Governments around the world enter into Free Trade Agreements to reduce tariffs and and expand global trade.
But trade agreements can and often do suit the interests of global corporations at the expense of people’s rights and the environment. When present, Investor State Dispute Settlement (ISDS) conditions increase rights for foreign investors and reduce rights for governments to regulate in the public interest.
Prime Minister John Howard refused to accept ISDS in the free trade agreement with the US and as a result Australia has avoided major issues that the US continues to suffer when dealing with other signatories, internal link, US Dolphin safe tuna labeling ruled a violation of the rights of Mexican fishers. Country of Origin labeling for beef and pork ruled a barrier to trade, US ordered to pay $1 billion per year.
“ISDS is a flawed system that allows a single foreign investor to sue a government over regulations which can be in the public interest and even if its unsuccessful, governments pay a very high price.
Its not really a legal system that has the safeguards that national systems have because there is no independent judiciary, lacks transparency and doesn’t properly consider public interest issues.” Dr Patricia Ranald, convenor of AFTINET speaking at an NGO conference in Singapore. External link with video: Dr Ranald Explains ISDS in Australia
Governments after PM John Howard continued to refuse ISDS conditions in trade agreements until PM Tony Abbott reversed the policy and quickly signed a succession of agreements containing ISDS. PM Malcolm Turnbull continues with Tony Abbott’s policy unchanged.