The latest terror of Brexit is that we’ll all be subject to the big bad multinationals being able to sue our democratically elected governments. As Caroline Lucas reminds us this is the purpose of those investor-state dispute settlement clauses in contracts. If governments do something that companies don’t like then the governments, poor dears, can be sued. In international courts, secret ones! Well, at least, ones that aren’t totally under the control of the government being sued.
At which point, well, what’s the European Court of Justice then? A place in which the national governments can be sued by individuals and companies isn’t it? For breaking the promises those governments have made in their own laws and contracts?
So why is being subject to the ECJ great and to ISDS not?
But something that has slipped by virtually unnoticed is the government’s plan to include investor-state dispute settlement (ISDS) mechanisms in future trade deals. ISDS clauses let foreign investors sue national governments for introducing policies that harm their profits. They have led to global corporations taking governments to secretive private arbitration courts in cases that can cost taxpayers billions.
There’s much that can be said about ISDS – like governments don’t always lose. That governments do promise things in laws and contracts and, like everyone else, need to be held to their promises at times. But let’s just stick with this one little question here.
The ECJ exists to hold governments to the promises they make. We’re leaving that. ISDS exists to hold governments to the promises they make. ISDS is already in every trade and investment contract agreement and treaty ever. Why this problem with it?