The European Union-Mercosur free trade agreement faces growing opposition from European national governments, EU parliamentarians, and non-profit organizations, in addition to Latin American entities, putting its ratification at risk.
The Energy Charter Treaty, which dates back to the 1990s, severely restricts Europe’s ability to change regulations in the energy sector, with many EU member states facing court actions worth billions of euros, write a group of MEPs.
The deal provides loopholes for oil, gas, and mining companies to operate across borders, and paves the way for US companies to export even more fracked natural gas across the border into Mexico.
Most countries have implicitly created a carbon subsidy in trade policy. Using trade policy negotiations to decrease this environmental bias of trade policy could help address climate change.
On the basis of the Energy Charter Treaty, companies are suing countries for damages when the latter decide to phase out or limit the use of fossil fuels.