Campaigners dressed as corporate wolves invade the streets of Davos, on the side lines of the World Economic Forum to protest against ISDS provisions.
Over forty of the corporations listed as WEF “Industry Partners” have been involved in ISDS cases, often intended to undermine or discourage progressive policy, including environmental protections, minimum-wage increases and public health measures.
ISDS clauses, found within a range of trade and investment agreements including the Trans Pacific Partnership (TPP) and the Comprehensive Economic and Trade Agreement (CETA), enable multinational companies to sue states via secretive international tribunals if governments take actions which they believe unfairly impede their profits.
The “Stop ISDS coalition”, an alliance of over a hundred NGOs, including Greenpeace, ActionAid and Public Services International organized the action as a launch for a petition to the European Union to end the promotion of ISDS and support a Binding UN Treaty on Transnational Corporations to give people and governments the ability to hold the private sector to account.
Some examples of ISDS cases by WEF corporations include:
- Cargill sued Mexico in 2005 after the Government implemented a tax on high-fructose corn syrup to address the country’s obesity crisis. Cargill used ISDS under Nafta to extract over $70 million in damages from Mexico’s public budget. Cargill used the WEF in 2018 to launch a Corporate Social Responsibility project, claiming to “address social issues using the power of food.”
- In 2015, Novartis threatened to use ISDS to successfully discourage the Colombian government from making a life-saving leukemia drug more accessible through compulsory licensing. The drug, which has brought in over €40 billion in revenue for Novartis, sold for over $15,000 per patient per year; twice the average person’s income.
- In 2008, Dow Chemical sued Canada after Quebec banned the manufacture and sale of harmful pesticides. Dow Agrosciences declared the subsequent settlement a victory, and commentators noted the case may discourage other Governments from moving ahead with their own pesticide bans.
Coalition spokesperson Alex Scrivener said:
While CEOs here at Davos try to present themselves as a force for good in front of politicians, many of them are suing governments to undermine the progressive policies we need. This is nothing less than sheer hypocrisy. ISDS is a huge threat to democracy, human rights and the environment. We need EU leaders to use Davos to commit to ending investor-state arbitration and concentrate instead on securing recourse for the millions of people across the world who are victims of corporate human rights violations.
Rosa Pavanelli, General Secretary of Public Services International (a Coalition member) said:
While labor conventions and corporate responsibility mechanisms are largely toothless, ISDS has the sharpest of teeth. It hands corporations huge payouts if progressive policy impedes private profit-making. We need to end this asymmetry by stopping ISDS and giving people the ability to hold corporations accountable via a Binding UN Treaty on Transnational Corporations and Human Rights.
Background Information on the Campaign against ISDS and for Corporate Accountability
We are an alliance of over 100 organizations, trade unions and social movements, campaigning in favor of corporate accountability rules for companies, and against Investor to State Dispute Settlement, a parallel, one sided and unfair justice system for corporations.
On January 22, 2019, the coalition launches a European petition across 16 EU Member states, calling on the EU and European governments to end corporate privileges by withdrawing from existing trade and investment agreements containing ISDS clauses, and to exclude them from agreements in the future.
The campaign also calls on the EU and Member States to support the achievement of a UN Binding Treaty on Multinationals and for domestic legislation to hold transnational corporations to account for human rights violations.
ISDS – KEY FACTS
- ISDS cases have led to awards of over $50 Billion USD from the public purse to private investors – more than the GDP of most nations.
- There has been an explosion of known cases in the last 20 years, from less than 10 in 1994 to 608 in 2014, of which 80% come from global corporations based in the US and Europe.
- US-based companies are by far the most frequent users, with twice as many cases as the country of the next largest users. Most cases are won by investors.
- Experts including Australia’s Chief Justice have raised serious concerns that ISDS is not independent or impartial.
- The ECJ recently ruled intra-EU ISDS cases are “incompatible with EU law.”
- The EU Commission’s public consultation on ISDS led to over 97% of respondents rejecting these corporate privileges
- EU Trade Commissioner, Cecilia Malmstrom, recently described ISDS as “the most toxic acronym in Europe.” This is part of the reason why the EU is currently attempt to create new acronyms for ISDS: ICS and MIC.
- Under ISDS, foreign investors have more rights than local companies and citizens – they can circumvent domestic courts and sue states directly through international tribunals.
- ISDS cases are usually heard by secretive courts made up of just three private arbitrators, appointed as “judges” – many of whom have previously worked for the companies taking cases.
- Even if a government wins the case, a 2012 OECD study found ISDS cases last for 3 to 5 years and the average cost is US$8 million per case, with some cases costing up to US$30 million.
- The Philippine government spent US$58 million defending two cases against German airport operator Fraport; money that could have paid the salaries of 12,500 teachers for one year.
- A recent WTO Working Paper found no empirical evidence that ISDS increases investment.
- ISDS has no system of precedents or appeals, so the decisions of arbitrators are final and can be inconsistent.
In short, ISDS is an enormously costly system with no independent judiciary, precedents or appeals, which gives increased legal rights to global corporations which already have enormous market power, based on legal concepts not recognized in national systems and not available to domestic investors.
Source URL — https://roarmag.org/2019/01/23/isds-wolves-invade-davos-world-economic-forum/