Corporate Sovereignty Used To Bully Ukraine, Colombia And Italy For Protecting Public Health And The Environment

from the profits-before-people dept

Corporate sovereignty provisions in investment treaties have become much better known than they were when Techdirt first wrote about them in 2012. Despite that growing awareness, and widespread outrage at the idea that corporations can request secret supra-national tribunals to make awards of hundreds of millions or even billions of dollars paid from public funds, companies continue to use the system to bully governments into changing their policies. For example, here is the US pharmaceutical company Gilead successfully deploying corporate sovereignty against the Ukrainian government, as originally reported by Investment Arbitration Reporter:

The dispute with Gilead, which Ukraine's Ministry of Justice had characterized as an $800 million dispute, relates to the drug sofosbuvir (sold by Gilead as Sovaldi). Sovaldi, a highly effective treatment for chronic hepatitis C, has been available in Ukraine -- a country reportedly home to over 2 million people infected with hepatitis C -- since 2015, but the company has lately been locked in a struggle over the ability of generic companies to market cheaper versions of the drug in Ukraine.

According to details of the settlement released by Ukraine's Ministries of Justice and Health, the settlement sees Gilead refrain from pursuing its damages claims against the country, and will see the company offer Sovaldi (and a combination therapy called Harvoni) at a reduced price.

Also, following the settlement, a generic competitor of Gilead has seen its own competing drug de-registered by authorities.

By de-registering the generic competitor to Gilead, the Ukrainian government is allowing the US company's to maintain its monopoly on the drug. In Colombia, the Swiss drug company Novartis also used the threat of a corporate sovereignty lawsuit, in this case to put pressure on the government there to stop it from issuing a compulsory license for a key anti-cancer drug, which would allow low-cost generics to be produced:

Leaked letters (PDF) to the Ministry of Trade and Industry show how Novartis threatened to resort to international investment arbitration for an alleged violation of the Swiss-Colombian bilateral investment treaty (BIT), which was signed by both countries in 2006. This undemocratic procedural mechanism, better known as Investor-State dispute settlement (ISDS), forms part of many trade agreements and allows an investor from one country to bring a case directly against the country in which they have invested before a private international arbitration tribunal, without going through local courts first. This threat has undoubtedly influenced the decision of the Colombian health authorities to stop short of pursuing a compulsory license, focusing only on a price reduction.

It's not just drug companies that try to use ISDS litigation to force governments to reverse their policies. Here's an oil and gas exploration company that is unhappy with a decision by the Italian parliament to ban new exploration and production activity within 12 nautical miles of the coast because of concerns for the environment and the high risk of earthquakes:

Rockhopper Exploration is fighting for compensation from Italy after it banned offshore drilling, leaving the company unable to develop one of its oil and gas fields.

The Aim-listed explorer said that it had begun international arbitration against the country for "very significant monetary damages" over the loss of future profits from its Ombrina Mare field.

Since Rockhopper is an oil exploration company, it must have carried out detailed studies on the geology of the field before deciding to drill for oil and gas. Either its geologists were negligent in not spotting that there was a risk of earthquakes which made the area unsuitable for exploitation, or the company knew about the dangers, and decided to continue with its plans anyway. In any case, it's ridiculous that Rockhopper thinks the Italian government owes it money for "lost future profits" that clearly never existed anywhere other than in the company's fantasies.

This is a general problem with corporate sovereignty claims: they often invoke some mythical "future profits" as if those were indisputable and guaranteed. But business is based on rewarding calculated risk-taking, and that includes the risk that hoped-for profits never materialize. ISDS is an attempt to remove the risk of investment from companies, and place it squarely on the public's shoulders, without any quid pro quo.

