The scale of the EU's divisions on the controversial EU-US trade deal was laid bare this evening after the European Parliament postponed a key vote on the Transatlantic Trade and Investment Partnership (TTIP) agreement.
The European Parliament had been due to vote for the first time on Wednesday on the Transatlantic Trade and Investment Partnership (TTIP) , an ambitious trade deal between the European Union and the US.
But following disagreements over the inclusion of an investor protection clause which would allow companies to sue governments in certain circumstances, the vote was postponed.
Instead the European Parliament’s international trade committee will consider a number of amendments proposed by the Socialists and Democrats (S & D) group.
This week’s vote followed a vote in the trade committee two weeks ago, in which MEPs voted in favour of backing the European Commission’s proposed trade deal. The Parliament’s trade committee backed the resolution by 26 votes to 13.
But it appears that the chairman of the committee, socialist German MEP Bernd Lange, was unable to sell the proposal to the wider S & D group amid concerns about the inclusion of an investor state dispute settlement (ISDS) mechanism.
Negotiations between the S & D group and the European People’s Party (EPP) on further amendments to the proposal ended without agreement, forcing a postponement of the vote.
European trade Commissioner Cecilia Malmstrom has already made significant changes to the current ISDS regime, proposing the establishment of an international arbitration court, and a public appeals system. But the inclusion of rights for investors has become a lightning-rod for public opposition to the trade deal.
Plan for a multi-billion euro trade agreement were launched during the Irish presidency of the Council of the European Union two years ago, but have faced significant public opposition in countries such as Germany, Austria and France.
At the G7 summit earlier this week, US president Barack Obama and German Chancellor Angela Merkel urged for a swift agreement on the EU-US trade deal, with the German chancellor predicting that an agreement could be forged by the end of the year. Progress on both TTIP and the Trans-Pacific Partnership (TPP) - the US' proposed trade deal with pacific countries - has been held up in the US Congress, with the House of Representatives due to vote on the Trade Promotion Authority bill which would give the US president fast-track powers to conclude the negotiations.
Sean Kelly, the only Irish MEP on the international trade committee, said he believed that the deal would open-up huge opportunities for Irish SMEs.
“The standardisation of regulation would remove a major trade barrier for Irish businesses who frequently cite the need to comply with separate US regulations as one of the key barriers to doing business with the US.”
He added that the absence of any investor protection would be difficult for businesses. “Where would that leave businesses, big or small? You could have the situation where an Irish company invests in a renewable energy project in, say Nebraska, and if the state changes its focus to fossil fuel the business has no protection.”
While Fine Gael's four MEPs are supportive of the EU-US trade deals, Sinn Fein and a number of Independents are opposed to the deal.
Speaking earlier this week, Sinn Fein's Matt Carthy called on Irish MEPs to vote against the Investor State Dispute Settlement (ISDS) mechanism on Wednesday. "The ISDS mechanism allows private corporations and investors to sue the Governments of member states for potential loss of revenue" he said, adding that it is the means by which Canada was sued for its moratorium on fracking and Australia was sued for its public health measures on smoking.
“In the 45 cases taken under this type of mechanism to date, almost $5 billion of public funds have been paid out to Investors,” he said.
