Health

The investor-to-state dispute settlement (ISDS) provisions proposed in trade agreements give pharmaceutical corporations the right to sue governments for compensation if domestic laws negatively affect future earnings on their intellectual property or investments, and even if these laws are in accordance with public interests. Better access to medicines or preventing unsafe or ineffective medicines from entering the market could prove problematic.

Major US, Canadian and French pharmaceutical companies have recently challenged pro-public health measures through ISDS disputes brought under ISDS provisions.

Chemical corporations have also used ISDS in numerous occasions to challenge national bans on hazardous substances.

Most well-known cases include:

• Ethyl (US) vs. Canada: following Canada’s ban on the toxic petrol additive MMT, the US producer sued for US$201 million in compensation. In 1998, Canada agreed in a settlement to pay US$13 million and withdrew the ban (NAFTA invoked).

• Philip Morris Asia (Hong Kong) vs. Australia: When Australia introduced plain packaging for all tobacco products in 2011, Philip Morris sued Australia before an arbitral tribunal. In its December 2015 decision, the tribunal dismissed the case, albeit on legal grounds only. Australia spent A$24 million in legal costs but Philip Morris only paid half, leaving the Australian taxpayers to pay the other half. As a consequence of this case, countries ranging from Namibia, Togo to New Zealand decided to wait to introduce their own plain packaging for tobacco products. (Australia-Hong Kong BIT invoked)

• Dow Chemical (US) vs. Canada: the chemical corporation initiated a dispute for losses it alleged were caused by a Quebec provincial ban on lawn pesticides containing the active ingredient 2,4-D, classified as a possible carcinogen and one of the ingredients in Agent Orange, the herbicide widely used during the Vietnam war. In a settlement in 2011, the ban was sustained but Quebec was required to state that “products containing 2,4-D do not pose an unacceptable risk to human health or the environment provided that the instructions on their label are followed.” (NAFTA invoked.)

(March 2020)

World Commerce Review | 11-Jun-2020
Arbitration cases due to COVID emergency measures would exacerbate the challenges that public budgets are already facing due to the need for stimulus measures and the difficulty in collecting government revenue.
The Hill | 10-Jun-2020
We call for a moratorium on investor-state arbitration cases and clarity of legal principles to ensure that governments have the policy space to protect their citizenry and combat the epidemic.
RTS | 9-Jun-2020
Une vague de plaintes de propriétaires et d’investisseurs étrangers menace de s’abattre sur les Etats, en raison de la fermeture de nombreux sites, commerces ou filiales, s’inquiètent des représentants des Nations unies.
El País | 7-Jun-2020
Estudios jurídicos están alentando a las corporaciones a recurrir a tribunales internacionales para que los Estados se hagan cargo de los efectos negativos causados por la pandemia, invocando la afectación de “derechos” empresariales.
El Salto | 5-Jun-2020
Varios estados, entre ellos el español, podrían recibir reclamaciones por daños y perjuicios de inversores extranjeros debido a las leyes de emergencia por covid-19.
In These Times | 2-Jun-2020
Wealthy corporations may use trade courts to keep public health measures from cutting into their profits.
IISD | 27-May-2020
Governments worldwide need the policy space now to issue economic support packages and protect their public health systems, without worrying that their budgets could face even more strain from an all-consuming wave of arbitration.
Lexology | 22-May-2020
The COVID-19 pandemic has led States to adopt various public health measures that adversely affect foreign investors and exacerbate broader economic issues. In this climate, there is significant potential for disputes under the ECT.
Cinco Días | 20-May-2020
Preparan una avalancha de demandas contra los Estados apelando a los tratados de inversión, según un informe de CEO y TNI
Basta! | 19-May-2020
Les cabinets juridiques spécialisés dans les conflits entre investisseurs et États étudient d’éventuelles plaintes contre les mesures suspendant les activités économiques, instaurant un moratoire des loyers ou rendant accessible à tous un futur vaccin.

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