Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

It does not give me a great deal of pleasure to rise to speak to the Trade and Foreign Investment (Protecting the Public Interest) Bill 2014, but I want to congratulate my colleague Senator Whish-Wilson for bringing this bill forward. It still leaves me somewhat speechless that behind the scenes the Australian executive—through our trade minister and senior trade bureaucrats—are negotiating a treaty that would see Australia effectively subordinate state and national law to global corporate trade law. What this bill seeks to do is take on one element of the Trans-Pacific Partnership, which is being negotiated in secret as we speak and which, depending on which rumours you believe, may be as close as two or three weeks away from being signed and then presented to this parliament. This is as a trade agreement being signed under cover of total darkness. Isn't it interesting that when the global community gets together to negotiate difficult and complex environmental agreements that happens out in the open? The negotiators from various parties trying to hammer out climate change agreements have to do that in open forum. Sure, there are deals done in back rooms and all the usual things that go on, but everybody knows what it is that Australia would be potentially signing up to. When it comes to global trade agreements, not even the minister necessarily knows.

I think that the first thing that we need to get very clear about when we consider the Trans-Pacific Partnership is that this is not a free trade agreement in the sense that we are used to. It is not even being negotiated between sovereign governments. It is actually being negotiated between large corporate entities in various sectors, and those corporations—whether big pharma, rights holders, the biotechnology industry or agriculture; take your pick—are then handing negotiating positions to trade negotiators in various countries and having those positions hammered into a text. This is an agreement being hammered out by global corporations in their benefit. It is an investors' rights agreement; it is not a free trade agreement.

We only know the little that we know about the actual text of the Trans-Pacific Partnership because whistleblowers have leaked draft chapters of the text—two iterations of the IP chapter and one iteration of the chapter relating to environmental protection—to the WikiLeaks website. While that organisation has been hammered from all quarters, it has never been proven to be more important than now as the place where we can go to find out exactly what is being done in our name.

So I congratulate Senator Whish-Wilson for bringing forward this very targeted bill. It obviously does not go to the entire scope of the Trans-Pacific Partnership, because nobody will tell us exactly what that is, but it does go to the very specific notion of investor-state dispute mechanisms—one of those acronyms that might make your eyes glaze over, until you realise that what it allows to happen would be for multinational corporations to sue sovereign governments. This parliament considers itself sovereign, and I know from personal experience that the mob at the Tent Embassy and around the country—traditional owners—would take very strong issue with that. The business of sovereignty in this country is probably the most important piece of unfinished business for us to confront. But the fact is that, from the prayers that were just read in, you would assume that those from all sides of this parliament come in here charged with making and amending laws and providing good governance in the interests of everyone across this continent. But what happens if the laws that we pass in here are found to be offensive to the profit-generating activities of corporations on the other side of the world? The Australian government—as is actually occurring, although I am not sure many people are aware of it—could be dragged into a tribunal of unelected foreign trade bureaucrats, sued and forced to amend the affecting regulation if it impinges on the profits of a company on the other side of the world.

It sounds insane, but that is in fact precisely what is being negotiated behind closed doors by the Australian government and, when they were in government, by the Australian Labor Party. One of the things that I hope that Senator Carr or whoever speaks on behalf of the Labor Party will do when they are given the opportunity is put some cards on the table and make it very clear where the ALP stand. My understanding is that they would be in support of Senator Whish-Wilson's bill. When they were in government, I think they did have form in opposing investor-state dispute mechanisms that would allow state or federal governments to be sued by corporations who found themselves offended, but it is not at all clear where they stand now. So that is another reason why I would like to thank Senator Whish-Wilson for bringing this debate forward today.

Professor Joseph Stiglitz, who is a Nobel laureate in economics and somebody who spends a fair bit of time thinking about these things, said the following:

The TPP proposes to freeze into a binding trade agreement many of the worst features of the worst laws in the TPP countries, making needed reforms extremely difficult if not impossible.

The investor state dispute resolution mechanisms should not be shrouded in mystery to the general public, while the same provisions are routinely discussed with advisors to big corporations.

None of this is being done in the national interest. This is an agreement being hammered out in the corporate interest. If somebody as esteemed in his field as Professor Stiglitz is of that view, we should take that very, very seriously.

We are fortunate, as I said to those staff, campaigners and journalists in the publishing organisation WikiLeaks, that they have had the bravery to have stayed in business despite the extraordinary persecution that has been meted out to them so that we do have some sense of what is in the IP chapters. There are some very specific concerns. I want to concentrate today mostly on an area that is very dear to me: areas around freedom of information, freedom of speech and digital rights, which are placed explicitly under threat by what we find contained in the IP chapter of the Trans-Pacific Partnership and also by what happens when you bring investor-state dispute mechanisms to bear on some of these issues. A lot of damage was done when Australia signed the Australia-US Free Trade Agreement, and I think it has been government policy to try to avoid, if possible, forcing any amendments into domestic law as a result of the IP chapter. It is not at all clear whether that is actually the case. We may be faced with a bill which we will be told, on a 'take it or leave it' basis, that this parliament has to pass.

