TPP would let foreign investors bypass the Canadian public i

[Oscar]

TPP would let foreign investors bypass the Canadian public interest

[ http://www.theglobeandmail.com/report-o ... e27463985/ ]

SACHS AND JOHNSON LISA SACHS and LISE JOHNSON Contributed to The Globe and Mail

Published Wednesday, Nov. 25, 2015 5:00AM EST Last updated Wednesday, Nov. 25, 2015 5:00AM EST

Lisa Sachs is director and Lise Johnson is head of investment law and policy at the Columbia Center on Sustainable Investment.

EXCERPT:

Many of the concerns about how ISDS favours foreign investors over broader public interests are based on the increasing use of the “fair and equitable treatment” standard. Under the guise of improving the FET provision, the TPP drafters did exactly the opposite; the TPP now codifies the approach many arbitrators have been taking by allowing investors’ “expectations” to be a key factor in determining whether a government has breached its obligations. If an investor’s “expectations,” which may be based on general statements of government officials or promotional materials used to attract investors, are then not met, they can sue for damages. This is precisely how a tribunal held Canada liable under NAFTA in the Nova Scotia Bilcon decision this year. (See below . . )

Bilcon also illustrates how the non-discrimination standards in these treaties – originally aimed at preventing countries from discriminating against foreign investors on the basis of nationality – are now being used to challenge any government action that might impact an investor.

In Bilcon, the investors successfully claimed that Canada had violated the national treatment obligation because the government had denied an environmental permit for a controversial mining project while other projects were allowed to proceed. The fact that those other projects were in different locations, environments and communities was not persuasive to the tribunal. Investors are now using non-discrimination protections to challenge basic regulatory decisions and to prevent the strengthening of environmental and other standards over time. The new TPP language does not prevent that practice.

Importantly, Canada’s legal system has evolved to promote investment within Canada by protecting the rights of investors (and other stakeholders) from improper treatment by the government, giving them various rights of action in domestic courts and administrative processes. However, to balance those rights, the Canadian domestic legal system has also evolved to preserve the fundamental need for government to regulate investment to protect health, safety, security and other public interests.

ISDS allows foreign investors to bypass that very balance. By allowing them to selectively challenge basic contract, administrative or regulatory issues in a parallel process, ISDS undermines the agencies, courts and policy-makers that shape Canadian domestic law. Indeed, a forthcoming analysis shows that less than 20 per cent of the 34 claims filed against Canada under NAFTA would have any case for damages in domestic courts, and only half of those would have had an arguable case for the equivalent damages.

Many of us were hoping for a 21st-century agreement, enshrining our shared goals for global development while buttressing the policies, legal frameworks, democratic processes, transparent national courts and administrative systems of member countries. Alas, the TPP’s investment chapter has left a gaping hole, leaving member states – and their citizens – at the brink.



SEE ALSO:

Eyes wide shut on ISDS. By Lisa Sachs and Lise Johnson - April 22, 2015 - The Congress Blog. The Hill’s Forum for Lawmakers and Policy Professionals.
[ http://thehill.com/blogs/congress-blog/ ... ut-on-isds ]

Digby Neck Quarry Bilcon Case, Tribunal Decision and Dissent – May 11, 2015 - By Janet M Eaton, PhD
[ http://www.sierraclub.ca/en/DigbyNeck ]

WATCH: Chrystia Freeland on TPP: 'We are a trading nation' ( Globe and Mail Update )
[ http://www.theglobeandmail.com/report-o ... e27316423/ ]