Nessa Childers, MEP for Dublin, criticised the Minister for Jobs, Enterprise and Innovation for signing a letter to the EU Commission, urging the inclusion of the highly controversial investor-state arbitration system (ISDS) in the EU-US trade agreement currently under negotiation.
Ms. Childers asks: “Is this official Irish Government policy? As I am appalled at Mr. Bruton’s decision to sign a letter to the new Commissioner for Trade, Cecilia Malmström, urging her to allow for special arbitration tribunals that multinationals can use to seek compensation from national governments for passing laws that hurt their interests.
“At best, this starry-eyed take on transatlantic trade is a failure to recognise what is in the best interests of our citizens. At worst, it demonstrates a willingness to allow big business an obscure, privileged and exclusive legal system to threaten and pursue governments for massive sums in compensation for legislating on environmental or social issues on behalf of their citizens.
“In order to enjoy the fruits of commerce across the Atlantic, we don’t need clauses that were invented in the 1950s to deal with what we then called ‘third world’, foreign regimes whose legal systems offered companies no protection against expropriation or serious discrimination.
“To the contrary, far from being a banana republic, the EU’s legal system does, more often than not, set the world’s highest standards across many areas. This is the very reason US-based multinationals are so eager to have their own system of recourse to curb state action.
“In recent years, these sorts of expensive, legally complex and secretive investor-state arbitration schemes have been multiplying, and their initial purpose has been turned on its head.
“Addressing my political group, the Socialists and Democrats, in Parliament, Commission President Juncker rightly committed not to allow parallel legal mechanisms to develop in the EU-US trade agreement, on the grounds that the EU is governed by the rule of law.
“Whatever you make of this, Mr. Bruton’s letter is riddled with inaccuracies.
“It denies the risks involved, ignoring that, for instance, Germany is already being pursued for almost €4 billion by a utility company in compensation for its decision to close its nuclear power plants after the Fukushima disaster.
“Australia was also challenged for its plain cigarette packaging laws by a big tobacco company which moved assets from the US to Hong Kong in order to be able to avail of the arbitration clauses contained in a trade deal between Australia and Hong Kong. This actually led the Australian government to consider discontinuing all its investor-state dispute settlement commitments.
“Mr. Bruton’s letter also claims that the Commission’s negotiation mandate with the US, which it got from EU governments, is clear in its inclusion of investor protection mechanisms.
“While I am disappointed to see this is apparently Irish government policy, Commission President Juncker has challenged that claim in an address to the European Parliament.
“Moreover, under the Lisbon Treaty, the European Parliament will have the final say on the whole EU-US trade agreement. I will oppose it if private, secret courts for investor-state disputes are included.”
Copy of Minister Bruton’s letter to Commissioner Malmström http://blogs.ft.com/brusselsblog/files/2014/10/ISDSLetter.pdf