I would also say, for those who may be following this debate from outside and may be a bit confused by the government's rhetoric of due process, that we have the treaties committee, which is designed to evaluate mechanisms like the TPP. I served on the treaties committee for 5½ years—nearly six years. That committee will not get a copy of the Trans-Pacific Partnership until after the government signs it. And while the committee, in my experience, does apply a very critical eye to these things, the government is not bound to accept any of its recommendations. The treaties committee will do the best that it can, but the agreement will already have been signed—trade ministers' and prime ministers' signatures will already be on the document—by the time Australia's accountability and oversight mechanisms get the chance to take a look at it. And then it will be a case of this parliament being told—effectively with a gun to its head—that it has to pass the enabling legislation to bring some of these provisions into force. What an utterly backwards and antiquated process for dealing with such an important issue.

So, we have already done a certain amount of damage in Australian law. We effectively imported some of the worst aspects of US IP law, without their protections. The US has fair-use clauses, which mean that you cannot be prosecuted under US intellectual property law for doing stuff that is quite clearly not impinging on profits—commercial-scale piracy and that kind of stuff. In Australia the situation is very much unclear, and it appears that the Trans-Pacific Partnership, from what we know of the IP chapters, will make that situation much worse. And that is my principal question of what the rush is in bringing in mandatory data retention legislation—not necessarily so that the Federal Police can go and prosecute people who are found to be file sharing but so that rights holders from the US and elsewhere can go and trawl the metadata records of your teenage kids and send them threatening legal letters and the threat of gargantuan fines unless they pay up, or lengthy court cases unless they pay enormous fines. That is the kind of world that we are potentially stepping into here.

The document as it stands contains disproportionate and inappropriate enforcement provisions. It is all about enforcing the rights of rights holders, most of them from overseas, and there is nothing at all about public interest protections. Just to give you one example, a couple of years ago the Australian Law Reform Commission, partly in response to some of the damaging provisions that we embedded in Australian law after the Australia-US Free Trade Agreement was brought about, conducted quite a detailed inquiry into the copyright regime that prevails here in Australia. One of the recommendations they made at the time was to bring fair-use provisions—to effectively import some of the protective measures that exist in US law. We have the punitive stuff; we do not have the protective provisions.

And the fact is that if we were to now do so—if we sign up to the Trans-Pacific Partnership, which then embeds all kinds of property rights that did not exist before, for the rights holders—if this parliament then decided to do as the Australian Law Reform Commission recommended and institute a fair-use regime, that could be struck down by unelected trade bureaucrats in a tribunal, and the Australian government might choose to not even contest what would likely be a very expensive and extensive arbitral process. So, it may be that Attorney-General George Brandis, who is quite clearly listening only to the rights holders, does not even decide to contest it. It is that chilling effect on domestic legislation that is such an important and terrifying part of what this government is negotiating behind the scenes. And it looks like extension of copyright terms is in the agreement as well. That effectively just takes material out of the public domain for decades. It makes the work of cultural institutions and collection agencies that much harder, and it robs us of our own culture. 'Copyright term extensions' sounds arcane, but basically it just means all this rich cultural material simply going dark, archival institutions not even being able to digitise or make copies of material that in analogue form is degrading or being lost.

So, we have a very significant problem, and it is one that this parliament will not be able to address until it is far too late. I think one of the simplest things we could do is bring forward this bill for a vote today and pass into Australian domestic law protections against any Australian government signing us up to investor-state dispute mechanisms. That is the thing to do if you are concerned about fracking, if you are concerned about advertising tobacco products in places where kids can see it, if you are concerned about a ban on uranium mining, for example, or any of those issues where communities come into collision with powerful corporate interests, whether it be tobacco, big pharma, genetically modified organisms in our food, or the fracking industry—take your pick. Anywhere that these major collisions between the corporate interest and the public interest are underway, these very same corporations are seeking that power to sue us, to sue this parliament, to sue state parliaments.

Nobody on the government side of this chamber will make eye contact this morning because they have not read the agreement either. They have no idea what is in it. They just hear from our trade bureaucrats: 'It's fine; we're looking after the national interest. It's a free trade agreement like nothing you've ever seen before.' Well, at least that part is true.

But we owe it to ourselves and to our constituents, and to the future flexibility of this legislature to be able to do its job, to protect ourselves from predator capitalism and from these corporate interests, unelected, on the other side of the world, who would like nothing more than to subordinate the law-making power of this chamber and the other place to their own interests. All you would need to prove—and not even really prove; all you would need to be able to show—is your future potential profits in fracking underneath a residential subdivision or farmland, your future potential profits in opening up a carcinogenic uranium mine or your future profits in being able to track down and prosecute teenagers BitTorrenting stuff that they cannot get any other way, to be able to sue a government, to sue this parliament.

So I hope that we will see a measured, intelligent, evidence based debate on this this morning. I hope that the Labor Party will come clean with the Australian population about what its policy actually is. We will be listening beyond words, and we will be looking for a voting intention. And I hope the government might want to stand up and maybe even table a draft of the Trans-Pacific Partnership Agreement. That is not a serious expectation, but how about it? If this document is so benign, if it is in the public interest, if it is going to lead to a massive increase in GDP, if it is going to be a huge benefit to our agricultural sector or whoever else you think you are out there negotiating on behalf of, then put it into the daylight. Let us see the document. Let us see what is being negotiated in our names behind closed doors.

This bill should pass into law. It will not solve many of the issues contained in the Trans-Pacific Partnership, if this government is so reckless as to sign on. We will have to fight that through this parliament and in the community. But, once these agreements are signed, they are perilously difficult to unravel. They are impossible to wind back—because we will have granted property rights effectively across all of our collective futures to these corporations that only care about property rights and the profit motive.

