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European Parliament resolution on openness and democracy in international trade (2001/2093(INI))
International Trade
A5-0331/2001
Text adopted by The
European Parliament 25 October
434 for - 10 against - 1 abstention.
The European Parliament,
– having regard to its resolutions of 4 May 1999 on multilateral commercial relations: the European Union and the developing partner countries of the European Union , of 18 November 1999 on the communication from the Commission to the Council and the European Parliament on the EU approach to the WTO Millennium Round (COM(1999) 331 – C5-0155/1999 – 1999/2149(COS)) , of15 December 1999 on the Third Ministerial Conference of the World Trade Organisation in Seattle and of 13 March 2001 on the WTO Built-in Agenda negotiations ,
– having regard to the setting up of a 'WTO parliamentary assembly' steering group within the European Parliament on 26 October 2001, to the fact that various preparatory meetings have already taken place, that a parliamentary conference will be held in Doha (Qatar) and that the steering group is broadly responsible for coordinating the Doha conference,
– having regard to Rule 163 of its Rules of Procedure,
– having regard to the report of the Committee on Industry, External Trade, Research and Energy (A50331/2001),
A. whereas international trade has made a major contribution to job and wealth creation; however the benefits have not been evenly spread; the least developed countries' share of world trade has declined and many developing countries are encountering export problems such as high tariffs, quotas and limited capacity in information and communication technologies,
B. whereas freer but also fairer and more sustainable world trade must be consolidated under the multilateral system and within a reformed WTO; whereas a rule-based system is the only way of ensuring in a peaceful and equitable manner that its benefits accrue to all nations; whereas international rules and institutions are required to deal with the interaction between trade and other areas such as the environment, health or social standards,
C. whereas the multilateral trade system is based on the GATT rules, drawn up in 1947, whose preamble says that 'relations in the field of trade and economic endeavour should be conducted with a view to raising standards of living, ensuring full employment…' and the agreement goes on to state that 'the attainment of these objectives is particularly urgent for less-developed contracting parties', and the preamble to the 1994 agreement establishing the WTO added that these objectives must be pursued 'in accordance with the objective of sustainable development, seeking both to protect and preserve the environment',
D. whereas the creation of the WTO following the conclusion of the Uruguay Round in 1994 marked a radical change in the multilateral trade system by extending its jurisdiction to a wide range of new areas and strengthening its rules by establishing a mechanism for effective sanctions,
E. whereas there is a great need to enhance the participation and influence of legislators in the work of international organisations such as the WTO,
F. whereas the WTO's main role is to provide its members with an institutional framework for talks, the settlement of disputes and negotiations on trade rules, at both bilateral and multilateral level,
G. whereas the WTO is an intergovernmental organisation which is in principle run entirely by its member states, but in fact some of them are marginalised because of non-inclusive working methods or because they are not, or not effectively, represented in Geneva owing mainly to insufficient technical assistance and funding,
H. whereas implementation of the Uruguay agreements has given rise to serious disappointment in the developing countries because of the conditions for application of the agreements by the industrial countries and by the developing countries respectively, the cost of applying certain agreements, and the non-participation of many developing countries in decision-making within the WTO,
I. mindful of the recent initiative by the WTO Director-General to set up an advisory group of experts tasked with drawing up reform proposals,
J. whereas the first few years of operation of the WTO have given rise to considerable public concerns, which were expressed at the Seattle Conference with regard to the taking into account in trade policy of issues such as environmental protection, observance of the precautionary principle, compliance with social standards, access to medicines for AIDS patients in the developing countries or the limits to the marketing and patentability of living organisms in particular,
K. mindful of the ILO Director-General's proposal of 11 June 2001 to set up a commission on the social dimension of globalisation which will be established after the ILO's final decision in November 2001,
L. whereas clarification is needed on some clauses of the agreement on services, to make clear that WTO rules do not impede the right of Member States to regulate and intervene in services of general interest,
M. whereas concern among many citizens about the WTO reflects the fear that its rules may allow trade considerations to override other legitimate objectives of public policy, and to undermine the democratic process itself,
N. whereas Article 177 of the EC Treaty refers to solidarity with the developing countries and the European Union must make an effective contribution to defining the outlines of a form of governance for development involving rapid reforms to WTO rules,
1. Notes that the world trade system currently suffers from unequal participation, the uneven distribution of the benefits of world trade, the ambiguity of some of its rules and their impact on non-trade issues, a lack of internal and external transparency, and a low level of involvement of parliaments and civil society in the work of the WTO; insists that broader reform is needed than has so far taken place;
2. Notes that the WTO is not the only component of the world trade system, considers that the same principles of openness and democracy should be applied pari passu to plurilateral, regional and bilateral trade agreements and calls on the Commission to observe such principles in all its bilateral and international trade negotiations;
