TPP Constitutes 'Threat to Democracy' in Canada, New Report Warns

The proposed Trans-Pacific Partnership, or TPP, would grant multinational corporations the ability to undermine Canadian sovereignty and would prioritize corporate profits over public welfare, according to the The Canadian Centre for Policy Alternatives, CCPA.

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In a report authored by trade expert Gus Van Harten, the Investor-State Dispute Settlement, ISDS, one of the most contentious provisions in the already-agreed TPP, would allow foreign investors to use private tribunals to demand compensation for government actions that affect corporate profits.

“The TPP’s arbitration process to protect foreign investors contradicts basic principles of judicial independence and fair process. For this reason, it is not compatible with the rule of law,” the report argues.

The publication titled, “Foreign investor protections in the Trans-Pacific Partnership,” argues that the TPP would enable powerful corporations to use the ISDS system to demand financial compensation over “policies they don’t like” such as environmental protection and financial regulation.

The study goes on to note that ISDS takes place in “unaccountable legal tribunals”—which lack judicial safeguards and transparency measures—that are decided by lawyers outside of the Canadian judicial system.

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“The arbitrators would not be accountable like a legislature. They would not be capable of regulating like a government. They would not be independent or fair like a court,” the report states.

To illustrate, the study cited a recent report that found that over 90 percent of ordered compensation in foreign investor claims against countries went to corporations with over US$1 billion in annual revenue—most had over US$10 billion—or to individuals with over US$100 million in net wealth.

The study concludes that expanding and enshrining such investor privileges carries major risks for vot­ers and taxpayers in all TPP countries, with no compelling evidence of a corresponding benefit for the public.