Southeast Asia Strategy A Chance To Stop Investors Like Clive Palmer Suing Australia For Billions

Australia's Southeast Asia Economic Strategy to 2040 announce today will “review the scope of existing Free Trade Agreements to determine priorities for agreement upgrade negotiations.”

“This review is welcome news for those deeply disturbed by the fact that Clive Palmer moved some assets to Singapore, claims to be a Singaporean investor and is using investor rights to sue governments in the Australia-New Zealand-ASEAN Free Trade Agreement to sue the Australian government for a massive total of $337 billion,” Dr Patricia Ranald, AFTINET Convener said today.

“It is absurd and outrageous that an Australian investor can use foreign investor rights in a trade agreement to ignore High Court decisions and environmental laws and sue our government for billions of dollars in an international tribunal.”

“Investor-State Dispute Settlement (ISDS) rules in some trade agreements enable foreign (but not local) investors to sue governments for billions of dollars if they can claim that a law or policy reduces their future profits. International investors have sued governments over public policies like tobacco plain packaging regulation and over the phasing out of fossil fuels to reduce climate emissions,” explained Dr Ranald.

Palmer lodged an ISDS case for $300 billion compensation from the Australian government for a decision of the Western Australian government after losing a High Court Appeal against the Western Australian government’s decision. His second claim is for $41.3 billion in compensation for the refusal of coal exploration permits for the Waratah coal mine in Queensland. The license was refused for environmental reasons, including its contribution to increased carbon emissions. He has also foreshadowed a third case, possibly to claim compensation for Federal and Queensland government decisions to refuse a license for a second coal mine in Queensland because of impacts on the local environment, local waterways and run-off affecting the Great Barrier Reef.

“Even if governments win cases they have to spend millions defending them. The Philip Morris tobacco company case against Australia’s plain packaging law took five years and cost $24 million in legal costs, of which only half was recovered by the government,” said Dr Ranald.

“The Labor government has a policy against ISDS in future trade agreements, and to review it in existing agreements. More and more governments are rejecting ISDS. It has not been included in the 15-member Regional Comprehensive Economic partnership (RCEP) of Asia-Pacific countries, nor in Australia’s recent FTAs with the UK and India, nor in current FTA negotiations with the EU,” said Dr Ranald.

“We urge the government to take this opportunity to accelerate the review and removal of ISDS from the ANZ-ASEAN agreement and from bilateral agreements with Southeast Asian countries”.

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