States and small businesses shut out of international trade negotiations

Posted Saturday, May 17, 2014 6:46 am

MONTPELIER -- A pending international trade deal will affect businesses in Vermont and there's little the state can do about it, lawmakers said Friday.

A new transatlantic trade agreement being secretly negotiated between the U.S. and European Union could challenge state laws and policies ranging from tobacco regulation to GMO labeling to procurement practices and more.

"People don't know enough about it to be upset," Sen. Ginny Lyons, D-Chittenden, said Friday. "And the reason they don't know enough is because there's no transparency to the process."

Lyons was one of several lawmakers from Vermont, Maine and New Hampshire attending an International Trade & the Environment forum on Friday and Saturday in Montpelier. The event was presented by the National Caucus of Environmental Legislators. The goal of some speakers Friday was to raise awareness of how international trade agreements can affect state and local laws.

Brent Raymond, Vermont's international trade director, is privy to only very limited information about the trade agreements and other negotiations made through the World Trade Organization.

He said in an interview Friday that he's conflicted about the prospects of the agreement. He believes global trade can be done well, Raymond said, but he's got serious concerns about this negotiating process.

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"I have concerns about big tobacco's influence on TPP (Trans-Pacific Partnership) and WTO," Raymond said. Tobacco companies in the past have sued countries with strict cigarette marketing regulations, claiming the rules have hurt their business.

In addition to tobacco's influence, he's not seeing small businesses in the mix, in spite of the fact that small businesses -- from import/export companies to six person machine shops -- are increasingly competing in the global marketplace.

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"I just don't feel like they're adequately represented by the representatives of the U.S. to these discussions," Raymond said. "The larger multinationals weigh in a lot and have a heavy amount of influence."

International trade representatives will hold their fifth round of meetings May 19-23 in Arlington, Va. They'll also take questions and solicit input from stakeholders on the Transatlantic Trade and Investment Partnership (TTIP) between the U.S. and EU. A different international agreement, the Trans-Pacific Partnership (TPP) also is pending. Both are compared to the North Atlantic Free Trade Agreement, but on a much larger scale.

Both negotiations take place in secret.

Maine state Rep. Sharon Treat said she's virtually the only member of the U.S. Trade Representative's Intergovernmental Policy Advisory Committee who continually speaks up about the potential impact of the trade agreements on states.

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Treat can comment on trade documents in advance of negotiations, but is not allowed to share them or even seek counsel from subject-matter experts. And the committee is not updated after the negotiating process, so she never knows what's actually being discussed, she said.

This concerns her because international trade agreements have the potential to trump state and local laws. The agreements don't nullify state laws outright, but they open a door for international corporations to challenge state laws as being anti-competitive.

Raymond said, for example, that Vermont's net-metering program could be considered a "subsidy."

A foreign energy company that wants to enter the Vermont market may conclude that net metering constitutes an unfair market restraint. They could sue -- or threaten to sue -- and challenge the state not in U.S. court but in a closed-door international arbitration tribunal.

"So states' rights on a lot of different fronts are potentially at risk," Raymond said. "The problem is we don't know what's being negotiated."