Follow me @glynmoody on Twitter or identi.ca, and +glynmoody on Google+

Filed Under: colombia, corporate sovereignty, environment, health, isds, italy, ukraine

DailyDirt: Changing Our Environment

from the urls-we-dig-up dept

One of the properties of life itself is that it changes its environment. All life does it, not just us humans. But we might be the only animals that might care about our legacy on the world. We haven't completely figured out what mark we've left on the Earth (or if it's permanent), but we've definitely changed some things, for better or worse.

• Have we created a new era? The anthropocene isn't exactly a well-defined era just yet, but some folks are narrowing down the characteristics of a new geological epoch. We've made lots of concrete, plastic, atmospheric carbon dioxide and radioactive isotopes, but will anyone be around to care about these technofossils in a few thousand years? [url]
• Maybe we'll figure out how to clean up some of our mess in the ocean -- and start to get rid of all the plastic junk in the Great Pacific Garbage Patch. There's still plenty of pollution in lakes and other bodies of water, so we won't be able to get rid of all the evidence of our hydrocarbon-based economy. [url]
• We could also just learn to embrace the new world we've created -- and get accustomed to the vast Alaskan farmlands. Farming in the subarctic is getting a bit easier now that the ground isn't a frozen tundra all year long anymore. [url]

If you've been thinking about learning how to code, take a look at our Daily Deals for a collection of online courses to help you program and/or master some professional skills.

Filed Under: anthropocene, earth, environment, geological epoch, great pacific garbage patch, plastics, pollution, subarctic farming, technofossil

Leaked TAFTA/TTIP Chapter Shows EU Breaking Its Promises On The Environment

from the toxic-trade-deal dept

As far as trade agreements are concerned, the recent focus here on Techdirt and elsewhere has been on TPP as it finally achieved some kind of agreement -- what kind, we still don't know, despite promises that the text would be released as soon as it was finished. But during this time, TPP's sibling, TAFTA/TTIP, has been grinding away slowly in the background. It's already well behind schedule -- there were rather ridiculous initial plans to get it finished by the end of last year -- and there's now evidence of growing panic among the negotiators that they won't even get it finished by the end of President Obama's second term, which would pose huge problems in terms of ratification.

One sign of that panic is that the original ambitions to include just about everything are being jettisoned, as it becomes clear that in some sectors -- cosmetics, for example -- the US and EU regulatory approaches are just too different to reconcile. Another indicator is an important leaked document obtained by the Guardian last week. It's the latest (29 September) draft proposal for the chapter on sustainable development. What emerges from every page of the document, embedded below, is that the European Commission is now so desperate for a deal -- any deal -- that it has gone back on just about every promise it made (pdf) to protect the environment and ensure that TTIP promoted sustainable development. Three environmental groups -- the Sierra Club, Friends of the Earth Europe and PowerShift -- have taken advantage of this leak to offer an analysis of the European Commission's real intent in the environmental field. They see four key problems:

The leaked text fails to provide any adequate defense for environment-related policies likely to be undermined by TTIP. For example, nothing in the text would prevent foreign corporations from launching challenges against climate or other environmental policies adopted on either side of the Atlantic in unaccountable trade tribunals.

The environmental provisions are vaguely worded, creating loopholes that would allow governments to continue environmentally harmful practices. The chapter lacks any obligation to ratify multilateral agreements that would bolster environmental protection and includes a set of vague goals with respect to biological diversity, illegal wildlife trade, and chemicals.

The leaked text includes several provisions that the European Commission may claim as "safeguards," such as a recognition of the "right of each Party determine its sustainable development policies and priorities" but none would effectively shield environmental policies from being challenged by rules in TTIP.

There is no enforcement mechanism for any of the provisions mentioned in the text. Even if one were included, it would still be weaker than the enforcement mechanism provided for foreign investors either through the investor-state dispute settlement mechanism or the renamed investment court system.

