Nexus - 0701 - New Times Magazine-pages

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imposing 'pricing penalties’ on their goods and services. Since for a WTO dispute panel on the Massachusetts law. '! The 1996, for example, Massachusetts has imposed a 10 per cent Commission has also been criticised by the European Trade penalty on goods and services provided by companies with finan- Union Confederation and the International Confederation of Free cial interests in Myanmar. Formerly known as Burma, Myanmar __ Trade Unions for ignoring human rights abuses in Myanmar. Yet, is renowned for the brutal human rights abuses imposed upon citi- according to an EU spokesman: "Breaking WTO rules doesn't zens by its illegitimate military government. To date, Siemens, help anyone. The key thing in this case is the United States’ fail- Unilever and several Japanese companies are among those that ure to honour its international commitments." have been penalised by the Massachusetts legislation, and the law was cited as one of the main reasons for Apple Computer's withe | TNC INVOLVEMENT IN WTO NEGOTIATIONS drawal from Myanmar.* Transnational corporations have thus far been the main benefi- The Massachusetts-Burma law has come under attack both on _ciaries of WTO agreements. This is hardly surprising, as in many the US domestic front and internationally, particularly in the EU cases they have directly influenced the positions of the most pow- and Japan. The National Foreign Trade Council (NFTC), a coali- erful WTO members during the negotiation of these agreements. tion of some 600 US-based manufacturers and financial institu- This was certainly the case during the Uruguay Round of GATT tions, has taken the state of Massachusetts to court over the law.’ negotiations, when the bulk of the WTO agreements were shaped. Oil companies such as Texaco and Mobil have expressed their In addition to bringing Southern countries under the GATT and concern about the impact of such laws on their activities in its discipline, and putting new issues on the trade agenda, the Myanmar and other dictatorial regimes. Uruguay Round granted Northern TNCs expanded access to Seeking to distance itself from charges that the NFTC places developing-country markets. The seven-year Round, which economic interests above human began in 1986, helped Northern rights in Myanmar, a front group countries and their corporations to called USA Engage was set up with achieve further liberalisation in the assistance of Anne L. Wexler,* Transnational corporations have sectors where they had an advantage ead of the Washington-based a 1A (such as in services), and also Wexler Group consultancy.” USA thus far been the main beneficiaries introduced intellectual property Engage was officially introduced at of WTO agreements. rights and other protections for TNC an April 1997 press conference, activities. where it portrayed itself as a "broad- The most strenuous lobbying took ased coalition representing | This is hardly surprising, as in many § place in the United States. Not only Americans from all regions, sectors cases they have directly influenced did individual companies vie for and segments of our society".'° The general trade liberalisation and the group promptly began an intensive the positions of the most powerful opening up of markets, but industry lobbying campaign in Washington, WTO members during the coalitions were also created to push DC, against selective-purchasing ous for the inclusion of certain issues laws and other economic sanctions negotiation of these agreements. under the GATT regime. For exam- laced on corporations based on ple, the Coalition of Service social and environmental objectives. Industries lobbied for a new trade In Europe, European Round Table regime for services'* and the of Industrialists (ERT) companies, including Ericsson, Unilever Intellectual Property Committee worked to get the TRIPs (Trade- and Siemens, also viewed the Massachusetts law as a dangerous Related Aspects of Intellectual Property Rights) agreement on the recedent to be quickly crushed. Industry mobilised its forces to agenda. Industry influence was also evident in the composition of ressure the European Commission to challenge the US govern- the US delegation: the vast majority of members were from the ment to drop the Massachusetts law. Failing that strategy, corpo- corporate world. rations urged the initiation of action in the WTO. Japanese During the first years of the Uruguay Round, European busi- eavyweights such as M shi, Sony and Nissan—some of the ness lobby groups were not intensively involved in negotiations. biggest losers in the Massachusetts law—applied the same pres- EU industry launched a serious lobbying effort only when negoti- sure to the Japanese government. ations came to a deadlock over the agreement on agriculture. It thus came as no surprise in October 1998 when the European According to former ERT Secretary-General Keith Richardson: Union and Japan requested the creation of a WTO dispute panel, "What we tried to say to governments is: whatever the difficul- arguing that the Massachusetts law was discriminatory and in vio- ties are, the most important thing is to get the overall deal, lation of WTO rules on government procurement. Although the because that will bring benefits to the whole of European busi- EU suspended the WTO panel in February 1999 (perhaps as a ness. And the total picture is more important than the individual conciliatory move in its bitter banana war with the US govern- difficulties. It's quite a difficult message, and the only way you ment), it has threatened to revive the case if the US federal gov- _ really do it is with face-to-face meetings."* ernment does not take action against Massachusetts. While the ERT focused on national governments, UNICE, the The Massachusetts-Burma case brings up many critical ques- European industrial employers confederation, worked closely tions about national and local sovereignty and the precedence of — with the European Commission to bring the negotiations to a trade over social and environmental objectives. It also highlights close. UNICE analysts chewed all of the proposals over carefully, some of the inequities in the current balance of power within the before spitting industry's positions back to the Commission. EU. In September 1998, the European Parliament passed a reso- The following two case studies, on the TRIPs and the Financial lution calling upon the Commission to put an end to all trade, Services agreements, show in more detail how transnational cor- tourism and investment by EU-based companies in Myanmar. porations have worked to shape WTO agreements to their own The resolution also criticised the Commission's decision to call preferences. for a WTO dispute panel on the Massachusetts law. '' The Commission has also been criticised by the European Trade Union Confederation and the International Confederation of Free Trade Unions for ignoring human rights abuses in Myanmar. Yet, according to an EU spokesman: "Breaking WTO rules doesn't help anyone. The key thing in this case is the United States’ fail- ure to honour its international commitments.""* NEXUS - 13 of WTO agreements. DECEMBER 1999 — JANUARY 2000