"Corporate courts are fundamentally unjust and should have no place in modern trade and investment policy."
A parliamentary report published Tuesday warns that investors could have huge new powers to sue the government after Brexit, as EU trade arbitration could be replaced by investor-state dispute settlement (ISDS), which means corporations will play a role in settling trade disputes, rather than an independent third party.
Britain has not yet defined how they will handle trade disputes after Brexit, without EU arbitration. One option that hasn’t been ruled out is ISDS, but a Parliament’s international trade select committee published a report warning against this.
“It must carefully consider and fully evaluate specific alternatives to conventional ISDS provisions,”adding that there must be a “counterbalance investor rights.”
Under ISDS, if there is a dispute over an issue like nationalization of a private company, investor capitalists would have the power to adjudicate and hand out huge fines to the taxpayer, penalising them for state takeovers of private interests, making the cost of public ownership considerably higher.
The report pointed out that in countries with ISDS, investors have take millions from the public purse. In Armenia, a British mining company is currently suing the small country’s government for $2 billion after environmental protesters blocked access to the site.
Anti-poverty charity ‘War on Want’ responded to the findings saying, “Corporate courts are fundamentally unjust and should have no place in modern trade and investment policy. We believe corporate courts should simply be dropped. Brexit, especially a no-deal Brexit, could easily lead to the UK being sued in its turn.”
The report lambasted the government for being “unable to set out even basic lines of policy” for trade disputes following Brexit, when the U.K. will have to leave EU regulatory frameworks.
Global Justice campaigner James Angel spoke to the Morning Star denouncing the lawsuit against Armenia’s government, he said, “With locals vowing to do all they can to save their water and land, it’s down to those of us in the UK to join them in speaking out against this UK-registered mining firm’s toxic attack on democracy.”