The environmental groups have produced a detailed five-page document (pdf) that goes through each of these points in turn, and it's well-worth reading. But it's striking that the central problem is Techdirt's old friend, corporate sovereignty, aka investor-state dispute settlement (ISDS):

Nothing in the text would prevent foreign corporations, on either side of the Atlantic, from challenging climate or other environmental policies via an "investor-state dispute settlement" (ISDS) mechanism or via the European Commission's proposed "Investment Court System." Both enable foreign investors to challenge environmental policies before a tribunal that would sit outside any domestic legal system and be able to order governments to compensate companies for the alleged costs of an environmental policy. While the Commission claims that its new investment "reforms" would protect the right to regulate, States could still be "sued" if foreign investors considered that a policy change violated the broad, special rights that the Commission’s "reformed" investment proposal would give them.

In other words, at the heart of the European Commission's philosophy is the implicit acceptance that investors' rights take precedence over the public's rights -- in this case, those concerning the environment. Everything in the leaked sustainable chapter is couched in terms of aspirations -- the US and EU are encouraged to do the right thing as far as sustainable development is concerned, but there are few, if any, obligations or enforcement mechanisms. When it comes to protecting investors, on the other hand, everything is compulsory, backed up by supranational tribunals that can impose arbitrarily large fines, payable by the public. Although it is true that governments are given the "right" to legislate as they wish when it comes to the environment, investors are given the "right" to sue those governments black and blue if they attempt to do so.

Nor is this mere theory. Research carried out last year by Friends of the Earth Europe shows that of the 127 known ISDS cases that have been brought against 20 EU member states since 1994, fully 60% concern environment-related legislation. In other words, if the European Commission's proposals or something like them became part of the final TTIP agreement, it would almost guarantee a torrent of litigation aimed at blocking or neutering environmental legislation on both sides of the Atlantic.

This is an important leak because it reveals, once more, that a central problem of TAFTA/TTIP is the corporate sovereignty that is inherent in ISDS -- the fact that companies are allowed to place the preservation of their future profits above any other consideration, such as the environment, health and safety or social goals. The EU's sustainability chapter -- an area that is widely recognized as increasingly important in a world where lack of sustainability poses all kinds of problems -- is framed entirely in outdated, 20th-century terms: boosting trade and maximizing profits are the only metrics that matter. The European Commission's willing embrace of that approach confirms both its contempt for the 500 million Europeans it supposedly serves, and the fact that, far from protecting the environment, TAFTA/TTIP is shaping up to be a very toxic trade deal.

Follow me @glynmoody on Twitter or identi.ca, and +glynmoody on Google+

Filed Under: corporate sovereignty, environment, eu, isds, promises, tafta, ttip

EPA Sides With GM In Telling Copyright Office That Copyright Should Stop You From Modifying Your Car Software

from the wrong-tool,-guys dept

As we noted earlier this year, as the Copyright Office and the Librarian of Congress consider the requested "exemptions" from Section 1201 of the DMCA, General Motors has come out strongly against allowing you to modify the software in the car that you (thought you) bought from the company. If you're new to this fight, Section 1201 of the DMCA is the "anti-circumvention" clause that says that it's copyright infringement if you "circumvent" any "technological protection method" (TPM) -- even if that circumvention has absolutely nothing to do with copyright infringement. Yes, this is insane. It's so insane that Congress even realized it would lead to ridiculous situations. But, rather than fixing the damn law, Congress instead decided to duct tape on an even more ridiculous "solution." That is that every three years (the so-called "triennial review"), people could beg and plead with the Copyright Office and the Librarian of Congress to issue special "exemptions" for classes of work where Section 1201 wouldn't apply. Yes, that's right, you have a law, but Congress knew the law made no sense in some cases, and so it just gave the Librarian of Congress (the guy who currently can't keep his website online) the power to anoint certain classes of technology immune from the law.

