Statement from Trade Justice Pilipinas
13 December 2022
Trade Justice Pilipinas welcomes the proposal put forward by the European Commission for the reform of EU’s regulation on Generalized Scheme of Preferences (GSP). In light of the failure by the European Council to come to an agreement on the review of the GSP regulation, we strongly urge the Council to resolve pending issues, consider the recommendations from CSOs and other stakeholders, and arrive at a common position as a matter of urgency.
We see the process of reform as an opportunity to highlight the issues and concerns over the implementation of GSP+ in the Philippines, with the view of addressing the weaknesses of the program as an instrument for ensuring protection of human rights and labor rights.
Two key aspects of the Commission’s reform proposal that we want to underscore are : 1. making the withdrawal of preferences process more responsive in urgent cases; and 2. enhancing the monitoring and implementation of GSP+ commitments, for instance through increased transparency and participation of relevant stakeholders, including through the recently created Single Entry Point (SEP) mechanism for noncompliance related complaints.
Our experience in the implementation of GSP+ in the Philippines show that despite the consistent efforts by civil society organizations including Trade Justice Pilipinas to raise concerns through the submission of formal complaints and presentation of cases of human rights violations directly to EU monitors, and repeated calls to the EU from Philippine and European CSOs, as well as the European Parliament to initiate temporary withdrawal procedures, the program was not able to respond to the urgent situation and thereby failed to prevent the deterioration of the human rights situation in the Philippines.
Making the withdrawal process more responsive is a central issue in this reform process. We support stronger and clearer guidelines on the following key areas:
- Civic engagement: Enhancing the participation of civil society, particularly opening up the process of meaningful consultations with communities, trade unions and social movements throughout the entire process from application, monitoring, and withdrawal if necessary.
- Expand list of compliance with international conventions: Extending positive and negative conditionality, amending the list of GSP relevant conventions, and introducing changes to the preferences withdrawal process to include environmental and good governance conventions. Aside from the inclusion of these new conventions, we propose the inclusion of references to UN Declarations on the Rights of Indigenous People’s (UNDRIP), and Peasants (UNDROP), as well as the recently passed UN Resolution on the Right to a Healthy Environment (A/76/L.75).
- Quick response mechanism– should include provisions on how a country can be penalized in an escalating manner: warning, temporary suspension of a company, permanent suspension of a company, temporary/permanent suspension of an industry/sector or partial/full suspension of all benefits, etc.
- Necessity of carefully assessing the socio-economic impact of withdrawal of preferences on the sectors of production affected to avoid hurting the most vulnerable members of the population. We support the conduct of socio-economic impact of withdrawal in initiating the withdrawal process, we recommend that the results of the impact assessment be communicated immediately to the government for immediate action. The assessment report should also constitute a fair warning to the government of the consequences of inaction.
- Complaint mechanism: Ensuring greater transparency in the monitoring and implementation of GSP commitments is [important] essential . We support the proposal for a new complaints mechanism, the Single Entry Point (SEP) as part of the increased efforts to strengthen the enforcement and implementation of trade commitments. We stress the importance of integrating this new system of complaints within the framework of the GSP Regulation, in particular with respect to the withdrawal procedure.
- Transparency on GSP+ beneficiary companies: Efforts on increasing transparency however should extend to transparency on the list of companies which are utilizing GSP. Such a list should be accessible to the public. Companies should also be compelled to report on traceability of their products as part of and consistent with due diligence standards.
We reiterate the following comments on GSP+ implementation in the Philippines in the hope that these issues will be addressed in the reform process:
- The first cycle of GSP+ failed to induce the Philippine government to earnestly enforce all the conventions, especially as regards to the number of killings and the ILO Core Labour Standards;
- A glaring institutional problem is the fact that GSP+ monitoring mission members are mostly not sensitized on the most fundamental HR matters, including the right to life and basic labor rights. Most are commerce -oriented people who appear to be ill-equipped or simply lack empathy to appreciate fundamental civil and political rights or to understand labor issues; We therefore recommend the inclusion of a human rights expert in the EU monitoring mission team to adequately assess the human rights situation
- Unlike in the US, the EU GSP+ lacked a clear complaint mechanism. It was only in recent years that the office of the Chief Compliance Officer was established.
- The lack of transparency on traceability of products and services that benefit from the EU GSP+ and a lack of capacity to in fact conduct traceability measures are major hindrances to the conduct of due diligence. In one online forum, both the DTI and the EU trade denied having data on the companies that benefit from the GSP+. And even if indeed data is available, there are no rules that would compel them to disclose the information.
- We support the creation of an effective mechanism where all companies benefiting from the GSP+, including the EU-based TNCs linked to them, could be held accountable for rights violations.
- Finally, negotiations for a new round of GSP+ for the country should be done with the full participation of unions, civil society and social movements.
Trade Justice Pilipinas