It is our job, I think, to protect the public interest, not the commercial interest and the corporate interest. Our job in here today is to protect the public interest. So I look forward to a resolution of this matter so that we can send this bill to the other place for assent and protect ourselves from making potentially one of the most reckless and dangerous mistakes any parliament could make, which is to handcuff itself from its future legislative obligations to the people of this country.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

I must be guilty! Apparently we are all beholden to corporate interests and corporations. I do not know if the strings are visible to people today, but I am just a puppet, apparently, for corporate interests. It is all based on conspiracies. It reminds me—there was a great movie, Team America, and one of the characters in that movie was asked to explain their claims about corporations. They said, 'Oh, yeah, well, corporations are out there, and they do corporationy things, and they go and make money.'

There is no evidence here at all. There is no evidence. And I have not just sat through and listened to Senator Ludlam's speech. I have read Senator Whish-Wilson's first contribution, his second reading speech, and also flicked through Senator Di Natale's speech, and there is no evidence. They have provided no evidence at all. They have only relied on base conspiracy theorists. That is where the Greens are ending up right now. They are relying on conspiracy theories rather than evidence. If these things were so bad, we would have some evidence of their ill effect. We would have some ill effect, because—

Senator Siewert interjecting—

Well, you are putting this bill up. And the requirement is on people bringing a bill to this chamber to provide evidence of why we should put it in place. We should not put legislation in place where there is not an identifiable problem that needs to be fixed. I think we can all agree on that. That is why we should pass laws in this place: to fix a problem that exists. Now, where is the problem?

We have already four FTAs with ISDS provisions in them. We have 21 bilateral trade agreements, bilateral investment agreements, with ISDS provisions in them. Some of those agreements go back 25 years. If there were problems with these provisions they would have manifested themselves. We have agreements with Singapore, Thailand, ASEAN and New Zealand, all with these provisions, but there are no problems. I will not name the 21 countries.

Over those 25 years—and this is something none of the Greens senators have mentioned—how many cases do you think the Australian government has been subject to, under these provisions? Senator Whish-Wilson, you probably know. How many cases?

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Why don't you ask the Productivity Commission?

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

One case. I will get to the Productivity Commission. And that case has not even been resolved yet. This is a well-known case brought by Philip Morris on plain-packaging regulations. I will get to the international evidence, too, Senator Whish-Wilson.

The Productivity Commission has been verballed a little. I note that some of the Greens senators have taken to quoting the Productivity Commission, saying that we should not include these provisions in ICS agreements. Let us read the whole quote of the Productivity Commission.

Richard Colbeck (Tasmania, Liberal Party, Parliamentary Secretary to the Minister for Agriculture) Share this | Link to this | Hansard source

Selective quotes!

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

I would not expect the Greens to do selective quoting, but there is a first time for everything. This is exactly what the Productivity Commission said:

Australian Governments should seek to avoid the inclusion of investor-state dispute settlement provisions in BRTAs that grant foreign investors in Australia substantive or procedural rights greater than those enjoyed by Australian investors.

I do not dispute that view. But the Greens always leave out that little bit—it is only those bits that provide substantively greater procedural rights. That has not happened in any of these agreements. If it had, we would have seen that evidence.

I listened to Senator Ludlam earnestly worrying about how this provision could stop us dealing with fracking, and I think uranium mining, and all these other things. If you read the Korean FTA that we have only just signed, chapter 18 deals with the environment and these issues that Senator Ludlam raised. The very first article, 18.1, in that chapter says:

Recognizing the right of each Party to establish its own levels of environmental protection and environmental development priorities, and to adopt or modify accordingly its environmental laws and policies, each Party shall ensure that its laws provide for and encourage high levels of environmental protection and shall strive to continue to improve their respective levels of environmental protection, including through such environmental laws and policies.

There are no restrictions against a country acting to protect its environment under the Korean FTA or under any of our other bilateral investment agreements. The Greens have quoted from none of these ISDS agreements to prove otherwise.

Senator Whish-Wilson also raised the point about international evidence. It is true, internationally there is much more experience associated with ISDS clauses. There are, across the world, 2,400 bilateral investment treaties in place. Of those bilateral investment treaties, 90 per cent have not had a single investor claim under them for a treaty breach. Fewer than 10 per cent of these 2,400 agreements have ever been triggered, even once. I did not hear Senator Ludlam say this, but sometimes people claim that there has been a surge in ICS claims.

There has been an increase. I do not have the numbers of the increase in claims here, but the key point to make is that these increases are proportional to the amount of outward foreign capital investment in the world. I am not sure if I am allowed to use props, but there is a graph from a report I read this morning that shows, very clearly, that the number of claims—sorry, I do have the figures here—have risen to about 600 a year now we are averaging in ISDS claims. But that is directly proportional to the increase in foreign direct investment across the world. It is a very good thing that we have more foreign direct investment. It has allowed economies, particularly developing economies, to increase their growth considerably over the past 50 years. When you think about—

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Why did you leave out the US free trade agreement?

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

I will take that interjection, Senator Whish-Wilson: why did we leave out the US free trade agreement? Because we did not need it with the US. We on this side believe we should evaluate these things on a case-by-case basis. Oils ain't oils, Senator Whish-Wilson; through you Mr Deputy President. We should evaluate these things as we see fit. We do not need it with the US because both Australia and the United States have very strong protections against property rights. There was no need for it. So let us look at it on a case-by-case basis. Before I was interrupted, I was talking about foreign direct investment. In 1959, the global stock of FDI was just US$60 billion—not a lot of money at all in the context of the world economy. But today it exceeds $25 trillion. That is a massive growth, and it is a very important growth because it has allowed, particularly, countries which are poorer and which lack capital to access capital from overseas countries. And one of the reasons it has been allowed to grow is thanks to these investment treaties, because they give investors—largely in developed countries, because that is where the capital is—the protection and the rights to make sure that it is—

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

Order! Senator Fawcett on a point of order.

