ISDS is an acronym for investor state dispute settlement. It is a feature of the North America Free Trade Agreement that gives foreign investors the right to sue Canada if their potential profits are limited by any legislation passed by any level of government within Canada. It is a partial surrender of national sovereignty, which is what all treaties involve. Its poisonous nature was first revealed when the U.S.-based Ethyl Corporation sued Ottawa for passing legislation that banned the import and inter-provincial transportation of a manganese-based fuel additive called MMT. The additive, made by Ethyl, had already been outlawed in the United States by the Environmental Protection Agency. Despite this, Ethyl, acting under the terms of NAFTA, sued Canada for lost profits from the sale of the additive.
Let’s get back to basics. Any national government, no matter how small, has, in the interest of its citizens and the environment in which they live, the right to control the activities of all corporations, both domestic and foreign, within its borders. If this is not recognized as an over-arching principle of international relations, it should be. If foreign corporations don’t like the rules and if governments can’t or won’t change them, the foreigners should pack up and leave, without protest.
According to some sources, Canada was being sued by the Ethyl Corporation for $350 million US. According to another account, Ottawa caved and made an out-of-court settlement of US $13 million. Canadians should have known all about it, but they didn’t. Canadians should have been outraged, but they weren’t.
The Canadian Centre for Policy Alternatives claimed in 2015 that Canada had paid out CAD $172 million to settle claims brought by U.S. corporations and that adjudications of a further $6 billion in claims were pending.
With this experience in mind no informed Canadian could justify the presence of the same corporation-friendly feature in the Trans Pacific Partnership and the European trade deal that was initiated by the former Conservative government. With the second coming of a Trudeau to the hallowed halls of parliament, avid supporters believed Justin Trudeau would excise the offending feature or else was in possession of a magic formula that would inoculate Canadians against its harmful consequences. Anybody who believes this is plainly wrong. Trade deals are treaties and treaties limit the sovereignty of nations for whatever period they remain in effect.
The pending trade deals are being presented as beneficial to all sectors of the Canadian economy and harmful to none. Visualize them as beautiful red apples hanging in a tree and then realize that ISDS are worms in both of them.
Consider the immensely profitable investment of Swiss-based Nestle in Canada. The company draws 316 million litres of water from an aquifer that is also the water source for the communities of Fergus and Elora, Ont. The company pays the Province of Ontario $3.71 for a million litres. On average, the retail price of a single litre of bottled water is $1.20. Such a wild profit margin is unconscionable.
In British Columbia, Nestle is extracting 265 million litres of water annually from aquifers that are of vital importance to Canadians, many of whom reside in First Nation communities. The province raised the price to $2.25 per million litre in 2016. Thus far, there has been no public announcement that Nestle in the United States will sue Canada under the terms of NAFTA.
It is reasonable to assume the NDP will oppose both new trade deals. Unless the Trudeau Liberals rediscover their pre-election conscience, the pacts will be approved. Under the terms of CETA, Nestle from Switzerland will become a new player in the piratical plundering of Canada’s fresh water resources. ISDS are not only impractical, they are immoral.
Canada is a democracy. Government has a duty to provide fair and equal treatment to its citizens. ISDS infested trade deals make foreign corporations, to quote George, “more equal” than anybody else.