Anyway, as mentioned, General Motors and others car makers (and also tractor maker John Deere) have been lobbying against the change, arguing all sorts of damage might occur should people be able to hack their own cars legally. And, to be fair, there is a legitimate point that someone messing with their own car's software could potentially do some damage. But, there are some pretty easy responses to that. First off, that's not copyright's job. If you want to ban tinkering with the software in cars, pass a damn law that is specifically about tinkering with software in cars, so that there can be a real public debate about it. Second, lots of perfectly legal tinkering with the mechanical parts of automobiles can also lead to dangers on the road, but we don't ban it because people are allowed to tinker with things they own.

Either way, the Copyright Office reached out to the EPA about this issue, and in a just published letter (even though it was sent months ago), it's revealed that the EPA is asking for the exemption to be denied because it's "concerned" that these exemptions would "slow or reverse gains made under the Clean Air Act." It also argues that allowing the right to modify your own software would "hinder its ability to enforce... tampering prohibition[s]" that are in existing law already:

EPA is also concerned that the exemptions would hinder its ability to enforce the tampering prohibition. Under section 203(a), the Agency has taken enforcement action against third-party vendors who sell or install equipment that can "bypass, defeat, or render inoperative" software designed to enable vehicles to comply with CFAA regulations. EPA can curb this practice more effectively if circumventing TPMs remains prohibited under the DMCA

First of all, this shows that there's already another law in place for dealing with people who are doing things that will impact the environment. Second, who cares if it makes the EPA's job easier, that's not the role of copyright. That the EPA would so casually argue that it's okay for it to be abusing copyright law, just because it makes the EPA's job easier is patently ridiculous.

Following that, the EPA then mocks the idea that anyone would have a legitimate reason to tinker with the software in their own cars:

The Agency also questions whether there is a real need for the exemptions. Car makers are already required to provide access for lawful diagnosis and repair. In EPA's view, whether or not they are designed for this purpose, the TPMs prevent unlawful tampering of important motor vehicle software.

Again, that's not the job of copyright, and supporting the abuse of copyright for this purpose is ridiculous. Furthermore, now that we're living in an age of connected cars, where we're already discovering that car software is a security nightmare it's actually more important than ever that people be able to tinker with the software in their cars, to probe for security weaknesses and to improve that software where possible. The EPA has every right to go after those who do so in a manner that violates environmental laws, but it shouldn't support abusing copyright law just because it makes the EPA's job easier. And, it shouldn't just assume that there are no legitimate reasons for wanting to modify the software in your car just because EPA staffers are too simple-minded to understand what those reasons might be.

Whatever you might think of the EPA and its mission, the idea that it would advocate abusing copyright laws is a disgrace.

Filed Under: 1201, anti-circumvention, copyright, copyright office, dmca, environment, epa, librarian of congress, triennial review
Companies: gm

Wyoming Makes Reporting Environmental Disasters Illegal

from the ag-gag-embiggened dept

Techdirt has written several times about so-called "ag-gag" laws, which have the strange effect of making it illegal for members of the public to expose animal abuse on farms. Slate has a fascinating report about how Wyoming is bringing in its own kind of ag-gag law that is so wide in its reach that it could make taking photos in Yellowstone illegal:

photos are a type of data, and the new law makes it a crime to gather data about the condition of the environment across most of the state if you plan to share that data with the state or federal government.

The specificity of that restriction sounds absurd. Why on earth would anyone want to prevent environmental data being gathered? Here's why:

The state wants to conceal the fact that many of its streams are contaminated by E. coli bacteria, strains of which can cause serious health problems, even death.

The reason the state is trying to do that is because the E. coli in question comes from cows, and cows have clout in Wyoming:

Acknowledging that fact could result in rules requiring ranchers who graze their cows on public lands to better manage their herds. The ranching community in Wyoming wields considerable political power and has no interest in such obligations, so the state is trying to stop the flow of information rather than forthrightly address the problem.

