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Ichingcarpenter

(36,988 posts)
Fri Mar 27, 2015, 12:45 PM Mar 2015

WikiLeaks - Secret Trans-Pacific Partnership Agreement (TPP) *Classified Chapter Leaked!* (

Procedural Rights Only Available to Foreign Investors


Foreign investors alone would be granted access to extrajudicial tribunals staffed by private sector lawyers who rotate between acting as “judges” and representing corporations in cases against governments, posing major conflicts of interest.


The leaked text includes provisions that submit TPP signatory countries to the jurisdiction of World Bank and United Nations investor-state arbitral tribunals. These tribunals, staffed by private sector attorneys (Article II.18.4), would be empowered to order governments to pay investors compensation for what the attorneys deem to be violations of the TPP’s investor rights.

The tribunals lack public accountability, requirements to follow precedent, or standard judicial ethics rules. The leaked TPP text itself has no requirement for tribunalists to be independent or impartial. Rather, it relies on weak impartiality rules set by the arbitration venues themselves. In the 48-year history of the World Bank arbitration regime, which is most commonly used, tribunalists have only been disqualified in four of 41 challenges of exhibited bias or conflicts of interest. Rulings by tribunalists with specific conflicts of interest have been allowed to stand. A tribunalist ruling that Argentina had to pay Vivendi Universal $105 million for reversing a failed water privatization served on the board of a bank that was a major investor in Vivendi. The tribunalist did not disclose the conflict, much less recuse herself, and Argentina’s effort to annul the ruling was dismissed.
Foreign tribunals would be empowered to order governments to pay unlimited cash compensation out of national treasuries.


The leaked text provides tribunals with discretion to determine the amount of compensation governments must pay investors (Article II.28.1) and also the allocation of costs (Article II.28.3), such as the tribunalists’ fees. Even when governments win ISDS cases, they waste scarce budgetary resources defending national policies against these corporate attacks, as $8 million in taxpayer funds must be used in an average ISDS case to pay large hourly fees for the tribunals and legal costs. An earlier leaked version of the TPP investment chapter included a proposed provision to standardize hourly fees for tribunalists at the lower end of the range of fees currently paid (about $375 per hour, compared to the $700 per hour that some tribunalists receive). But that restriction on tribunalist fees has been scrapped in the recent leak.


The TPP would grant foreign investors procedural rights that are not available to domestic firms to “sue” governments outside of national court systems, unconstrained by the rights and obligations of countries’ constitutions, laws and domestic court procedures.

The portion of the leaked text that enumerates the private ISDS enforcement system largely replicates word-for-word the provisions of past U.S. ISDS agreements. However, foreign investors would be granted even more time to launch an ISDS case. While existing U.S. FTAs already allow foreign investors to initiate ISDS cases up to three years after the investor became aware of the alleged violation of their special foreign investor rights, the leaked text would expand that timeframe by another six months (Article II.20.1). This text also abandons a proposal in the 2012 leaked text that would have required a foreign investor to pursue domestic legal avenues before launching an ISDS case. This “exhaustion” requirement would have obliged investors to pursue domestic administrative review before launching an investor-state case. Exhaustion of domestic remedies is a fundamental principle of international law.


The leaked text shows that foreign investors would be able to demand compensation if new policies that apply to domestic and foreign firms alike undermine their “expectations” of how they should be treated.
This includes a right to claim damages for government actions (such as new environmental, health or financial policies) that reduce the value of a foreign firm’s investment (Article II.7 and Annex II-B on indirect expropriation) or that go against the expected level of regulatory scrutiny that an investor might have had when dealing with a previous government (Article II.6 on minimum standard of treatment). After a series of alarming ISDS rulings based on language replicated in the leaked TPP text, annexes were added to U.S. FTAs starting with the 2005 CAFTA with language aimed at defining what sorts of government action should be considered an “indirect expropriation” or a violation of the “minimum standard of treatment” guarantee given to foreign investors. However, ISDS tribunals already have ignored these provisions in cases brought under recent U.S. FTAs that included the so-called safeguards now being touted with respect to the TPP, and instead have continued to develop their own broad interpretations of foreign investors’ rights to rule against governments and order compensation to investors. The leaked TPP text largely replicates these failed annexes, meaning that ISDS tribunals would maintain enormous discretion to order a government to pay a foreign investor merely because the government improved a regulatory policy applying to both domestic and foreign firms. Indeed, the inclusion of the language from past FTAs on a guaranteed minimum standard of treatment for foreign investors and the right to compensation for indirect expropriation directly contradicts the assurances TPP governments have given to legislators and public interest advocates that the pact would safeguard regulatory sovereignty.



https://wikileaks.org/tpp-investment/?t=dXNlcmlkPTUyOTc1NDAxLGVtYWlsaWQ9OTYyNg==

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WikiLeaks - Secret Trans-Pacific Partnership Agreement (TPP) *Classified Chapter Leaked!* ( (Original Post) Ichingcarpenter Mar 2015 OP
Glad this information is getting some sunlight. NT Trillo Mar 2015 #1
K&R and good to see the pro-TPP crowd have fits over this Populist_Prole Mar 2015 #2
not at all. They seem to be convinced that it's not actually happening Doctor_J Mar 2015 #6
so this week's corporate advocate is next week's judge? That sounds fair. Doctor_J Mar 2015 #3
'Compensation' most likely comes into play when protectionism is determined. randome Mar 2015 #4
''No corporation is going to invalidate our safety or environmental laws.'' Ichingcarpenter Mar 2015 #5
 

Doctor_J

(36,392 posts)
6. not at all. They seem to be convinced that it's not actually happening
Fri Mar 27, 2015, 04:42 PM
Mar 2015

See the post below this one, or yesterday's "has anyone verified this document is legitimate"? My guess is that when it's passed, we'll hear how great it is that we have the same safety and environmental standards as Bangladesh.

 

randome

(34,845 posts)
4. 'Compensation' most likely comes into play when protectionism is determined.
Fri Mar 27, 2015, 01:56 PM
Mar 2015

No corporation is going to invalidate our safety or environmental laws. But a country cannot concoct tariffs or bogus laws to keep a specific country from doing business within their borders if such measures are deemed to be nothing more than protectionism.

Without having the full treaty to peruse, I'm sure that's what that means. But I suppose we will eventually find out.
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