Legitimacy, equal participation, internal transparency, capacity building
3. Points out that the democratic legitimacy of the WTO, an intergovernmental organisation, in principle relies firstly on the equal participation of all members in decisions; notes, however, that none of the 24 developing countries that are WTO members have a permanent representation at WTO headquarters in Geneva and that many other countries have only very small delegations which do not enable them to follow all the work that concerns them; considers it vital to remedy this marginalisation and to ensure effective participation of all members in the working of and in decision-making within the WTO;
4. Notes also that many negotiations take place in small groups from which poor countries are in reality excluded;
5. Is concerned at the difficulties encountered by non-member LDCs involved in accession procedures and at the level of commitment demanded of them which is higher than that of existing member countries; asks the Commission to revive its proposal for a fast-track accession procedure;
6. Calls on the Commission and the EU Member States to support the efforts of the developing countries to set up joint permanent regional representations at the WTO and to continue to provide support in this respect to the ACP countries and to resource centres such as the 'Advisory Centre on WTO law';
7. Calls on the Commission, in international organisations and, in particular, at the WTO, to place greater emphasis on the interrelationship between favourable economic development, trade regulation and the development of social competence at state level and, in this connection, to submit a report to the European Parliament in the spring of 2002 that looks into the interrelationship between trade theory, social competence and sustainability in trade;
8. Calls on the Commission to propose, on behalf of the EU, to mainstream existing trade-related technical assistance, to identify the gaps for developing countries and to strengthen the WTO’s budget, on the basis of a contribution proportional to each member’s share of international trade, to enable all members of the WTO to have fair representation in Geneva and to increase the resources available for technical assistance to developing countries and, in particular LDCs;
9. Calls for a commitment by the world leaders gathered at the WTO to coordinate measures to help developing countries tackle the impediments to growth in their trade as concerns flows of information, protection of property rights, institutions for efficient repayment of loans, access to the judicial system for the poor and illiterate, access to open bank accounts, non bureaucratic registration of companies and partnerships, and the lack of small business clubs at village and district levels to solve problems alongside national decision-makers;
10. Calls, pending permanent representation of all members in Geneva, for the strengthening of the existing early warning system, to be established to enable non-resident countries to be informed at a sufficiently early stage that new negotiations or decisions are to be submitted to a particular body so that they can prepare themselves and for the planning of meetings within the WTO to enable all delegations, even the smallest, to participate or to be represented; requests that all members should have rapid access to records of meetings of bodies (councils, committees, working parties, etc.) in which they have been unable to participate and to all the information they need to follow the work under way in the various bodies;
11. Asks that the provisions on special and differentiated treatment in trade agreements for the promotion of certain specific interests of the developing countries and for the provision of technical assistance to these countries be made operational and effective;
12. Calls on the Commission to ensure that the technical assistance and capacity building programmes within the 'Integrated Framework' help the LDCs not only to apply the agreements, but also to defend their interest better in negotiations from the point of view of their development strategy and to influence the formulation of trade policies; asks that the strengthening of analytical capabilities should be addressed as a matter of urgency in the first stages of new multilateral trade negotiations;
13. Notes that the TRIPS agreement is the only WTO agreement containing substantial provisions enjoining, like a 'directive', the WTO member countries to amend their internal legislation in an area under their national jurisdiction;
14. Asks the Commission to ensure better coordination between multilateral and bilateral donors, particularly EU Member States, in the area of technical assistance to the developing countries;
15. Regards the WTO dispute settlement system as a particularly sensitive element of the trade system and international relations; is concerned at the growing number of disputes and is convinced that political relations between countries cannot totally be replaced by judicial relations and invites parties involved in trade disputes to try to find political solutions and compromises; proposes in this connection that Article 7 of the Dispute Settlement Understanding be revised to encourage compensation schemes, including temporary ones, rather than recourse to sanctions;
16. Draws attention to the inequalities between member countries with regard to the sanction established by the dispute settlement system; proposes therefore that Article 7 of the disputes settlement agreement be revised to encourage the use of financial compensation schemes to remedy these inequalities;
17. Regards the proposals on improving the functioning and transparency of the WTO forwarded to the General Council of the WTO by the Commission on 26 July 2000 as a starting point that can be fleshed out with a view to the fourth Ministerial Conference in November 2001;
18. Is concerned that a lack of clarity in some parts of the WTO agreements has led to an excessive reliance on the disputes procedure to interpret and clarify agreements; therefore calls for clearer agreements, to allow the disputes procedure to operate more predictably on the basis of texts negotiated by governments and ratified by parliaments;
