People Begin To Wake Up To Massive Dangers Of Investor-State Dispute Resolution
from the this-is-the-big-one dept
Techdirt has been writing about investor-state dispute resolution (ISDR) mechanisms in international trade treaties like TPP and TAFTA/TTIP for two main reasons. First, because of the scale involved: ISDR allows companies to sue entire countries for huge sums, alleging loss of future profits. And secondly, because few seem aware of this growing threat to the national sovereignty of many countries around the world. That finally seems to be changing, with a number of articles warning about the dangers of ISDR appearing recently.
For example, here's a report from the Transnational Institute looking at ISDR in the proposed free trade agreement between the EU and Canada (CETA):
This briefing highlights the public debate around fracking; the interests of Canadian oil and gas companies in shale gas reserves in Europe; and the impacts an investment protection clause in the proposed CETA could have on governments’ ability to regulate or ban fracking. It examines the case study of the company Lone Pine Resources Inc. versus Canada, which, using a similar clause is challenging a fracking moratorium and suing the Canadian government for compensation, and warns this could be the state of things to come in Europe. It recommends that the investor-state dispute settlement mechanism should not be included in CETA.
An article on the Huffington Post site considers ISDR in TPP:
That agreement aims to secure a binding agreement among signatory countries for "trade" rules that would trump national laws in a wide range of areas, including rights to protect the health of the public. It could require countries to rescind national regulations, even laws that protect public health, in the face of claims that they restrict trade.
An important post from Corporate Europe Observatory points out (as Techdirt did) that the leaked European Commission mandate for TAFTA/TTIP explicitly includes ISDR:
Leaked draft versions of the EU negotiating mandate for a far-reaching free trade agreement with the US -- to be approved at next week's trade minister meeting (14 June) -- reveal the European Commission's plans to enshrine more powers for corporations in the deal. The proposal follows a persistent campaign by industry lobby groups and law firms to empower large companies to challenge regulations both at home and abroad if they affect their profits. As a result, EU member states could soon find domestic laws to protect the public interest challenged in secretive, offshore tribunals where national laws have no weight and politicians no powers to intervene.
It goes on to give an excellent summary of how ISDR has already been used to sue governments around the world, and discusses the case of Chevron, and its single-minded efforts to get ISDR into TAFTA/TTIP:
Chevron is currently engaged in a controversial legal battle with Ecuador. The company initiated arbitration to avoid paying US$18 billion to clean up oil-drilling-related contamination in the Amazonian rainforest, as ordered by Ecuadorian courts. The case has been lambasted as "egregious misuse" of investment arbitration to evade justice. No wonder Chevron dedicated its complete contribution to the US government's TTIP consultation to investment protection, "one of our most important issues globally" as they put it.
Finally, a new 24-page report from The Democracy Center (available in English and Spanish), entitled "Unfair, Unsustainable, and Under the Radar," offers perhaps the most approachable introduction to this subject:
We look at how the international investment rules system is being used to punish El Salvador for blocking poisonous gold mining, against Germany for stopping nuclear power, and to attack public health regulations for the tobacco industry in Uruguay. And we flag the next target for the system: government ability to regulate 'fracking'.
Let's hope so: some of the world's most powerful corporations have realized that ISDR allows them to override national laws by invoking a newly-invented right to expected future profits, and are pushing hard to enshrine that "right" in all the main trade agreements -- TPP, CETA and now TAFTA/TTIP. If they succeed, it will undoubtedly become a standard part of every new FTA thereafter, and practically impossible to eradicate in the future.
Unfortunately, wide knowledge of this system and how it works doesn't really exist beyond a small collection of lawyers and advocates. Published in May 2013 this report explains what seems to many a highly technical issue for a non-technical audience, and in so doing aims to help put a much wider public spotlight on this corporate power grab while there is still time to fight it.
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Filed Under: investor state disputes, public awareness, tafta, tpp
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If so I have to ask: Isn't it enough that taxpayers already had to come up for their losses (aka to big to fail)?
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It is originally thought of as a way for companies to force governments to honour trade agreements since breaking them has been up to national judges and their potential national bias. ISDR is a sanction, if you may.
Unfortunately, any small hole in the formulation of a trade agreement will be abused to hell and given the sloppyness you get with only really a couple of weeks with real negotiations, spread out over years, we are talking about extremely volatile precedence. If it had only been a national agreement, it is far easier to change bad language and that is happening daily all over the world. However, ISDR is above the individual states laws, so the trade agreement will take precedence as the examples in the article describe. National governments will have to live with this precedence if the other country is even a bit vague about the specific point of contention.
All in all, this favours negotiation bullies like USA and China since they are the most experienced with legal poker and other countries do not want to sink their possibility of a FTA with a far larger market on account of some small expressions that seems minor in the total picture of the FTA.
The devil is in the detail is what many people have uttered. In earlier trade agreements details have been of limited importance since national courts will rule according to national laws and you have experts able to descipher that. With ISDR the details will trumph any overall achievements in the FTA. The possible abuse from industry may even amount to a rewrite of the idiom to "the devil wears Prada"...
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Plus: these clauses are a one way street. If a ruling goes against the big bullies they simply ignore it and threaten the winning party - as in the US dispute with Antigua.
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to acually answer your question: no, thye aren't asking for a guarantee of profits. they are asking for regulations that stand in their way to be set aside. ( this is dangerous, by the way: if companies could sue based on "it reduces our profits!!" then here is a list of regulations that would disappear in short order:
1. Minimum Wage- look at how many companies only pay the minimum for work that should really be paid more.
2. Health & Safety laws: it costs money to comply, (assessing health & safety risks, paying for such risks to be corrected, cost of equipment maintenance (the cost to maintain equipment to where it is safe is higher than to maintain it to where ti is functional))
3. discrimination laws: "if there are no laws against discriminating against people with disabilities, we don't need to pay for accommodations for their disabilities" " if we can employ only men, we don't need to pay for facilities for women" (I'm thinking bathrooms here, although there are other things you can eliminate (any sort of parental leave- dad can get the mother to look after the kids, after all.)
4. employment law- overtime laws "if we didn't have to pa overtime, we would make more money!!!"
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While I'm on the subject, try to imagine the impact of a "right to future profits" enshrined in law on anti-trust regulations.
That's the problem.
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Socialized losses.
It doesn't get any better than this, if you are uber-riche.
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Sci-Fi called it first - the world run by corporates.
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Our leaders are fucking brain damaged to allow this to move forward.
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How much worse would the world be today if companies that polluted lakes and oceans so badly they couldn't be drank from or swam in got that idea decade ago? They'd have never been cleaned up.
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Minion waking up to corporatism!
The minion doesn't have any solution except to wail: "practically impossible to eradicate in the future", but I say that any solution definitely requires recognizing that ALL corporations are EVIL, including your precious Google. And the people who own and control the corporations are EVIL too: it's inherent in power. So stop making excuses for The Rich, stop believing their lies that high taxes on them will hurt you, stop believing that anything corporate or anyone Rich or any politician has your interests in heart -- because those entities don't have hearts, neither literal nor figurative.
EAT THE RICH before they eat the rest of us.
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Re: Minion waking up to corporatism!
Obvious logic fail ... not too bright are ya?
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Re: Minion waking up to corporatism!
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What comes around goes around
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Maybe that is why they are waking up to it.
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