by James Tweedie

THE European Union’s parliamentary trade committee agreed a resolution yesterday backing the TTIP trade deal, as long as the controversial investor-state dispute settlement (ISDS) clause is removed.

The Socialists and Democrats (S&D) bloc, which includes the British Labour Party, reached a compromise with the conservative European People’s Party (EPP) to remove ISDS from the proposed Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US.

ISDS would allow foreign companies to sue elected governments for loss of profits — even hypothetical losses blamed on government policy restrictions.

Instead the committee accepted EU trade commissioner Cecilia Malmstrom’s “permanent solution” to have disputes adjudicated by appointed judges in public hearings with an appeals mechanism, under the jurisdiction of the EU and its member states.

The resolution will be voted upon next month.

But anti-poverty campaign War on Want (Wow) accused centre-left MEPs of outright betrayal of the European people.

“Millions of people across Europe have said no to TTIP in the strongest trade campaign we have ever seen,” said Wow executive director John Hilary.

“Yet MEPs have turned their backs on their own constituents, choosing instead to side with the business lobbyists of Brussels.”

While the European parliament is not directly involved in negotiating the treaty, it has the power to veto any EU trade deal.Critics say that TTIP strips away sovereign powers and obliges governments to show how their policies will affect business. Negotiations have been conducted in secret.

There have been several well-publicised cases of companies suing states over laws protecting public health and the environment under the ISDS clause of the 1994 North American Free Trade Agreement.

But Labour MEPs hailed the new deal, claiming it fully excluded public services and sounded the death knell for ISDS.

“We are making it clear to the (EU) commission that setting high and binding standards and bringing an end to secret investor tribunals are essential elements of any EU-US trade agreement,” said S&D group international trade spokesman and Labour MEP David Martin.

“Labour MEPs are unequivocal on these issues and will continue to press for a progressive trade deal with strong social protections.”