Wednesday, August 6, 2014

Treaties Committee Hearing Canberra 5 August 2014 – Korean Bilateral Trade Deal

During the Labor Government period Australia refused to agree to a deal with Korea that included an investor state dispute settlement clause. Why have we agreed to one now? We are not some banana republic that runs around confiscating foreign property.

Doesn't the ISDS give foreign investors rights that domestic investors don't have?

Didn't the Productivity Commission find in its 2010 Report on Bilateral Trade Agreements that foreign investors have greater legal rights than domestic businesses because ISDS gives them access to third party arbitration?

Isn't ISDS inherently anti-democratic – it means that governments that want to take actions that they believe are in the public interest, in the best interests of the nation, can find themselves being sued by multinational corporations and brought before arbitrators who in fact before or after the case might be hired by those same multinational corporations?

Isn't the case being brought by Philip Morris against the Australian Government over its plain packaging regulation, using the ISDS clause in the Hong Kong trade treaty, inherently undemocratic?

Given that a 2009 survey of ISDS found 33 cases with claims over $1 billion US, and more than 100 cases with claims between US $100 million and US $ 900 million, it's not right that the Philip Morris case is an isolated one.

Why does this Treaty have an ISDS clause and the Japanese treaty not have one? If the Japanese were happy enough to sign a Trade Agreement without an ISDS clause, why weren't the Koreans?

What did we get out of the Korean deal, as compared with the Japanese deal, that made this handcuff on our democracy worthwhile?

What modelling has been done to establish the likely impact of KAFTA on Australian manufacturing?

When you were negotiating the Korean deal, did you ask the Australian motor vehicle manufacturers Ford Holden and Toyota whether a bilateral Trade Agreement with Korea could risk bringing forward their closure date?

We have had evidence that there is a risk that one or more of these companies could bring forward their closure date. This would be terrible if it were true. It is absolutely imperative that the automotive parts suppliers that presently depend on these manufacturers get as much time as possible to find other markets or other products, and imperative that the workers at these factories have as much time as possible to find other jobs and develop other skills. The market theory is that these workers and businesses can move to other parts of the economy, but the market reality is that will not happen unless there is time. Ford is not scheduled to close till October 2016, and Holden and Toyota say they will motor on until 2017. Don't we need to hang on to this, rather than walk away from it?

During the course of the negotiations, who did you consult and in what detail?

The reason I ask is that the question of consultation has been highly controversial in evidence before the committee. On the one hand we have unions and civil society saying the se bilateral trade agreements are a closed book. No-one sees them till they are signed and they are then presented to the Parliament on a take it or leave it basis. They say there is nowhere near enough consultation or transparency. Then on the other hand we have the agribusinesses who give completely opposite evidence saying they couldn't be happier with the consultation and give the Department absolutely glowing reports. Now I think you would agree that all sorts of people have vested interests in these Trade Agreements – agribusinesses, manufacturers, unions, farmers, internet service providers, copyright holders, consumers and so on. Am I right in thinking that there is a double standard at work – that some people are kept in the loop, while others are kept in the dark?

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