David Fawcett (SA, Liberal Party) Share this | Link to this | Hansard source

I rise on a point of order: standing order 197, Mr Deputy President.

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

I can say that interjections which are not actually disrupting the debate are sometimes tolerated by the chair, particularly if they facilitate the exchange of views and arguments in a debate. However, if Senator Canavan does seek the protection of the chair, I will certainly provide him with that protection.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

I am new to this, so perhaps I should. But look, I am quite enjoying it and I think that the Greens senators are enjoying it, so let us continue. I will let you know, Mr Deputy President, if my position changes in that regard.

As I was saying, these protections have been very important to facilitate that growth in investment. Prior to these protections coming into place, it was quite common for governments, particularly in developing countries, to expropriate property or to nationalise property, and to thereby take away the investments that foreign countries had made. Indeed, according to some evidence presented by the United Nations in a paper that I read this morning, in the 14 years prior to the entry into force of the first bilateral investment treaty, there were 875 government takings of foreign-investor property in 62 countries, for which there was no effective remedy. International law at the time provided very few protections for investors in those cases. It meant, of course, that there was a chilling effect on that foreign investment, and that many people would not invest.

I support foreign investment, particularly on the global scale. It is very important. And I do not understand why the Greens are, seemingly, so anti this—because, in other instances, the Greens are very cosmopolitan and very multicultural, and that is a fantastic thing. We should seek to have a world that shrinks, and becomes smaller, and in which we tighten our relationships with each other. Investment certainly does that. Trade helps to build relations; trade helps to make sure countries stay friendly with each other. But investment does it even more; when you buy something at the shop, you have a relationship with the shopkeeper, but when you invest in his business, you have a permanent relationship. We should seek to encourage that between countries. These treaties and agreements have also allowed us to move away from what was sometimes called gunboat diplomacy. That was a regrettable period in American history but, many times, the US government—in the 19th century in particular, and into the 20th century—used its military force to ensure that its investors were protected and that its trade rights were maintained. But I think we would all agree that that was not the right way to go about things. These new treaties have allowed investors—from the US, but actually more from Europe; the evidence is that European investors have been the biggest users of these clauses—protections, without the need to resort to governments offering military threats or, in the worst cases, military interventions. It is much better that we should jaw-jaw rather than war-war. Of course we are going to have disagreements through these agreements, and sometimes we might not get the best results we would like—although, as I said earlier, that has not happened to Australia yet. But it is much better that we resolve these disputes through a legal process rather than a more direct and violent one.

I also just want to go to some of the evidence in the international jurisprudence, and it goes to some of the points Senator Ludlam was making that somehow these provisions undermine the ability of governments to put in place environmental or health protections. In fact, that is not true at all when you actually look at the jurisprudence. Under the NAFTA—the North American Free Trade Agreement between Canada, the United States and Mexico, which includes an ISDS clause—there was a case brought by Chemtura, a chemical company. It brought the Canadian government to court. The investor challenged Canadian pesticide regulations, but the tribunal in this case ruled against Chemtura on all claims, and the panel expressly recognised Canada's right to make scientific and environmental regulatory decisions. There was another NAFTA case, called Methanex v United States. Again, the tribunal dismissed all of Methanex's claims of discriminatory treatment and expropriation, noting:

… as a matter of general international law, a non-discriminatory regulation for a public purpose, which is enacted in accordance with due process and, which affects … a foreign investor or investment is not deemed expropriatory and compensable unless specific commitments had been given by the regulating government to the then putative foreign investor contemplating investment that the government would refrain from such regulation.

Again, there are well-known protections both in ISDS agreements and in general trade law that allow governments to regulate for the public good.

But that is not to say that these agreements have been without effect. They are not completely timid. These agreements do offer protection, and they have in fact offered protection to Australian investors, because what is often lost here is that it is a two-way street. While these agreements do, of course, protect overseas investors in Australia, they also protect Australian investors overseas. Recently there have been two cases of Australian companies making use of ISDS clauses. In November 2011, a tribunal awarded White Industries Australia Limited, which is an Australian mining company, compensation from the Indian government for violating the India-Australia agreements. There was another case in 2011 where an Australian copper company, Tethyan Copper Company, formally commenced ISDS provisions against the government of Pakistan. In December 2012 Planet Mining, another Australian company, requested that the government of Indonesia consider a claim under a clause in that international agreement. So it is important that our investors and our companies have the protection of these agreements.

I think that property rights should be something that we try to uphold and protect. I am not necessarily surprised that the Greens do not put as high a price on the protection of property rights as other members in this chamber, but we do have international agreements that cover human rights, providing protection against torture and covering other internationally recognised rights issues. Property rights are extremely important as well, and the protection of property rights goes back right to the start of the Enlightenment and the Declaration of Independence in the United States. It is enshrined in our Constitution as well: the government must give just compensation where it acquires property. But we should make sure it is enshrined in these agreements as well, because sometimes courts can look more fondly on domestic investors than they do on foreign investors. We should seek that the same kinds of protections that we think are right and proper in our Constitution and that exist in other constitutions, such as the American government's, be similarly recognised in this agreement.

