Concern is rising in the European public health community about the TTIP trade agreement, an agreement being negotiated between the US and the EU Commission to reduce barriers to trade. While there may be economic benefits, the agreement could have a health and environmental cost. The public health and environmental communities think it will weaken the power of governments to make laws to protect their citizens’ health and the environment.
A new breed of agreement
TTIP is one of a new breed of trade agreement, which began with NAFTA (a North American agreement) and includes TPP an agreement for the Pacific region and the USA and CETA between Canada and the EU. What distinguishes these agreements is that they seek to go beyond issues of tariffs and taxes on imports to consider laws made within countries including laws about standards that products must meet or how they may be advertised. The agreements also have a controversial mechanism for settling disputes that uses courts outside national jurisdiction called Investor State Dispute Settlement, or ISDS.
UK studies of health impact
The kinds of barriers to trade that would come under fire from TTIP, according to the UK’s Faculty of Public Health (FPH) are government policies and regulations about alcohol, unhealthy food, cigarettes, food safety and environmental standards.
In its report ,Trading health? the FPH summarises the likely results “Without urgent revision, TTIP poses a serious risk to health. It may increase tobacco related harms, particularly among young people; increase alcohol related disorders – worsening mental health and social disruption in the community; and it may restrict governments‘ ability to reduce consumption of unhealthy foods, associated with increased rates of obesity and related health outcomes. TTIP may also increase the cost of vital medicines.”
The London School of Economics (LSE) in the UK has analysed the effects of TTIP on health from an economic point of view and also concludes in its analysis, The Transatlantic Trade and Investment Partnership: International Trade Law, Health Systems and Public Health., that the TTIP has definite risks to health and could “negatively impact on the ability of government to regulate for public health improvement”. It says the agreement will extend businesses’ powers of complaint, the damages they can claim and brings in an extra power to intervene in policy making as well.
ISDS in action
The ISDS mechanism allows businesses to sue governments over potential losses resulting from government action.
An article by Lucy Reynolds and Martin Mckee from the London School of Hygiene and Tropical Medicine in the BMJ entitled Is the NHS really safe from international trade agreements? shows how ISDS might work in relation to health services. The case they discuss involves Slovakia and Austria and a bilateral agreement that contains a dispute mechanism similar to ISDS. Recently, Slovakia passed a law requiring health insurers to be ‘not for profit’ and was promptly challenged under the agreement by an Austrian health insurance company that had been operating in Slovakia. A technical point eventually overturned the case but Reynolds and Mckee say it shows how “indirect investors in public services may be able to penalise governments financially if they seek to roll back the market in healthcare”.
Tobacco companies have been quick to use ISDS to prevent anti smoking legislation. New cigarette packaging legislation brought in with the aim of reducing smoking has triggered two ISDS cases brought by tobacco companies against Australia and Uruguay. The second case is interesting according to FPH’s report, Trading health? because the treaty concerned tries to protect public health with the phrase “the Contracting Parties recognize each other's right not to allow economic activities for reasons…of public health”.
The EU Parliament has criticised the ISDS mechanism and has put forward an alternative to the Commission that is more democratic, public and transparent.
It is not only the actual court cases but the threat of potential cases that could prevent legislation being enacted. There are several examples of cases where a country has backed away from proposed legislation under threats from corporates under WTO and later trade agreements. This is called regulatory chill. Some examples are provided by Ronald Labonte and Matthew Sanger in “Glossary on the World Trade Organisation and public health:” and Sebastian and Hurtig in Moving on from NAFTA to the FTAA?: the impact of trade agreements on social and health conditions in the Americas.
- Guatemala vs Gerber foods.
Guatemalan laws do not allow pictures of healthy babies on its infant formula. But a challenge from US food giant Gerber through WTO, caused them to back down and accept them on imported products, according to Labonte and Sanger. Guatemala was trying to enact WHO guidance on breast milk substitutes.
- Canada vs Philip Morris International and R J Reynolds Tobacco International
Canada tried legislating on plain packaging on its cigarette packets, but the NAFTA agreement and a challenge by Philip Morris and RJ Reynolds and forced it to back down, according to Labonte and Sanger.
- Canada vs Ethyl Corporation.
In this case, Canada tried to ban Ethyl Corporation’s petrol additive MMT on health and environmental grounds and had, according to Sebastian and Hurtig, ‘strong evidence but not decisive evidence”. A challenge by Ethyl Corporation caused Canada to back away rather than lose a lot of money.
How can trade agreements be made more friendly to health?
This quick scoot through TTIP-like agreements and ISDS cases suggests that this new kind of agreement could seriously impact public health efforts if they are not modified.
Does it have to be this way? Could there ever be agreements that were more friendly to public health but also allowing freer trade? There could be, according to Labonte and Sanger and to the LSE. Both advocate more engagement and dialogue between public health and trade officials as the way to go, with health considerations being taken into account early on in the process.
Further Reading identified from Global Health database (links below for subscribers only)
Ruckert, A.; Schram, A.; Labonté, R.; Canadian Public Health Association, Ottawa, Canada, Canadian Journal of Public Health, 2015, 106, 4, pp e249-e251, 9 ref.
Walls, H. L.; Smith, R. D.; Drahos, P.; BioMed Central Ltd, London, UK, Globalization and Health, 2015, 11, 14, pp (21 March 2015), 43 ref.
Squires, A.; Oxford University Press, Oxford, UK, Health Policy and Planning, 2011, 26, 2, pp 124-132, many ref.
Mitchell, A.; Sheargold, E.; Rimmer, M.; BMJ Publishing Group, London, UK, Tobacco Control, 2015, 24, e2, pp e147-e153, 50 ref.
Friel, S.; Hattersley, L.; Townsend, R.; Annual Reviews, Palo Alto, USA, Annual Review of Public Health, 2015, 36, pp 325-344, 151 ref.
Crosbie, E.; Gonzalez, M.; Glantz, S. A.; American Public Health Association, Washington, USA, American Journal of Public Health, 2014, 104, 9, pp e7-e13
Harrison, J.; Aginam, O.; Harrington, J.; Yu, P. K.; Edward Elgar Publishing, Cheltenham, UK, The global governance of HIV/AIDS: intellectual property and access to essential medicines, 2013, pp 87-108, many ref.
Koivusalo, M.; Oxford University Press, Oxford, UK, Health Promotion International, 2014, 29, Suppl. 1, pp i29-i47, many ref.
Bozorgmehr, K.; San Sebastian, M.; Oxford University Press, Oxford, UK, Health Policy and Planning, 2014, 29, 3, pp 328-351, many ref.
Sy, D. K.; Stumberg, R. K.; BMJ Publishing Group, London, UK, Tobacco Control, 2014, 23, 6, pp 466-470, 51 ref.
Friel, S.; Gleeson, D.; Thow, A. M.; Labonte, R.; Stuckler, D.; Kay, A.; Snowdon, W.; BioMed Central Ltd, London, UK, Globalization and Health, 2013, 9, 46, pp (16 October 2013), 52 ref.
Crosbie, E.; Glantz, S. A.; BMJ Publishing Group, London, UK, Tobacco Control, 2014, 23, 3, pp e7, 126 ref.
Gleeson, D.; Lopert, R.; Reid, P.; Elsevier Ltd, Oxford, UK, Health Policy, 2013, 112, 3, pp 227-233