The law is framed broadly: it makes it a crime to "preserve information in any form" about "open land" if there is any intention to submit it to a federal or state agency. That means that if you discovered a major environmental disaster in Wyoming, no matter how life-threatening, you had better keep information about it to yourself. As the Slate post points out:

By enacting this law, the Wyoming legislature has expressed its disdain for the freedoms protected by the First Amendment and the environmental protections enshrined in federal statutes. Today, environmentally conscious citizens face a stark choice: They can abandon efforts to protect the lands they love or face potential criminal charges.

Now that's what I call an ag-gag law.

Follow me @glynmoody on Twitter or identi.ca, and +glynmoody on Google+

Filed Under: ag gag, animal rights, cows, environment, free expression, photographs, wyoming, yellowstone

If You Care About The Environment In Canada, You May Be Targeted As An 'Anti-Petroleum Extremist'

from the muzzling-dissent-again dept

As Techdirt has been warning for some time, one of the dangers with the flood of "anti-terrorist" laws and powers is that they are easily redirected against other groups for very different purposes. A story in the Globe and Mail provides another chilling reminder of how that works:

The RCMP [Royal Canadian Mounted Police] has labelled the "anti-petroleum" movement as a growing and violent threat to Canada's security, raising fears among environmentalists that they face increased surveillance, and possibly worse, under the Harper government's new terrorism legislation.

As the Globe and Mail article makes clear, environmentalists are now being considered as part of an "anti-petroleum" movement. That's not just some irrelevant rebranding: it means that new legislation supposedly targeting "terrorism" can be applied.

The legislation identifies "activity that undermines the security of Canada" as anything that interferes with the economic or financial stability of Canada or with the country's critical infrastructure, though it excludes lawful protest or dissent. And it allows the Canadian Security and Intelligence Service to take measures to reduce what it perceives to be threats to the security of Canada.

Clearly, that's an incredibly broad definition, and would apply to just about any environmental or social movement -- especially since even the most peaceful protests are often considered "illegal." That, in its turn would allow Canada's security agencies to collect information on these groups, and "disrupt" them. What's also troubling about the leaked RCMP "intelligence assessment" that forms the source for the Globe and Mail story is the very clear political position it seems to be taking on fossil fuels and climate change:

The report extolls the value of the oil and gas sector to the Canadian economy, and adds that many environmentalists "claim" that climate change is the most serious global environmental threat, and "claim" it is a direct consequence of human activity and is "reportedly" linked to the use of fossil fuels.

That sounds more like something that would come from the oil and gas industries' marketing departments, rather than from a country's impartial police force. However, as Techdirt has reported before, the current Canadian government has been muzzling other groups that dare to disagree with its policies, especially on climate change, for some time. Redefining environmentalists as anti-petroleum extremists is clearly part of the same repressive approach.

Follow me @glynmoody on Twitter or identi.ca, and +glynmoody on Google+

Filed Under: anti-petroleum extremist, canada, environment, environmentalists, extremism, law enforcement, national security, rcmp, royal canadian mounted police, surveillance

DailyDirt: It's The Little Things That Matter...

from the urls-we-dig-up dept

Adding a little bit of something can make a huge difference. For example, some carbon and a few other trace metals added to iron can make a steel stronger and stainless. Nanotechnology promises to improve a bunch of things with very small changes to the surfaces of common materials. But these small changes could also cause some big problems. Here are just a few links on some small ingredients that might not be so great for the environment.

• In case you hadn't heard, Minnesota has passed a law against antibacterial soaps containing triclosan. The law won't go into effect until 2017, so the big soap makers have some time to try to fight the ban or figure out how to sell regular old soap now that they've flooded the market with soaps that tell consumers that old soap formulas are more germy. [url]
• Illinois has banned microbeads in soaps and body washes. This law also won't go into effect for a few years, but the tiny plastic beads are already turning up in the Great Lakes and in various waterways. [url]
• If you don't like the idea of nano-sized particles of titanium dioxide in food, you should look at your dairy products a bit more closely. The FDA is looking into regulating nano-sized particles, but some commercial products may already contain them. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post via StumbleUpon.

