Monday, December 06, 2010



Against investment clauses

One of the worst features of modern free trade agreements are investment clauses. First emerging in NAFTA, these allow foreign companies to sue governments for profits "expropriated" by regulatory changes. Quite apart from the practical effects, which have seen the US government sued over its efforts to prevent the spread of BSE, the Canadian government sued for regulating dangerous fuel additives, and the Mexican government sued for demanding companies clean up their toxic waste, such clauses are also objectionable on principle. They basically say that democratic societies are not allowed to regulate where it might cause someone to lose money - even where such regulation is clearly in the public good. Such clauses freeze regulation and forbid us from acting on new challenges (or responding to old ones once the public will is there). The only people who win from them are sociopathic corporations who want to pollute, lie, and sell us unsafe products.

Last month, the Greens asked the government about whether they would permit such a clause in the Trans-Pacific Partnership. The government refused to rule it out, on the basis that it regarded the prospects of a challenge as "far-fetched" (despite all evidence to the contrary [PDF]).

Yesterday, they dropped the other shoe: evidence that tobacco giant Philip Morris intended to use any such clause to overturn any attempt at regulating tobacco, and specifically identifies moves to require plain packaging (law in Australia, recommended here) as "expropriation". And in case the government thinks that is "far-fetched", they're already doing it in Uruguay.

This shows that a TPP investment clause would be a clear and present danger not just to our sovereignty, but also to our health. We cannot allow it. The government must rule it out immediately. If not, we can only conclude they are on the side of the tobacco companies.