The European Court of Justice (ECJ) has concluded that including a so-called Investment Court System in the EU-Canada free-trade agreement is “compatible with EU law” – a ruling that ignores the gross injustices corporate tribunals inflict on EU citizens and the environment.

In an opinion released earlier this week, the European Court of Justice ruled that the controversial Investment Court System (ICS) introduced in the Comprehensive Economic and Trade Agreement (CETA) between the European Union and Canada was “in principle, compatible with EU law”, noting that “since those tribunals stand outside the EU judicial system, they cannot have the power to interpret or apply provisions of EU law other than those of the CETA”.

Although the ICS may comply with the letter of EU law, the European Environmental Bureau (EEB) strongly disagrees with the ECJ ruling, as it conflicts fundamentally with the spirit of EU law.

The EEB is Europe’s largest network of environmental organisations, with around 150 members in over 30 countries.

“What is lawful is not necessarily fair or just,” stresses Attracta Ui Bhroin, the EEB’s vice-president. “The ICS undermines the principle of equality before the law and grants foreign corporations a privileged status. It runs the risk of placing multinational corporations beyond the law in practical effect. This is bound to be harmful to EU citizens and the environment and makes defending EU law rights excessively difficult in practice”

While the new ICS contains some improvements compared with its predecessor, the Investor-State Dispute Settlement (ISDS) mechanism, it still acts outside domestic courts, affording special rights and privileges to large corporations. It allows corporations to extract up to billions from states when a new regulation is deemed to harm their expected profits. And it only operates in one direction, allowing corporates to sue states.

Putting citizens first

Resistance to ISDS and similar mechanisms, such as the ICS, has been mounting in recent years. Millions of citizens, large swathes of civil society and many policy-makers are opposed to separate arbitration mechanisms being built into trade deals.

More than half a million people have already signed a petition entitled ‘Stop ISDS. Rights for People, Rules for Corporations’. On Monday, activists handed the petition to First Vice-President of the European Commission, Frans Timmermans, who was quoted as saying, “You can count on me”. In addition to ending or adjusting all trade deals employing ISDS mechanisms, the petition demands that the EU and its member states support the negotiating of a legally binding UN treaty on transnational corporations and human rights.

Despite the Court of Justice’s ruling, the battle is far from over. Join the Stop ISDS. Rights for People, Rules for Corporations campaign, make your voice heard.