19. Calls on the EU to propose to other members the establishment of clear rules on informal consultations: the latter should be initiated by the chairman of a WTO body or its DG, the agenda and list of participants should be distributed to all members and no country should be excluded if it wishes to participate; calls for sufficient time for all delegations to undertake consultations with capitals and for the results to be the subject of a formal report to the relevant WTO bodies and communicated to all members which would increase the balance between transparency and efficiency;
20. Underlines the importance of an intellectual property system that encourages technology transfer towards developing countries with particular reference to the knowledge-based society; is well aware, however, of the difficulties faced by developing countries in implementing the TRIPS Agreement and reiterates therefore its call on the WTO and the Commission to step up technical assistance in this area and calls also for a detailed re-examination of the impact of the TRIPS agreement on developing countries, including its effect on the transfer of technology, access to medicines and the protection of traditional knowledge, and its conformity with the Convention on Biodiversity and the Protocol on Biosafety;
External transparency and openness
21. Considers that transparency in the formulation and conduct of trade policy is a legitimate demand of society, citizens and parliamentarians;
22. Points out that within the WTO a general rule of openness should apply meaning that the vast majority of documents should be derestricted and published on the WTO website and supports the Commission proposal that all documents, records and decisions should be published;
23. Considers that meetings of WTO bodies should be open to observers from other multilateral organisations and NGOs, in accordance with accreditation procedures similar to those implemented by other international organisations; believes that Webcasting could also be used;
24. Considers that NGOs should be able to submit analyses and written or oral proposals to the various WTO bodies under arrangements to be defined for each of the bodies concerned (General Council, other councils, committees, etc.) as is the practice in other international organisations; calls therefore on the member states of the WTO to ensure that proper democratic accountability is guaranteed;
25. Advocates, in the dispute settlement procedure, that substantive meetings with the parties, meetings of panels and the appellate body, given the judicial nature of the procedures, should in future take place in public, as is customary in court proceedings, and documents, in particular submissions by parties or experts, should be made available to the public, except in rare duly substantiated exceptional cases; calls for the creation of a legal aid office financed from the WTO budget to assist the least well represented countries in acceding to the DSB;
26. Proposes that explicit provision should be made in the dispute settlement procedure for the possibility of panels receiving "amicus curiae" or amicus briefs from NGOs, particularly on social or environmental issues, but that such submissions should be carefully circumscribed in their length, status and admissibility so that the legitimate rights of developing countries in the dispute settlement process are protected and unnecessary procedural complexity is avoided, while ensuring that this does not become a mechanism for promoting private commercial interest;
27. Insists that some external bodies such as the "Codex Alimentarius", on which the WTO relies for external advice, also require radical reform to restore public confidence and meet elementary standards of openness;
Parliamentary and public scrutiny and parliamentary forum
28. Proposes once again the creation of a parliamentary Assembly within the WTO with consultative powers and instructs its delegation to the WTO Ministerial Conference in Doha to organise, in close cooperation with other parliamentary organisations, a meeting of the parliamentarians present to promote this initiative;
29. Considers that the Assembly should be able to receive regular written and oral reports from the WTO and to present proposals to the General Council or other organs of the WTO; considers also that it should provide a forum in which trade policy can be opened up to wider scrutiny and debate with society at large;
30. Calls on WTO members and the WTO to provide sufficient support for their parliamentarians to take part in the development of the parliamentary dimension of WTO; stresses the need for a provisional infrastructure for the parliamentary Assembly until WTO assumes its responsibilities in this respect and, at the same time, offers the necessary facilities for this purpose;
31. Considers that, in the interests of democracy, the most important capacity-building measure is to assist WTO members in developing a democratic and pluralist approach to trade policy formulation and effective monitoring of trade policy; calls on the EU to encourage other WTO members to join it in producing a declaration of principles with regard to openness and democracy in trade policy-making; calls on the WTO secretariat to develop and disseminate best-practice guidelines on openness, consultation and pluralism in trade policy formulations;
32. Considers that it is also important to develop political debate at national parliamentary and existing regional Assembly level and stresses, therefore, the central importance of participation of parliamentarians in the decision-making process in order to carry out effective democratic control;
33. Notes that there is still a democratic deficit within the European Union in the area of trade policy, in that Article 133 of the EC Treaty excludes the European Parliament from defining and genuinely scrutinising the common commercial policy;
34. Calls once again therefore on the Member States to revise the provisions of the EC Treaty concerning the common commercial policy so as to guarantee full involvement of the European Parliament in this sphere, by providing for the European Parliament to be consulted on the negotiating mandates to be given to the Commission, opening up the 133 Committee to the European Parliament's representatives, and requiring the European Parliament's assent to all trade agreements;