One reason I think the Greens are promoting something like this is that they do not really believe in that. They do not really believe that property rights should always and everywhere be protected, that property rights are on a par with other types of rights and that governments should not be given licence to simply take property from people without due compensation.

There is a particular issue in Queensland that has been longstanding Greens policy, and it will be detrimental to regional areas and the farming community. If the new Labor government in Queensland seeks to reintroduce tree-clearing laws into that state—as they have promised to do—I bet you they will not offer a cent of compensation to farmers. Farmers previously had the right to clear property on their land to develop it, to make it have value, and that value was embodied in the price they paid for the property. The price they paid for a property included a right to clear the trees on their land, to develop the land, to put irrigation in, to put better pastures in, to put more head of cattle on it and to make more money.

That was changed almost 15 years ago in Queensland by the former Labor government. It introduced these laws that stripped all of those rights away from farmers. Perhaps some greater protection did need to be put in place, but compensation should have been given. Compensation should be given, in this place, with the powers that we have, because sometimes these debates are presented as though governments are weak, timid and vulnerable institutions that are beholden to corporations, when that is not the truth. We are very powerful. When we use those powers to take things from people, particularly from small businesses and farmers, we should have the guts to stump up with the cash to compensate for that taking of rights.

If we in this chamber had tried to pass the kinds of laws that Queensland had, there possibly would have been a claim under section 51 of the Constitution for farmers. But the Queensland government is not bound by those provisions in our Constitution, unfortunately. In the United States they are. It is the fifth amendment, I think, where due process must be followed for the taking of property. That does bind American state governments, but it does not here in this country, unfortunately. These provisions are something that go to the heart of what we on this side of the chamber believe. Property rights should be protected; we as governments should not abuse our powers by taking from those who are weaker and more vulnerable than us.

As I said to an interjection earlier, we on this side of the chamber do not insist that all trade agreements have an ISDS clause. As was noted by Senator Whish-Wilson, in the US free trade agreement we did not put that in place. In the Korean free trade agreement we put many more additional protections than have previously existed in ISDS clauses, to ensure that governments do have the power to regulate for the general public good and for order.

There is some limitation or shortcoming in the way this bill has been drafted. As it has been drafted, it will stop us from entering into all agreements that have an ISDS clause, even if that agreement exempted us from those clauses. There could clearly be a case—even in the TPP—where we would be exempted from some obligations. That would fall foul of this particular bill, if it were passed. So I do not think it is drafted in a way that we should pass it in this chamber. It would unreasonably restrict the role of the executive government in negotiating and signing agreements that promote trade for Australians and protect their investment rights.

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I rise today to say that this Australian parliament should ban investor-state dispute resolution clauses in any agreement that Australia signs. It is as pure and simple as that.

I find it extraordinary that a government that has made an art form out of talking about Operation Sovereign Borders—suggesting to the Australian community that it is somehow protecting Australia's sovereignty from refugees—would, in fact, be prepared to negotiate away our own national sovereignty. This is the agenda to say that democratically elected parliaments are subject to the demands of corporations; not only multinational corporations but also corporations based in any of the member states of any agreement which is signed. In the case of the Trans-Pacific Partnership that is Australia, the United States, Japan, New Zealand, Canada, Mexico, Peru, Chile, Singapore, Brunei, Malaysia and Vietnam.

The big point here is this: we have a parliament to make the laws that govern this country in the public interest. That is fundamentally what parliament is about. That is why we are elected to this place. And what is going on at the moment is a negotiation—in secret—of a text of a trade agreement that the Australian community cannot see. We have a government saying: 'Oh, this is normal. We do not share this with people. And actually, the parliament will get to look at it'—yes; after it has been signed off by cabinet, and the parliament then only has the right to either reject the entire treaty or not. The fact of the matter is, this government—Prime Minister Abbott, and the minister, Mr Robb—are negotiating away Australia's sovereignty, and placing it in the hands—particularly in this case—of corporations based in the United States. The shocking thing here is that the United States congress has access to the text. But we do not—we in this parliament do not. But if you are a member of congress in the United States, you can get access to the text—yes, you might have to sign a confidentiality agreement, but you get to see what it is that the American government is signing up to. But we do not. We have no idea. Nobody in Australia— nobody on the street, none of the stakeholders, none of us—knows exactly what is being signed up to. Secrecy, and a lack of transparency really matter in cases like the Trans-Pacific Partnership, and in investor-state dispute resolution.

Why am I saying that it is an assault on Australia's sovereignty, and an assault on decisions of the parliament and the judiciary? It is not just parliamentarians like the Greens who are objecting to this; the judiciary is worried as well—because the chilling effect of this is that corporations can sue a government if a government moves to take legislative action which undermines their profits. The classic case that Australians may be familiar with is the Phillip Morris case with the cigarette companies. It is already happening. Phillip Morris is suing Australia under an ISDS provision in a Hong Kong-Australia investment agreement. They have also sued Uruguay for increasing the size of health warnings on cigarette packets. A legal adviser to Uruguay said:

They are bullying us because we are small. This is like David and Goliath. But we will fight because it is our right and duty as a government to protect our citizens' health.

