Category Archives: FTA

The Global Agreement Most of Us Know Nothing About

While focus has been on the recent Australia – China Free Trade Agreement, signed at the end of November, an agreement that could eclipse that and all other recent FTA’s Australia has signed continues to be debated and progressed with little knowledge from consumers or Australian businesses.

The Trans-Pacific Partnership could be Australia’s biggest trade deal for decades, but most people have not even heard of it. A survey released at the end of last year by the Australia Institute found 55 per cent of respondents did not know about the TPP, as it is known. Another 19 per cent said ”I’m not sure.”

Despite this there could be a range of significant consequences for AUSBUY members and the wider Australian business community.

For instance it has been reported that negotiations around government procurement in the TPP could restrict the ability of governments, including Australia, to preference local products and services over imported ones, including sustainable, locally grown food. This would limit their ability to shift towards a more sustainable food system on a local scale.

According to the Consumer advocacy group CHOICE, we can also expect higher medicine prices, the potential for Australians to face new criminal penalties and the right for big businesses, from overseas markets, to sue us if they don’t like consumer laws. A leaked draft suggests the US is pushing for criminal penalties, even jail, for illegally downloading popular television shows.

Leaked documents released by WikiLeaks also reveal the TPP include provisions to lengthen patents for some lifesaving drugs for up to an extra 12 years leading to Australian patients paying more for drugs for longer.

It is concerning that agreements that could have such far reaching consequences for Australian consumers and businesses alike have not had the open scrutiny they deserve. The main reason for this is that the negotiations are shrouded in secrecy. Convention dictates that international trade agreements such as this need to be discussed behind closed doors and the negotiating texts must remain confidential, driven by an agreement signed by the Labor government when the talks started.

In response to the claims by a number of groups of the secret nature of the agreements DFAT defended its position by saying that it ‘safeguards our negotiating positions and strategies’ and that there had been a lot of consultation. But many have claimed to have been excluded from real and meaningful dialogue.

Others have said that despite the secrecy Parliament will still need to ratify any agreement reached with our international partners. But others, such as Greens Senator, Peter Whish-Wilson, says they won’t have enough time to give it the proper review it deserves with only 20 days allocated to review the huge and highly complex agreement which goes far beyond a normal trade agreement.

“What is really unusual about the TPP deal is it goes way beyond what we would call the traditional trade in goods and services and breaking open market access. It straddles enormous areas of public interest and public importance, like for example internet usage, intellectual property, food labelling, quarantine standards. You really have to wonder what Australia has left to trade away in these deals, because the nature of these negotiations is you don’t get something unless you give up something.”

AUSBUY is concerned that we are being left in the dark about what we’re giving up during negotiations. We need transparency and a proper, considered process with adequate time to review the agreement to ensure Australia, consumers and business, don’t lose out.

Abbott: Open For Business — And Multinational Lawsuits

By Mike Seccombe September 20, 2013

Labor rejected it outright. Even the Howard government issued America with a rare “no” over the legislation, declaring it contrary to national interests. But now the Abbott Coalition is flirting with a trade agreement that would allow companies, acting increasingly in secret, to sue Australia if they don’t like its regulations.

Australia’s government under Prime Minister John Howard was not notable for its willingness to say “no” to America. Consider, for example, its eager enrolment in the coalition of the willing-to-believe-anything, and in the war of false pretences in Iraq.

And then there was the matter of trade. Coincidentally, a major purpose of John Howard’s visit to Washington in September 2001, where he was when the terrorists struck, was the pursuit of a free-trade deal.

Reversing a long history of resistance to the prospect of a bilateral free-trade agreement with America (Australia had rejected previous overtures as being not in our national interest, and was a leading proponent of multilateral trade reform, through its leadership of the so-called Cairns Group of nations), the Howard government was at first almost pathetically keen to do a deal with the United States.

If a mining company is unhappy with environmental safeguards which inhibit its operations, if a tobacco company does not like laws restricting cigarette sales, ISDS provisions in trade agreements give them the means to challenge government policy and to seek compensation.

In the end, however, Australians’ growing hostility to the trade agreement forced Howard, for once, to say “no” to George Bush.

It wasn’t a blanket refusal of an Australia-United States Free Trade Agreement (AUSFTA); a deal was eventually stitched up and began operating in 2005. The “no” was to one of America’s key demands: a provision called Investor-State Dispute Settlement, or ISDS.

What this arcane phrase refers to is the right of foreign companies to sue national governments of the signatory countries, not in domestic courts, but in opaque international forums, if they think some element of that government’s policy is harming their interests.

If a mining company, for example, is unhappy with environmental safeguards which inhibit its operations, if a pharmaceutical company is unhappy with the prices it gets for its drugs, if a chemical company is upset with the banning of an agricultural pesticide, if a tobacco company does not like laws restricting cigarette sales, ISDS provisions in trade agreements give them the means to challenge government policy and to seek compensation.

And they do this increasingly often, sometimes claiming enormous amounts of money. According to a report in May 2013 by the United Nations Conference on Trade and Development, which monitors these things, a record 58 ISDS cases were begun in 2012. In the same year, decisions were made on 42 cases by an assortment of more or less credible international arbiters. Only 31 of these were publicly disclosed, but of those, 70 per cent went in favour of the corporations, at least in part; and nine resulted in significant awards for damages, including one – to an oil company which sued Ecuador – for a record US$1.77 billion.