Filed Under: antibacterial, environment, fda, microbeads, nanotechnology, soap, titanium dioxide, triclosan

DailyDirt: What Will Humanity's Legacy Be?

from the urls-we-dig-up dept

Humans have obviously had a significant impact on the Earth. We've killed off various species and built stuff that may long outlast our grandchildren (e.g., the pyramids, the Long Now clock, nuclear waste facilities, etc.). At some point, we might want to think about what we'll leave behind after we're gone ourselves. Here are just a few links on planning for the future for our world.

• A professor of water management looked at humanity's overall environmental footprint -- and concluded our behavior is unsustainable. It's not such a big surprise, but the report also points out that technology alone probably won't bring us back to sustainable levels if we don't alter our consumption habits. [url]
• Economically, though, maybe you shouldn't worry too much -- and just consume as much as you can when you're young and able to enjoy it. If you're not planning to live too long, it doesn't make much sense to save for the future or work long hours hoping that you'll be able to enjoy retirement someday. [url]
• Humanity's new, long-lasting techno-fossils might be plastiglomerates -- a new type of rock made up of plastics, volcanic sediment and various other kinds of beach debris. These plastic rocks might not last as long as other kinds of geological materials, but their traces could become a distinguishing feature of the Anthropocene era. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post via StumbleUpon.

Filed Under: anthropocene, environment, footprint, global climate change, impact, long now, plastic, plastiglomerates, rocks, sustainability

USTR Promises Congress TPP Will Have Strong Environmental Protections; Then Immediately Denies Saying That

from the but-of-course dept

Back in January, you may recall that Wikileaks helped leak out the TPP's environmental chapter. It showed fairly weak efforts to protect the environment, many of which appeared to be there more for show than anything else. While it did reveal that the US had been negotiating for greater environmental protections, it also revealed that it was somewhat alone in that position, leading many to believe that any final agreement is likely to be even weaker than what's currently in the chapter. In response to this, the USTR put out what appeared to be a fairly strong statement that it won't accept weak environmental protections in the TPP.

However, over at Huffington Post, Zach Carter notes that USTR Michael Froman isn't convincing anyone in Congress, because he's doing what he's always done best: talking out of both sides of his mouth, first promising strong environmental protections, then denying he ever said any such thing:

"Ambassador Froman was asked on I think it was four different areas, and each time he said it was absolutely non-negotiable from a U.S. standpoint," [Rep. Mark] Pocan told The Huffington Post. "So then at the end, I listed those four areas to make sure I had the U.S. position right. And he said again it was non-negotiable. And then right after that, Lloyd Doggett got up and said, 'So does that mean that if we give you fast track, you won't send us a deal that doesn't have that stuff in it?' And right off the bat, the answer was, 'I didn't say that.' And to me, non-negotiable is, you know, non-negotiable."

And, of course, one of those four key areas was strong environmental protections.

"Froman said we're not gonna sign it unless there's an enforceable environmental chapter," another attendee told HuffPost. "And Doggett says, 'What does that mean? … If we give you fast track, you're not gonna come back with a deal that doesn't have an enforceable environmental chapter?' Then Froman says very emphatically, 'I can't speak for the president. All I can tell you is we're working as hard as we can to get an enforceable chapter in there.'"

Except that, as USTR, it's kind of Froman's job to speak for the President on this issue.

But, even more to the point is that this highlights (yet again) how the USTR is flat out lying about fast track (also known as "trade promotion authority"). As we've pointed out, Fast Track gets Congress to abdicate its (Constitutionally-granted) powers to regulate international commerce, by denying it the ability to actually explore what's in these agreements. Instead, fast track more or less gives the USTR a form of "pre-approval" to come back with a final agreement, such that Congress can only give the total thing a yes or no vote.

