TPP: How the Investment Chapter Falls Short

[Oscar]

How the Investment Chapter of the Trans-Pacific Partnership Falls Short

[ http://www.iisd.org/commentary/how-inve ... alls-short ]

By Nathalie Bernasconi-Osterwalder November 6, 2015

EXCERPT:

The investment chapter closely resembles the template that the United States developed in 2012 as its negotiating text. For the most part, that text mirrors the 2004 U.S. model, which in turn is based on the text of the investment chapter of the 1992 North American Free Trade Agreement (NAFTA). In each case, the chapter has two main objectives: first, to protect foreign investors from political and other risks when they invest abroad; and, second, to accelerate investment liberalization and market access, through pre-establishment provisions (i.e. granting foreign investors the right to establish an investment on national treatment basis unless explicitly excluded). The TPP investment chapter, in line with the U.S. approach since the nineties, does nothing to promote sustainable investment, to combat corruption, or subject investors to responsible behaviour. It contains only an extremely weak and non-binding provision on Corporate Social Responsibility. Moreover, it includes an unaltered investor-state arbitration system, which U.S. investors have used extensively over the past years against developing (and developed) countries, and which suffers an ongoing legitimacy crisis.