35. Considers that the Trade Policy Review Mechanism (TPRM) in its current form does not satisfy the requirements of informed public debate; advocates therefore reform of the TPRM to include the social, environmental and development impact of trade policies and an evaluation of how trade policy is formulated and monitored, including the role of parliaments and civil society; calls for the participation of the European Parliament and civil society in the review process;
36. Considers that it is essential, not least for the WTO's legitimacy, that its rules should not prevent member countries from pursuing independent and ambitious policies and their parliaments from legislating freely and legitimately in the areas of public health, environmental and consumer protection, and the cultural and education spheres, but such policies should not lead to arbitrary erection of trade barriers, where such barriers are not necessary to achieve public policy objectives;
37. Urges, in this context, that the SPS Agreement on sanitary and phytosanitary measures be revised to spell out more clearly that the precautionary principle may be taken as the basis for non-discriminatory restrictive measures with a view to preventing, where there is scientific doubt, any risk to public health linked to a food product and/or method of production;
38. Calls for clarification of the scope of the GATS Agreement to ensure adequate protection that public and social services remain the legitimate concern of governments and calls on the Commission to deliver a political declaration clearly guaranteeing the protection of public and social services under regional jurisdiction;
39. Is concerned at the direct and grave effects of some dispute settlement cases on private third parties (particularly SMEs and consumers); considers that, on account of the lack of direct applicability of WTO law, such undertakings have at present practically no legal recourse available for seeking compensation from agencies of their state (or community of states) that have demonstrably been shown to be acting unlawfully by the WTO dispute settlement procedure; calls on the Commission, in cooperation with the Council both at the WTO and within the EU, to work to eliminate this shortcoming forthwith;
40. Proposes rewriting the description of qualifications for the recruitment of members of panels and the appellate body, so as to have a wider range of skills, in particular for the conjunction of trade and non-trade issues;
Coherence and new international architecture
41. Calls for the WTO's cooperation with other multilateral organisations to be strengthened, in particular with organisations responsible for social and environmental standards; requests that such organisations be granted observer status within the WTO and that arrangements be established to allow them to participate in WTO bodies; calls for the establishment of clear rules on the relationship between WTO Treaties and Multilateral Environmental Agreements (MEAs) such that WTO rules do not constitute an obstacle to the implementation of MEAs;
42. Draws attention to the importance of compliance with basic labour standards; calls for the ILO and its member states to make more vigorous use of its disciplinary mechanisms when such rights are abused; notes that the ILO's constitution permits the imposition of trade sanctions; recalls that the ILO must have the sole power of authorising trade sanctions linked to violation of core labour standards and calls on the WTO to make clear that trade sanctions imposed pursuant to an ILO decision regarding abuse of labour rights could not be considered incompatible with the WTO Treaties; calls for a plurilateral agreement within the WTO on incentives to encourage compliance with the ILO's core labour rights;
43. Calls for the dispute settlement procedure to be revised to provide that, in cases involving non-trade issues covered by other international conventions, the panels or the appellate body should seek the opinion of the relevant international organisations and that this opinion should be published and appended to the ruling;
44. Calls for the WTO and the United Nations to examine new relations between international organisations so as to ensure coherence in international regulatory agreements and conventions; affirms as a consequence, the need to establish a better balance between international laws and calls for the conclusion of a new agreement on MEAs which would insulate legitimate trade measures incorporated into MEAs from WTO challenge; calls on the Commission to make the relationship between the WTO's dispute settlement procedure, on the one hand, and such procedures under international agreements, on the other, an object of negotiation and to ensure that an appeal may be made to other obligations, e.g. under MEAs, in the WTO dispute settlement procedure;
45. Recommends the strengthening of the trade-related competences of other international bodies, such as the FAO, WIPO, the ILO, WHO and the MEA secretariats, in order to reconcile better trade considerations and international environmental, health and social standards; calls for the precautionary principle in the area of the environment and consumer protection to become an integral component of WTO rules;
46. Calls for an explicit reference to the objectives of the eradication of poverty, the promotion of equitable and sustainable development and environmental protection to be inserted at the fourth Ministerial Conference in Doha in the preamble to the Agreement setting up the WTO;
47. Invites the Commission, with a view to the fourth WTO Ministerial Conference in Doha, to propose the setting up of a working party within the WTO charged with submitted proposals for reform of the functioning of the WTO to the General Council and members as soon as possible;
48. Instructs its President to forward this resolution to the Council, the Commission, the parliaments of the Member States, and the members of the WTO meeting at the fourth WTO Ministerial Conference in Doha.