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CETA

by Frank Schnittger Wed Dec 16th, 2020 at 10:32:54 PM EST

The Canada-Europe Trade Agreement (CETA) ratification process in the Irish Senate has been delayed following a split in the Green Party on the issue. Michael McDowell is a prominent barrister, senator, former deputy prime minister, ex-leader of the now defunct Progressive Democrats party and long term advocate for neo-liberal policies in Ireland.

He has excoriated the Irish government for trying to railroad the ratification process through parliament with only 55 minutes of debating time particularly as it contains controversial clauses allowing global corporations to sue sovereign states if their policies have adverse effects on their profitability.

The Irish Times has published a letter to the editor I have written in response:


A chara, – It is not often that I find myself in complete agreement with your columnist Michael McDowell (“Canada trade deal shows Government’s breathtaking arrogance”, Opinion, December 16th), but the importance of the issues he raises in relation to the Canada-Europe Trade Agreement (CETA) is unarguable.

Allowing global corporations the right to sue sovereign states because their profits might be impacted by democratically mandated changes in government policy towards (say) oil exploration, mining, fracking, workers’ rights, consumer rights, taxation or public health is a fundamental subversion of democracy.

Governments make such decisions all the time and must be allowed to do so without fear of being sued by investors disadvantaged by same. Investment decisions are fundamentally about risk assessment, and it is up to investors to ensure they have properly estimated the risk and costs of any such decisions a government might make.

The right of investors to private profit cannot be allowed to trump the duty of governments to make decisions for the common good of their citizens. This principle is not diminished by the replacement, in CETA, of an investor-state dispute settlement (ISDS) arbitration system with an “Investor Court System” outside the supervision of our national courts.

What laws will this “Investor Court System” apply, if not those passed by the Oireachtas under our Constitution? Who will appoint the judges, and on what basis? Will there be a revolving door between judicial appointments and senior executives of global corporations, or the global law firms specialising in such litigation and profiting from same?

As Michael McDowell asks, “Why should multinational corporations enjoy parity with sovereign states, especially when they demand the right to exist offshore for taxation purposes?”

CETA, like the now stalled TTIP agreement between the EU and the US, represents a power grab by mostly US-owned global corporations against the interests of democratic states. By all means let global corporations do business here, but they should do so on our terms, and subject to our laws as interpreted by our courts.

Our world is changing, with more and more power in the hands of investor-owned global corporations vis-a-vis democratic states. However, we must not formalise their de facto influence into de jure control. We wish to live as citizens ruled by governments rather than as employees and customers ruled by corporations and their shareholders. – Yours, etc,

I am aware that CETA has provisions protecting actions taken in pursuit of the Paris climate agreement, and that successful litigation under the Treaty may be rare. But why concede the principle that there should be one law and judicial system for mega rich global corporations, and another for everyone else?

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I'm surprised a dyed-in-the-wool neo-lib would be opposed to corporations suing countries to protect profits.  US neo-libs would say, "That's not a bug, that's a feature."
by rifek on Thu Dec 17th, 2020 at 04:45:45 PM EST
He's a leading lawyer who wants to keep the business in the family... Besides which, the government didn't consult with HIM or offer HIM a job.

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by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Dec 17th, 2020 at 05:10:11 PM EST
[ Parent ]
What's the problem?
Corporate Sovereignty is central to these "trade deals", that's the whole point (corporations are people too).

The EU is pledging the Green New Deal on one hand while the other hand is promoting augmented carbon footprint with agricultural products shipped from the other side of the planet and no recourse from the ordinary voters.

by Bernard on Thu Dec 17th, 2020 at 06:30:55 PM EST
Ah yes, but that's somebody else's carbon footprint - as in the Mercusur deal where Brazilian jungle will be burnt to make way for pasture for cattle to be shipped half way across the world so Irish cattle don't contribute to methane emissions...

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by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Dec 17th, 2020 at 06:51:25 PM EST
[ Parent ]
Well, only one of those really is legally binding isn't it?
by generic on Fri Dec 18th, 2020 at 02:17:31 AM EST
[ Parent ]
The Irony is that Brexit is justified on the basis of being able to negotiate more favourable trade deals just as trade deals are going out of fashion...

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by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Dec 17th, 2020 at 07:15:10 PM EST
You have listed all of the reasons I opposed the USA joining the Trans Pacific Partnership - but principally the right of corporations to sue states over regulations that hurt profitability. Hillary had to slow roll her support for this vile treaty because it stank so much. But she had already pocketed most of the contributions that had bought her support.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Dec 18th, 2020 at 03:31:14 AM EST
The irony is that US courts often stand accused to favouring US corporations and dealing harshly with foreign own firms precisely because they are foreign owned. Trump's recent unevidenced assertions that Chinese firms must divest their US asset at knock down prices being another case in point. You can imagine Trump's outrage if a European country or court where to order (say) Facebook to sell off all their EU assets at knockdown prices to a European or Chinese competitor.

He was even threatening sanctions against France because it planned to introduce an across the board digital sales tax because it would disproportionately impact dominant US digital giants like Amazon even though it was only levelling the playing field between on-line and high street retailers who have to pay rates etc.

So I understand a certain logic to trying to ensure a level playing field for corporations of various nationalities in an open market. The alternate view is that if you want to sell into a market you must play by its rules and adjust your investment strategy to accordingly to take the risk of hostile court decisions into account.

But if you want to have supranational courts - indeed global courts - to regulate global corporations you have to be very clear as to what laws will be applied and how impartiality will be assured. You can't have one law and judicial process for global corporations and another for everyone else. Current political trends are all against globalism in any case and it is a valid political choice for a nation to decide what the rules should apply on its territory, even if that leads to reduced competition and productivity in some cases.

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by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Fri Dec 18th, 2020 at 12:18:49 PM EST
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