Also published in: Reader Supported News/Writing for Godot
Several separate and seemingly different forms of public protests and debates are “running” these days. One of them is an international call from Avaaz to sign a petition for a just rule of arbitration on the known in Spanish as Caso Philip Morris Contra Uruguay, which started about five years ago. In this case, the big tobacco company sues Uruguay for having legislated anti-smoking laws.
As it is the practice and after the July 2013 decision of the tribunal that it has jurisdiction to examine the case, the “complaint” of Philip Morris will be dealt and settled by the International Centre for Settlement of Investment Disputes (ICSID) a member of World Bank Group.
The company claims a compensation of $25 million for the anti-smoking campaign of Uruguay with photos on the cigarette packages. More that one million people have signed the petition until today.
In this case, the country has to defend its attempt to safeguard public health by passing anti-smoking laws and applying practices used all over the world.
Another wave of protests is taking place this week, 20-24 April with marches and events in Europe, Canada, USA and elsewhere. More than 20,000 participated in the recent marches and about 1.8 million have signed the internet declaration “STOP TTIP and CETA”.
Protests are against the Transatlantic Trade and Investment Partnership (TTIP) between EU and USA, the Canada-EU Trade Agreement (CETA), and the Trade in Services Agreement (TISA) a trade agreement currently being negotiated by 24 members of the World Trade Organisation (WTO), including the EU, three infamous pending agreements.
All of the agreements aim to “liberalise trade” either of goods or of services. The talks for TTIP have started (formally) in 2013 and remained secret even for the members of the European Parliament. Only after leaks of information which demonstrated the dangers for several sectors, MEPs and the public demanded transparency.
The same secrecy applies to EU-Canada negotiations. All of their terms are promoted as beneficial but Ulrike Hermann in “Free Trade Project of the Powerful” notes in the conclusion about TTIP: “The Canadian lawyer Howard Mann, who has dealt with investor protection agreements for more than 15 years”, assessed that, “this agreement [CETA] was the most ‘investor-friendly’ contract the Canadian government had ever negotiated”.
TTIP is a high target for USA and both the government and the lobbies have demonstrated their deep interest in many.
The dominance of the multinational companies, the privatization of public and social services and their fall to corporate giants are inevitable components of the agreement while the demonstrated benefits (for the people of both parts) are strongly challenged.
Anything but transparent negotiations and terms
Since 2013, a number of EU laws have changed, fragmentary though methodically, in an attempt to ensure “conformity” to the terms and conditions of TTIP which according to studies and publications threaten (in both sides): Democracy itself, Food Safety, Jobs, Environment, Public Services and Personal Privacy. TTIP also includes provision for Investor-State Dispute Settlement (ISDS), which is the tribunal mechanism involved in the Uruguay Case.
USA has insisted on including the clause in the agreement but according to information of January, the EU won’t decide whether to include it in the TTIP until the “final phase of the negotiations” with the US.
A major contribution to the public alert both in EU and USA about the agreements have offered the releases by the Wikileaks of a series of classified documents revealing terms and chapters of the other (also disputed) agreement, the TPP.
This “regional regulatory and investment treaty” which is top priority for Barack Obama, involves USA and 11 more countries, all of which control the 40% of the world’s economy -i.e. Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam.
The talks started in 2005 and have long passed their initial time-limit of 2012, as a wave of movements, activists and professional groups have questioned the clauses -especially after the documents publications by Wilileaks-, but also because of the discrepancies of interests between the countries.
The involving parts (the US overarching) claim that the results would be in favour of their countries and for the middle classes in particular, as President Obama stressed facing the criticism even from democrats, about the fast-track procedures on TPP.
Elizabeth Warren, the democratic senator -who is encouraged and supported by Media to run for the nomination for president- has initiated the internet campaign “No vote (by the Congress) on fast-tracking trade until the TPP agreement is public”. She also denounces the secrecy which has kept people out of “locked doors” about the information for TPP.