The New Zealand health minister has delayed the introduction of plain packaging in New Zealand because of the fear of being targeted with similar litigation. This is what is known as 'regulatory chill', where governments are afraid to legislate because it may lead to them being sued by a corporation. There are plenty of examples you can think of in Australia where that might happen. You might have it with companies who are wanting to engage in fracking, for example. If Australia brings in a ban, you can see where the companies—if they had already started their operations—would be suing the government—that is, suing the government for bringing in a regulation that protects public health. It is the same in terms of GMOs. We know Monsanto would love to be able to sue Australia because Tasmania has a GMO moratorium. We make sure we do not have GMOs in Tasmania. It is part of our commitment to the environment, but it is also part of our commitment to the clean, green and clever brand of Tasmania. Monsanto would love to sue on that occasion, and it has happened in other jurisdictions.

In the wake of the Fukushima disaster there was a groundswell of opposition to nuclear power in Germany. The government responded to this powerful movement by announcing a shutdown of the nuclear power industry. Soon after, Vattenfall—a Swedish utility that operates two nuclear plants in Germany—demanded compensation of 3.7 billion euros under the ISDS clause of a treaty on energy investments. In responding to the will of the people after what they saw after Fukushima, the government tried to act in the best interests of the health of the German people. And in came the corporation to say, 'You are undermining our profits out of nuclear power and therefore we want compensation.'

Oil and gas giant Lone Pine is suing the Canadian government for $250 million over Quebec's moratorium on fracking. That is enabled by the ISDS clauses in the North American Free Trade Agreement. Lone Pine alleges that the fracking moratorium reduces 'the expectation of a stable business and political environment'. Never mind the instability that will arise from fracking, including water insecurity, loss of farmland and—ultimately—global warming.

We are also seeing the NGOs coming out. The Sierra Club, in relation to this issue with Canada and Lone Pine, has said:

If a government is not even allowed to take a time out to study the impact—

of fracking—

without having to compensate a corporation, it puts a tremendous chill on a governments' ability to regulate in the public interest,

You also have a situation with Australian company OceanaGold in El Salvador. The Australian mining company is currently suing El Salvador for $301 million—the equivalent of half the education budget of a poor country, like El Salvador—because it refused to issue them with a gold-mining licence.

The situation goes back to 2004 when the company applied for a mining permit and assured the government that its work would be environmentally friendly and would provide jobs for local people. In the interim, the damages of mining proliferated in El Salvador. Ninety per cent of the country's surface water became contaminated. There was acid mine drainage, which has killed aquatic life and destroyed water quality in the region, and high rates of disease linked to arsenic poisoning. Currently, just two per cent of El Salvador's water is determined by the government to be of good quality. The El Salvador government said:

… the original application to mine did not meet environmental safety standards and that the proposed mine poses risks to the country’s already limited water supplies. OceanaGold denies the risks, even though—

everybody knows—

gold mining is notorious for polluting waterways with arsenic mercury and other toxic metals.

As a result, the government failed to approve the proposal and instituted a moratorium on mining permits, as you would expect they would do in the public interest.

We are now seeing, under the ISDS clauses of the North American Free Trade Agreement, the company go after the El Salvador government. If the company succeeds, this will significantly reduce the funds available for health care and education. Even if Pacific Rim's claims fail—as many expect—this lawsuit has cost El Salvador almost $13,000,000 to date, which amounts to nearly its entire environment and natural resources spending in 2013.

That is going on already around the world and that is precisely what Australia is lining up for. I wonder how much it will cost the Australian government to defend the case against Philip Morris? It would be very interesting for the government to tell us how many precious taxpayer dollars have gone into taking it up to Philip Morris in the courts. Philip Morris is suing us for daring to legislate in the public interest about plain packaging. It would be good to hear from the government, in the course of this debate, the cost to the public purse.

I also want to point out that the Labor Party when it was in government wanted to sign up to the free trade agreement with Korea. But I am pleased to say, the minister of the day, Craig Emerson, came out and said:

We considered it long and hard, and we had to stare into the abyss of having to say, 'We can't conclude the agreement with Korea.' As a matter of principle and in keeping with the commitments that we made, we said to Korea, 'No, we cannot do it.'

He went on to say that they opposed it in the Korea FTA because:

… if we had agreed with it with Korea, it would be inevitable that we would have to agree with it within the Trans Pacific Partnership and other trade agreements. It was obvious to us, if we'd said yes to Korea, how do you say no to the United States?

The Labor government knew at the time that if they signed up to the trade deal with Korea with the ISDS in place it would be rolled over into the Trans-Pacific Partnership Agreement and that is precisely what is happening. It is disgraceful that now that Labor is in opposition they go along with the government's signing up to the free trade agreement with Korea with that investor-state dispute resolution clause in place.

That means Labor and the government in Australia are selling out Australia's sovereignty. They are doing it in secret; there is no text for anyone to see. What is even worse than the U.S. Congress having access to the text while we do not, is that they are asking us to sign off on the text here in Australia. They are asking us to sign it off in this parliament before it is concluded in the US; and the US reserves the right to change it if it does not suit US companies, the US Congress or their consultation process. So, if ever Australia were selling out our sovereignty to US and to corporations, it is under this agreement.

This is the agenda of the corporate world. This is the agenda about getting rid of regulation on a global scale to maximise their absolute destruction of the planet at the lowest possible price—

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

You cannot believe this rubbish!

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

and at the expense of local people, jobs, wages, conditions—the whole lot. That is exactly what you are going to see in investor-state dispute resolution and it is why the Europeans—

Senator Ian Macdonald interjecting—

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Order!

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

are backing off this at a great rate. The European parliament has had a letter from 100 legal and other experts in the field saying, 'Back off this in Europe. It is a bad idea.' They have had to put it on hold and they have had to start looking at what it actually means in the European context to sign up to agreements with investor-state dispute resolution clauses in them.

