Social democrats propose dangerously flawed ISDS reforms

Social democratic ministers from six EU countries published reform proposals for the highly controversial investor-to-state dispute settlement (ISDS) mechanism. ISDS gives foreign investors the right to bypass local courts and use international arbitration to fight out conflicts with states. The claimants have a 50% influence on the make up of the arbitral tribunals. For the short term the social democrats from Germany, Sweden, The Netherlands, Luxembourg, Denmark, and France propose to ratify the agreements with Canada and Singapore. These agreements are seriously broken. Continue Reading →

Malmström has no idea how TTIP affects patenting

EU Trade Commissioner Malmström addressed a question from MEP Adam Gierek on TTIP effects on transatlantic patentability differences. The Commissioner did not actually answer the question of the Polish social democrat and responded with routine information: “Notwithstanding patent protection granted by US law to computer programs, our current international obligations ensure copyright protection in both parties.”

Continue Reading →

The German Störerhaftung of Wifi

It does not feel good when you are exposed to risks. Exactly this happens, exposure to potential liabilities, when you share your Wifi connection in Germany with others. Störerhaftung, secondary liability. As a result you hardly find public open wifi spots anymore as we used to have them all over Germany in the early days.  The legal situation is actually quite mixed and the government prepared a new draft law that would not resolve the issue. In the case of the FFII e.V. it went like this, we had an open wifi in the office even when it was starting to get uncommon. Continue Reading →

TPP ISDS is rigged to advantage U.S.

Wikileaks has released the “Investment Chapter” from the secret negotiations of the TPP (Trans-Pacific Partnership) agreement. It contains the highly controversial investor-to-state dispute settlement mechanism (ISDS), which makes it possible for multinational to sue states for international tribunals. For a first analysis see Public Citizen. I will point out one aspect of the TPP ISDS section: it is rigged to the advantage of the U.S.

Rigged

The International Centre for Settlement of Investment Disputes (ICSID) is the most used ISDS forum. Investors can choose this forum: article II.18.3 (a) and (b) TPP ISDS text. Continue Reading →

International investment court plan threatens our democracy

The European Commission investigates a permanent international investment court as a replacement of the controversial investor-to-state dispute settlement mechanism (ISDS). The plan for a court and the road map towards it are fundamentally flawed. To protect our democracy the European Parliament has to reject both ISDS and court. Former vice-president of the European Commission in charge of justice and now member of the European Parliament international trade committee Viviane Reding proposed to replace ISDS with a permanent international investment court. Commissioner for Trade Malmström supports the idea. Continue Reading →

Commissioner Malmström defends rigged ISDS in CETA

Today EU commissioner Malmström gave a speech in the European Parliament trade committee on investor-to-state dispute settlement (ISDS). ISDS gives foreign investors the right to use arbitration against states, instead of using local courts. Malmström made clear that she does not want to change the trade agreement with Canada (CETA), which contains a highly controversial ISDS section. The CETA text was used for the ISDS consultation. If CETA is ratified, multinationals from the US and other countries will be able to use the ISDS mechanism in CETA against the EU and its member states. Continue Reading →

EU published 2 year old TiSA mandate

Today the EU declassified a two year old mandate of the member states to the European Commission to negotiate the services agreement TiSA. These mandates are drafted by the European Commission and approved by the member states in the European Council and authorise the European Commission to negotiate with third countries. The declassification shows that data flows are among the negotiated subject matters, a controversial item in a post-Snowden world. Continue Reading →

Vrijschrift letter highlights dangers ISDS in CETA and EUSFTA

A Vrijschrift letter to the Dutch Parliament highlights the dangers of investor-to-state dispute settlement (ISDS) in the trade agreements with Canada (CETA) and Singapore (EUSFTA). On 25 March EU trade ministers will meet (informally) to discuss trade agreements and ISDS. In preparation, the Dutch Parliament trade and development committee meets on 11 March. Today Vrijschrift has sent this committee a letter. Original in Dutch, translation:

Dear members of the BuHaOs committee,

On March 11 you will discuss trade agreements. Continue Reading →

Unitary patents and software

The European Commission acknowledges that the unitary patent is not safeguarded against the granting of software patents by endorsing the EPO teaching:
21. Will the new unitary patent regime facilitate the patenting of computer programmes? The patentability requirements for European patents with unitary effect are identical to those of “classical” European patents. The envisaged regulation on unitary patent protection does not contain any particular disposition or derogation on the patentability conditions for inventions. As to the patentability of software, Article 52(2) of the European Patent Convention provides that programs for computers do not constitute a patentable invention. Continue Reading →

White House defends ISDS

United States Senator Elizabeth Warren turned against investor-to-state dispute settlement (ISDS): “Why create these rigged, pseudo-courts at all?” Jeff Zients, director of the National Economic Council, posted a response to Warren on the White House website. In turn, Simon Lester, trade policy analyst with Cato’s Herbert A. Stiefel Center for Trade Policy Studies, refuted his arguments. I would like to add a point that does not play a role in the debate in the U.S.: ISDS is rigged to the advantage of the U.S. While this may seem advantageous to the U.S., it can turn against the U.S.

Rigged

The International Centre for Settlement of Investment Disputes (ICSID) is the most used ISDS forum; investors can choose this forum. In practice the US appoints the president of the World Bank. Continue Reading →

VATMESS – EU harmonisation gone wrong for SaaS

Since 1 January 2015 online traders in the EU, selling items like “laser swords” in an app, have to apply the applicable value-added tax (VAT) rate to their purchases and submit the tax to the applicable tax authority of the responsible European member state. The new rules affect “laser swords”, document templates and SaaS but not traditional ecommerce trade of physical goods. Fortunately there is a “mini-one-stop-shop”, that is a single point of contact, subject to your registration, to declare and distribute the VAT. For your apps you have to engineer complicated solutions to determine the applicable member state of a net customer. The situation gets easier when your customer is a company with a VATIN, that is the European number of a VAT registered company. Continue Reading →