It is obvious that secrecy is a common factor of all negotiations on the so-called “free trade” agreements and the debate procedures that European Commission opened, function more than a propaganda channel rather than a voice of people.
After keeping the public in ignorance and mediocrity, the long time negotiations from their part, serve the gradual strategy, both strategies of manipulating the population according to Noam Chomsky.
It is also a common knowledge that corporate rules in USA; USA seeks the final signs of TTIP and TPP; the corporate seeks the agreements which means that their profits from them are evident.
Furthermore, corporate profits and interests are by definition and proven, against people’s benefits.
ISDS: Corporate Vs Countries
So, apart from terms concerning foods, environment or public services, which is the extra danger deriving from the ISDS term?
When a company invests and operates inside a country, it must comply with state laws. In case of changes of laws, citizens as well as companies have to conform. That is the norm but not under signed agreements which include ISDS term.
Under ISDS, if the investors, usually trans-national corporations, find that the new legislation affects their interests they have the right to demand compensations. “They are able to bring claims for damages against the host country even if they have no contract with its government”, as described by John Hilary, in “TTIP: Charter for Deregulation, an Attack on Jobs, an End to Democracy”.
Any dispute is resolved by the arbitration tribunals.
No matter what the beneficial act for the country and its people is, the supportive system of arbitration, almost by default decides in favour of the investor a practice that lead them to lose any credibility, according to an older (no longer available) Public Statement On The International Investment Regime, supported by academics with expertise on investment law, arbitration, and regulation.
A few examples out of 500 known cases against 95 countries follow:
- The Swedish energy company Vattenfall is suing the German government for € 3.7 billion over the country’s decision to phase out nuclear power […] Vattenfall has already been successful in a previous challenge to the city of Hamburg’s environment regulations […]
- …Under NAFTA rules, Canada was forced to revoke its ban on the fuel additive MMT under a challenge from US Company Ethyl. In a later case over water and timber rights, Canada had to pay out $122 million to the Canadian paper company AbitibiBowater. It is worth noticing here that some domestic companies “reinvent themselves as ‘foreign’ investors in order to take advantage of ISDS privileges and sue their government” according to Gus Van Harten’s, Investment Treaty Arbitration and Public Law, as cited by Hilary.
- US tobacco giant Philip Morris, apart from Uruguay, is also suing the Australian government for billions of dollars over its public health policy that all cigarettes must now be sold in plain packaging.
- Until 2011, 27 claims were pending against Argentina at the ICSID, accounting for more than 1/5th of that institution’s pending case-load. All but 1 of these 27 cases involve claims relating, at least in part, to Argentina’s response to its earlier financial crisis. In short, Argentina was sued to pay hundreds of millions of dollars for the measures it took against its financial crisis.
- Another South American country, Ecuador, has been ordered to pay to Occidental Petroleum $ 1.77 billion in damages for terminating the contract when the company broke the law (ICSID’s the largest award in history). On the other hand, a separate tribunal dismissed the claim for $19 billion in damages by Ecuador against Chevron for the contamination of the Amazonian rainforest, although there is evidence of the pollution which cost lives.
It becomes clear that arbitration tribunals are a kind of defenders and guardians of the interests of investors.
Together with enforced legislation about GMOs and other food processes applied by big companies in USA, fossil fuels and energy, privatizations -especially of health services- or personal privacy attacks by the copyright, patents and trademarks clauses, all under the agreements, the arbitration provision has more than one level of risks.
The TPP targets to completely uniform legislations of trade and services in countries around the Pacific, many of which are near China while TTIP, CETA and TISA involve European countries, all of which are near Russia.
Within the EU, where the countries of the south suffer the consequences of economic destabilization caused largely by the very core of the Euro zone, it could be a matter of (short) time to become colonies of big corporations and multinationals.
Or, as Noam Chomsky put it: “Every Word in the Phrase ‘Free Trade Agreement’ Is False”.
The Trans-Pacific Partnership and the Death of the Republic – The Web of Debt Blog
Updated April 27 2015