Monday, September 23, 2013

Open season on suing Australia? Not yet. Robb's cautious

Foreign corporations wanting to sue Australian governments will have to cool their heels.

Incoming trade minister Andrew Robb says Australia’s negotiating position on the Trans Pacific Partnership Agreement remains in place despite an election commitment to overturn the blanket prohibition on so-called investor-state dispute settlement provisions.

The previous government declared point-blank Australia would never again sign an agreement with an ISDS provisions. One of the few trade agreements Australia has signed with such a clause has allowed a Hong Kong-based subsidiary of the tobacco giant Philip Morris to take Australia to an international tribunal over its plain packaging laws, despite having lost its case in the High Court.

It is believed the United States was close to accommodating Australia’s insistence by carving out an exemption for Australia while requiring each of the other ten signatories to be bound by the provisions.

Australia is the only country to have successfully concluded at trade deal with the US without such a clause, the US-Australia free trade agreement signed by the Howard government in 2004.

The Trans Pacific Partnership trade agreement will be the world's biggest - incorporating Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam, as well as Japan which joined in this year.

US companies are enthusiastic users of the provisions...

The United Nations Conference on Trade and Development says a record 58 ISDS cases were underway in 2012. In one a US resource company is suing the Canadian province of Quebec for imposing a moratorium on coal seam gas extraction while it examines claims of environmental damage.

Opening Australian governments to lawsuits over resource extraction, foreign land purchases, pharmaceutical benefits and health measures is a potential minefield for the income government.

Its policy is to “remain "open to utilising investor-state dispute settlement clauses as part of Australia’s negotiating position”.

In a written statement to Fairfax media Mr Robb said it would be “premature to discuss positions we may wish to pursue on this or any issue under discussion in the Trans Pacific Partnership agreement negotiations”.

“In opposition the Coalition stated that it would consider the inclusion of ISDS provisions in free trade agreements on a case-by-case basis. It would be wrong, however, to assume that this changes Australia’s current position on ISDS in the context of the Trans Pacific Partnership negotiations.”

Mr Robb will attend trade minister’s talks on the Trans Pacific Partnership on the sidelines of the APEC meeting in Bali on October 3. Prime Minister Abbott will discuss the partnership at a meeting of leaders including President Obama in Bali on October 7.

In The Sydney Morning Herald and The Age

Recommended Reading

. Abbott: Open For Business — And Multinational Lawsuits, Mike Seccombe, The Global Mail

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