AN ISDS BY ANY OTHER NAME…

0
1077

By Luke Ming Flanagan

This is a long post but please bear with me, this has a huge bearing on your future.

Yesterday, as an integral part of the ongoing Transatlantic Trade & Investment Partnership (TTIP), it was the Investment-State Dispute Resolution process – ISDS. Today, courtesy of the genius that is the European Commission and specifically, Trade Commissioner Cecilia Malmström, we have the Resolution of Investment Disputes and Investment Court System, what we can shorten to RIDICulouS.

What will follow now is the mainstream media blitz, an expensive extensive very polished and professional PR campaign orchestrated from the Berlaymont in Brussels, European Commission HQ, extolling the virtues of this new system, how the concerns of the two million-plus citizens who signed the Citizens’ Initiative have been addressed and everything can now plough full steam ahead with the TTIP negotiations.

Against all that noise, you will have individual posts such as this, you’ll have the efforts by those organisations whose interests are the peoples’ interests, trying to make ourselves heard.

A FEW FUNDAMENTALS

Under the ISDS:
• The ‘settlement’ procedure could not be used by local companies, was for multinational corporations/investors;
• Those multinational corporations/investors could by-pass local and national courts, could even by-pass the Supreme Court(USA) and European Court of Justice (EU);
• Is staffed by arbiters/judges with a vested interest.

Under Malmström’s new proposal (RIDICulouS):
• The ‘settlement’ procedure cannot be used by local companies, is for multinational corporations/investors;
• Those multinational corporations/investors can by-pass local and national courts, can even by-pass the Supreme Court(USA) and European Court of Justice (EU);
• Is staffed by arbiters/judges with a vested interest (swapping arbitrators under ISDS for judges who will be paid a percentage of the final settlement, most likely leading to inflated damages being awarded to investors).

To paraphrase a well-known expression, if it looks like a duck, if it waddles like a duck, if it quacks like a duck, it probably needs a bit more time in the oven. In fact in this particular instance, what this whole treaty needs is a bit of time in the fire.

WHAT NON-GOVERNMENTAL ORGANISATIONS (NGOs) SAY

Natacha Cingotti, trade campaigner at Friends of the Earth Europe:
“The European Commission’s proposal for an ‘International Court System’ is tarred with the same old corporate-friendly brush. Despite a new name and some reforms on the functioning of the system, it reaffirms the granting of VIP rights for corporate investors without giving them any obligations that would protect citizens and the environment.

“The inclusion of investor-state arbitration – albeit under a different name – in an EU-US agreement is not necessary. It would expand its scope to an unprecedented level to all trade between the EU and the US, while now less than 10% is covered by ISDS. As long as companies can sue governments if they act in the public interest, the ability of governments to regulate is undermined. It should be resisted at all costs.”

Transport & Environment (T&E – sustainable transport group):
“The EU’s Investment Court System is a mere rebranding exercise of Investor-State Dispute Settlement (ISDS) in the EU-US trade deal. T&E thinks that this cosmetic exercise will resolve none of the fundamental concerns about granting special privileges for foreign investors, undermining national laws and bypassing domestic courts.

While going beyond previous attempts at reform, the Investment Court System will not be independent – swapping arbitrators under ISDS for judges who will be paid a percentage of the final settlement, most likely leading to inflated damages being awarded to investors.”

CONTRADICTORY COMMISSION
In her press conference announcing the ‘new’ court, on the various claims about legality and jurisdiction surrounding the TTIP negotiations Commissioner Malmström claimed that it isn’t possible to consult the European Court of Justice on the before an agreement enters into force.

According to EU Trade & Environment Lawyer Laurens Ankersmit, however, this is simply not true. “Article 218 (11) of the TFEU states: A Member State, the European Parliament, the Council or the Commission may obtain the opinion of the Court of Justice as to whether an agreement envisaged is compatible with the Treaties. Where the opinion of the Court is adverse, the agreement envisaged may not enter into force unless it is amended or the Treaties are revised.”

Laurens goes on to point out that this facility HAS already been used – no fewer than 22 times, and most of those BY the European Commission itself! In fact earlier this year, when Malmström was already part of the College, the Commission formally registered a request for an Opinion on the EU-Singapore FTA (Free Trade Agreement).

NO PROVEN USE OR NEED FOR ISDS
The fact is, even Commissioner Malmström herself admits that there is no proven link between ISDS courts and increased investment. In reply to a Written Question submitted by a GUE/NGL colleague of mine here, German Die Linke MEP Fabio De Masi, this was Ms Malmström’s reply, on behalf of the Commission:
The Commission is aware that most studies do not establish a direct and exclusive causal link between international investment agreements (IIAs) and foreign direct investment (FDI).

So, be ready for the onslaught, be ready with your own answers, be ready especially with the one most fundamental point of all – in the two supposedly most advanced legal systems on the planet, the EU and the USA, jurisdictions in which the vast majority of investors already operate under existing law (like the rest of us, by the way), what kind of investor WON’T invest unless an ISDS clause is included in TTIP?

Then ask yourself this: in whose interests is Commissioner Malmström acting here, who stands to benefit from these courts, you, or the all-powerful multinationals?

FINAL THOUGHT
More and more people are becoming aware of TTIP, but even further along the negotiation trail is CETA (Comprehensive Economic and Trade Agreement), an EU-Canada trade deal. Despite the fact that even the European Commission itself accepts that the current form of ISDS is deeply flawed, they plan on finalising a CETA deal that includes the old ISDS clause. Think about that.

For those who haven’t yet signed, here is a link to the Stop TTIP Citizens’ Initiative petition:
www.stop-ttip.org