the TPP explicitly requires countries to adopt, maintain and implement laws and regulations to fulfill their obligations under just one of those MEAs, the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).

Also included the TPP text are the core obligations of two of the other May 10 MEAs -- the Montreal Protocol on Ozone Depleting Substances and the Convention on Marine Pollution -- although the agreements themselves are mentioned only in footnotes rather than the core text.
Specifically, the TPP text requires signatories to take measures to prevent marine pollution, and take measures to control the production and consumption of substances that deplete or modify the ozone layer in a manner that adversely affects human health.

Footnotes specify that these obligations pertain to the MARPOL and the Montreal Protocol, "including any future amendments thereto." Other footnotes state that a TPP party shall be deemed in compliance with these obligations if it maintains a law or regulation listed in the chapter's annexes on ozone and marine pollution. Those annexes lay out the specific measures that each country has put in place to implement these two MEAs as they exist now.

The footnotes stating that the measures in these annexes are deemed to be in compliance with the TPP obligations on marine pollution and ozone layer signal that the Office of the U.S. Trade Representative has determined that these measures are sufficient to uphold and maintain parties' obligations under MARPOL and the Montreal Protocol.

That effectively satisfies that May 10 standard that countries uphold and implement their obligations under these two MEAs.

The other part of the May 10 obligation was for countries to "maintain" their laws upholding these MEAs commitments, meaning they cannot roll them back. That aspect of May 10 can be deemed to be met through the general obligation in Article 20.3.6 for parties not to waive or derogate from its environmental laws "in a manner that weakens or reduces the protection afforded in those laws in order to encourage trade or investment between the Parties.”

One area of apparent inconsistency under the TPP formulation for MARPOL and Montreal Protocol is whether countries would be required to implement in their domestic measures any amendments or changes to these agreements. For instance, the U.S. State Department announced on Nov. 5 that parties to the Montreal Protocol will negotiate an amendment that will expand the scope of the agreement to include hydrofluorocarbons, a greenhouse gas.

On the one hand, TPP parties' domestic measures listed in the annexes on ozone and marine pollution presumably only relate to implementing the current versions of MARPOL and the Montreal Protocol. On the other hand, the footnotes stating that the obligations pertain to MARPOL and the Montreal Protocol as well as future amendments could give a dispute settlement panel enough confidence to conclude that negotiators intended the obligations to extend to amendments.

USTR has claimed that other TPP countries were reluctant to completely incorporate MARPOL and Montreal Protocol -- as well as the other MEAs -- into the agreement in part because their environment ministries did not want issues within their jurisdictions to be handled by trade negotiators.

The other four May 10 MEAs not mentioned in the TPP deal are the Ramsar Convention on Wetlands and Waterfowl; the Convention on the Conservation of Antarctic Marine Living Resources; and the Inter-American Tropical Tuna Convention; the International Convention for the Regulation of Whaling.

USTR has argued that the issues covered under these MEAs -- wetlands conservation, fisheries management and preservation of marine mammals, respectively -- are dealt with under the TPP environment chapter, although critics point out that the language on these issues is aspirational and nonbinding.


 
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.citizenstrade.org/pipermail/ctcfield-citizenstrade.org/attachments/20151113/de492a78/attachment.htm>