But think about it: if you have a multinational corporation that is threatening a country, why would a parliament then move to legislate for a ban on fracking or to stop environmental destruction if they knew they were going to incur the wrath of the corporation suing them and the legal costs associated with defending it? The whole point of a parliament and sovereignty is for the parliament to be able to be the ultimate decision makers—

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

This coming from the Greens!

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Order!

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

and for the courts to be the ultimate decision makers in terms of the legal framework, the laws of the country and how the laws of the country are implemented. Once you devolve that decision making power to corporations you might as well give up as a parliament and as a government—and that is precisely what the Abbott government is doing.

The Labor Party knows it. They had this experience with the Korean free trade deal and that is why, to their credit, they did not sign up. They knew what investor-state dispute resolution meant. Tragically, they have now gone onto the same bandwagon as the government. But the people of Australia do not like it. The people of Australia do not like the idea that once again we have a Liberal government that pretends to protect the sovereignty of Australia selling out to the United States and, in particular, selling out to multinational corporations—

A government senator interjecting—

because that is the consequence of what is going on. I have cited the examples—the Philip Morris case, the Canadian case of Lone Pine, the German antinuclear case and the El Salvadorian case of environmental regulation. The trouble with some senators on the other side is that they prefer ignorance and ideology to get in the way of evidence. The evidence I have presented stands alone.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

Talk about ignorance and ideology!

The ACTING DEPUTY PRESIDENT : Senator Macdonald, in four minutes and six seconds you will get your turn. Please allow Senator Milne to speak.

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I can tell you that the Chief Justice of the High Court of Australia, Justice Robert French, has raised his concerns that ISDS is effectively establishing a parallel legal system where Australian judges have no voice. Senator Macdonald thinks, obviously, that he knows better than the Chief Justice of the High Court of Australia, Justice Robert French. But I think, Mr Acting Deputy President, that when you have the Chief Justice saying that what you are doing is selling out the sovereignty of the Australian parliament and the Australian legal system, you should start thinking about that. When the Chief Justice is saying that the ISDS is setting up a parallel legal system where Australian judges have no voice, that should be of major concern to Australians. People are already worried that this government is governing for the big end of town. We are seeing it—absolutely—when it comes to their refusal to crack down on tax avoidance; in the huff and puff of the Treasurer before the G20—all about tax avoidance—until we had to ask for a delay in Australia actually engaging in the exchange of information around the world that would lead to a crackdown of tax avoidance. We saw it in MYEFO before Christmas: the tax avoidance measures that were in that document were removed. We are seeing it left, right and centre.

The two greatest threats to humanity and to the planet are the growing inequality around the world in the accumulation of wealth, and global warming. Those two things together are driving massive social unrest and ecological destruction. And the people driving it are the corporate world—the one per cent who own the vast majority of the Earth's resources now, and their wealth, want to secure a regulatory environment which is lowest common denominator, and they want to use these investor-state dispute resolution clauses to do it. This is a dangerous assault on the integrity and capacity of the Australian parliament to govern in the best interests of the Australian people, for our wellbeing and our health. It is being done in secret, handing over to the United States the right to actually change the text—after the Australian parliament has signed off on it. And we will be subject to it after that. What sort of government acts as a doormat to that kind of agreement? I can tell you which sort of government: it is the Abbott government. It is the very people who pretend they are interested in Operation Sovereign Borders, while actually undermining the sovereignty of our nation in a very frightening way.

We only have to look at what is going on with the power of the corporates. We have to take our democracy back, and one way of taking our democracy back is banning investor-state dispute resolution clauses in any agreement that Australia signs. That is the way we take our democracy back, that is the way we restore the sovereignty of our parliament and our legal system, and that is the way we prevent the multinational corporations of the planet from overseeing the best interests of Australian and the environment. And if we do not, we are going to see billions of taxpayers' dollars over the years being set aside in legal cases. And the culprits responsible are sitting in this parliament, pretending to be a responsible government as we speak.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

Anyone who is seriously following this debate, and who heard Senator Canavan a little while ago, would appreciate that nothing the Greens have said—nothing that Senator Milne or Senator Ludlam have said—stands up to a factual assessment. A lot of people who I know follow Senator Ludlam's technical savvy in these areas; you know, he gets on Twitter and Facebook and YouTube, with all the buzzwords—

Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

I am on it now!

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

He is on it right now! But can I just say to you people, please carefully look at anything Senator Ludlam or Senator Milne will tell you, because history shows most everything of what they say is not supported by fact; and it is, in fact, simply lies. It is easy to pick the buzzwords. It is easy to pick the prejudices—these big US corporate giants—

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Senator Ludlam on a point of order.

Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

Mr Acting Deputy President, I rise on a point of order. Senator Macdonald, you have been here for decades, if not hundreds of years. You know very well that it is unparliamentary to accuse other senators in this place or the other of lying. So I ask you to withdraw that and then carry on with your strange rant.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I will let that one go. It was part of a wide-ranging debate, but I would urge caution, Senator Macdonald.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

'Strange rant'—that is okay. This is the thing with the Greens political party, hypocrisy knows no bounds. Here is a party talking about 'surrendering Australia's sovereignty'. Which party would have the one-world government, to have Australia sign up and be bound by every single international treaty brought on by anyone around the globe?