The USTR has attempted, ridiculously, to mischaracterize fast track authority as the opposite, pretending that it allows Congress to set the parameters for what the USTR must negotiate. Yet, here it's pretty damn obvious that's not the case at all. These members of Congress are asking about environmental protections, and are being told its "non-negotiable" -- suggesting that the USTR understands Congress' intent here. Yet, when pressed specifically on whether, if given fast track, he is guaranteeing those proposals will be in the final TPP, Froman immediately pretends he said no such thing.

And while some may argue he can't promise that because he's only one of many parties involved in the negotiation, that very point highlights why fast track authority is totally inappropriate. Congress can't give up its sole authority in regulating international trade, based on a weak promise from the administration that it will try its best to get them what they want.

Filed Under: environment, michael froman, tpp, ustr

US Free Trade Agreements Are Bad Not Just For The Economy, But For The Environment, Too

from the what-was-the-benefit-again? dept

A couple of months ago, we reported on some interesting research into the reality of US trade agreements, in contrast to the rosy pictures always painted when they are being sold to the public by politicians. In particular, it turned out that far from boosting US exports and creating more jobs, both the North American Free Trade Agreement (NAFTA) and KORUS, the free trade agreement with South Korea, actually did the opposite -- increasing the US trade deficit with those countries, and destroying hundreds of thousands of American jobs.

But of course bare economic statistics don't capture the full effect of free trade agreements. For example, there is also the environmental impact to consider. An interesting press release from the Sierra Club reports on a meeting held to consider that aspect. It turns out that things look as bad there as they do on the economic front:

"Nearly 20 years into NAFTA and the evidence is in," said Ilana Solomon, director of the Sierra Club’s Responsible Trade Program. "NAFTA led to an expansion of deforestation and unsustainable water use in order to support export-oriented agriculture. It gave massive rights to corporations to challenge environmental and climate safeguards in private trade tribunals. It expanded exports in dirty fossil fuels in a time when we should be moving beyond these outdated fuels and investing in clean energy. Governments must take a page out of the history books and stop negotiating trade pacts that gut protections for our air, water, land, workers, and communities."

That last comment is a clear reference to TPP, but applies equally to TAFTA/TTIP. Both of these are likely to include investor-state dispute settlement (ISDS) measures that allow companies to sue entire nations for alleged "expropriation" of future profits in the "private tribunals" referred to above. One of the ways that governments can be accused of doing that is by strengthening safeguards for the environment, since that often has the knock-on effect of increasing costs for businesses, and thus reducing their future profits. Companies then try to claim ISDS provisions in trade agreements give them the "right" to sue for compensation -- Techdirt recently wrote about a case involving the Canadian province of Quebec.

The problem with ISDS is not just the literally limitless awards that can be made against governments, which have to be paid out of public funds. The mere threat of such actions can have a chilling effect on the formulation of national policy. It's been happening in Canada for over a decade, thanks to the ISDS chapter in NAFTA, as a former government official in Ottawa explained:

"I've seen the letters from the New York and DC law firms coming up to the Canadian government on virtually every new environmental regulation and proposition in the last five years. They involved dry-cleaning chemicals, pharmaceuticals, pesticides, patent law. Virtually all of the new initiatives were targeted and most of them never saw the light of day."

What this means in practice is that ISDS clauses in major US trade agreements currently being negotiated are likely to have the same negative effects on the environment as NAFTA, but on a much greater scale. That's because they involve far larger trade blocs, and recourse to ISDS tribunals has increased greatly in recent years, adding to the credibility of threats to use them unless plans for more stringent environmental policies are dumped. So alongside the dubious economic claims being made for them, which are undermined by the failure of both NAFTA and KORUS to produce the predicted exports or jobs, we can now add the hidden environmental damage as yet another reason to call into question the alleged benefits of both TPP and TAFTA/TTIP.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

Filed Under: economics, economy, environment, korus, nafta, tafta, tpp, ttip