The AFR’s Greg Earl has called for greater transparency in negotiations for the Trans-Pacific Partnership (TPP) trade agreement – the US-led trade pact between 12 Pacific Rim nations, including Australia – following concerns raised by the Productivity Commission (PC), the ACCC, and the Harper Competition review:
…the Productivity Commission, the Australian Competition and Consumer Commission and the Harper competition review [have] all question[ed] one of the most complex but core elements of the Trans-Pacific Partnership (TPP)…
They have a basic reservation about whether it is in Australia’s national interest to cave in to US demands for tougher IP rules because Australia is a net IP importer and thus would face a higher import bill.
But more importantly, they question the underlying economics of tightening IP rules when this is not a classic trade barrier reduction situation where everyone benefits from being encouraged to pursue their specialties under comparative advantage theory.
As the PC argues in its submission to Harper: “Where not warranted to incentivise innovation, the patent system can impose costs on the community by impeding competition”…
These are not the ravings of poor souls who don’t understand poker, they are serious concerns about a very complex agreement…
Pat Ranald, research associate at the University of Sydney and expert on Investor-State Dispute Settlement (ISDS) clauses in trade agreements, has also published concerns about the TPP at The Conversation:
ISDS enables foreign investors to sue governments for compensation in an international tribunal if they can claim that a change in law or policy has “harmed” their investment…
ISDS has no system of precedents or appeals, so the decisions of arbitrators are final and can be inconsistent. In Australia, and most national legal systems, there is a system of precedents which judges must consider and appeal mechanisms to ensure consistency of decisions.
…comprehensive figures from the United Nations Committee on Trade and Development indicate that of 356 known cases, 53% have been either been won by investors or settled. Settlement indicates that the state had to either pay some compensation and/ or withdraw the law or policy which was the basis of the case. US companies are the most frequent users of ISDS. The Howard Coalition government did not agree to ISDS in the Australia-US FTA. The TPP, which includes the US, would expose Australia to more examples like the Philip Morris case.
ISDS gives already powerful global corporations additional rights to sue governments over democratically decided public interest law and policy. The President of the World Health Organisation has documented how tobacco companies developed a strategy of using ISDS cases to discourage tobacco regulation. TPP governments would be foolish to expose themselves to more such cases by agreeing to ISDS in the TPP.
It is worth re-iterating that Liberal Party senator, Bill Heffernan, has expressed concerns “about unintended consequences” of the TPP, including “the capacity for corporations to sue governments”, and has called on the Government to release the draft text to the public so that it can be tested by people with “dirt under their fingernails”.
If the concerns of Heffernan, the PC, the ACCC and Harper Competition Review are not enough to have the TPP draft text released for public consultation, I don’t know what is.
The bright lights of transparency need to be shone on this agreement, to ascertain whether it is in the public interest and to weed-out any unintended consequences, before it is too late.
