PSI | 7 May 2024
The tide is turning against the global court for corporations – ISDS
by Kate Lappin
After a decade long struggle by PSI and affiliates against trade rules that put corporate profits before people, victory is in sight!
Many of the rules that are found in bilateral and plurilateral trade agreements were written by corporations to protect them from public interest regulation.
The most dangerous of the rules adopted has been the Investor State Dispute Settlement (ISDS) clause, which allows corporations to sue governments in secretive courts for billions of dollars if their potential profits are put at risk by government policies, laws or practices.
But now the tide may be turning against ISDS and in the past month there’s been good trade news for people and planet.
In April, members of the European Parliament voted to withdraw from a treaty that has allowed fossil fuel corporations to sue governments if their climate policies or other regulations threatened their profits. The Energy Charter Treaty (ECT) has been used more times to sue governments than any other agreement.
On April 21st, Ecuadorian voters overwhelming voted to keep their constitutional ban on ISDS. PSI and affiliates had called for the ban against ISDS to be retained. While the conservative government were keen to bring back the corporate clause, the public rejected the proposal.
And in Australia, a parliamentary inquiry into Australia’s approach to trade recommended that the government seek to exclude ISDS from its trade and investment agreements. PSI made a submission to the inquiry and was invited to appear before the parliamentary committee, and PSI is repeatedly cited in the committee’s report. The committee also recommend that legislation be adopted to enable parliamentary oversight of trade negotiations; that human rights, labour and environment chapters be included; that independent impact assessments be conducted and that further consultations on digital trade rules be conducted to ensure the ability of governments to regulate in the public interest is not limited.
On 9th May, PSI’s Asia Pacific Regional Secretary, Kate Lappin, will be speaking on a webinar about the threat of ISDS to quality public services organized by the Australian Fair Trade and Investment Network (AFTINET).
More on the dangers of the ECT HERE.