You only have to look at the facts of these issues to realise that most everything you hear from people like Senator Ludlam and Senator Milne simply are not supported by truth and accuracy. Sure, pick all the prejudices: fracking, big end of town, nuclear—and the US corporate predators. Never mind any other corporate predators. US corporate predators are the real ones.

Senator Cameron made a very measured address. He clearly indicated the facts. It is obvious that no-one from the Greens political party has read the agreements that have been entered into so far. Senator Canavan quite rightly assisted those Greens members who were interested in truth and accuracy—and I am not sure there are many—on what section 18(1) of the Korean free trade agreement said. He read it out. I could repeat it, but I will not take the time of the Senate.

Australian governments, not just this government but previous governments as well, have entered into a number of interstate dispute-settlement arrangements over a number of years. In free trade and bilateral agreements we already have interstate dispute-settlement provisions in Investment Protection and Promotion Agreements. These include countries such as Singapore, Thailand, Chile, 10 ASEAN countries and New Zealand. We also have agreements with Argentina, China and the Czech Republic. I have not got to the 'big predator' US government yet that the Greens like to talk about. I am sure that is here.

We have entered into these sorts of agreements with all these countries: Argentina, China, the Czech Republic, Egypt, Hong Kong, Hungary, India, Indonesia, Laos, Lithuania, Mexico, Pakistan, Papua New Guinea, Peru, the Philippines, Poland, Romania, Sri Lanka, Turkey, Uruguay and Vietnam, just to name some of them.

I will try to put a little truth and accuracy into this debate. I will indicate to the Senate the types of obligations covered by ISDS. One of them is that foreigners and locals should be given a similar treatment. How bad is that? It applies to Australians. Do we have different rules for people from other countries? Talk about xenophobia in the Greens political party! It seems to know no bounds. These agreements say that foreigners from one country should be given similar treatment to foreigners from another country—so the Chinese and their trade agreements with Australia will be treated the same as the Americans; they will be treated the same as the Hungarians; they will be treated the same as the South Africans. What sort of a problem does anyone see in that? These agreements also limit the circumstances under which expropriation can take place, and they require provision of adequate compensation. Under the Australian Constitution, if the Australian government expropriates property for good reason, it is required to pay compensation. But the Greens do not think the same should apply to other countries who have property rights in Australia which are expropriated by the federal government. It is okay to pay Australians compensation, because the government is required to under our constitution, but forget the foreigners! We will just take their property and we will not allow for any compensation. These obligations also provide for non-discriminatory treatment and for compensation in the case of armed conflict or civil strife, in any country which Australia has these arrangements with.

While the Greens political party think that this is not appropriate, a company from one country that invests in a different country should be able to freely deal with profits they make as a result of their investment. Otherwise they would not be making the investment. Most countries around the world are seeking investment in their own countries—to help their countries—but are expecting that those who invest will make profits, and will be able to take those profits home as they intended. In fact, the Foreign Affairs, Defence and Trade Committee yesterday had a very interesting roundtable meeting with all of the ambassadors from the Arab countries in the world. It was a great get-together, talking about two-way trade between our countries. I asked all the ambassadors to quickly run through and indicate which of their commodities or services they would like to sell more of to Australia. Some of the ambassadors responded as you would expect—more clothing, more chemicals, more olive oil—but a lot of them said, 'we want Australia to invest in our countries, and to bring Australian expertise into our countries. We know that is good for Australia; they will make profits and help employ some Australians, but we also want that because it will help our countries to develop.' And yet the Greens, by not allowing these ISDS provisions, would seek to make it difficult for Australians to take action against these countries if these countries introduced laws that expropriated Australian investments in their country without compensation. That is what this is all about.

To anyone who is following this debate: do not take anything the Greens say as accurate, but please look into it and please look at history. You will find that almost everything the Greens political party will stir you up about turns out to be absolutely incorrect, but time does not permit me to go through all of those issues.

It is hypocrisy—sheer hypocrisy—for the Greens political party to say that we are surrendering Australia's sovereignty to international corporate giants, when everything the Greens do in this parliament is all about international treaties, and about how Australia should subject itself to the dictates of all of these international bodies; the United Nations and other bodies. They do not want Australia to have a view on uranium, or climate change. They do not want Australians who, by majority, have a different view to some of the members of the international community views on climate change. They want Australia just to accept, willy-nilly, the views of these international bodies without allowing the Australian people to have their say.

The Australian people clearly share my view on the irrational accusations of the Greens about climate change. We all accept the climate is changing. I often say that once upon a time the world was covered in ice and snow, and clearly over the aeons that has changed. Once upon a time the centre of Australia was a rainforest. Clearly that has changed. Clearly climate changes. But there is no accepted evidence at the moment that man's emissions of carbon have been responsible for it. There is no evidence that there has been global warming for 20 years. In fact, the actual scientific evidence suggests otherwise. But the Greens would have Australia's sovereignty—

Senator Siewert interjecting—

That is true. I am sorry. I can give you 50 scientists who say that.

Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

What scientists?

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

See, because they are not—

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Senator Macdonald, please address your comments through the chair.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

Thank you for that unbiased ruling, Mr Acting Deputy President. I am being attacked by members of the Greens political party. You do not pull them up.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Senator Macdonald, take your seat. Take your seat, Senator Macdonald. All I asked you was to address your comments through the chair, which you know is accepted protocol.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

If you look at the record, you will find that all of my comments are through the chair, and even my response to interjections was through the chair. Please, Mr Acting Deputy President, do your job.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Senator Macdonald, all I asked you was that you address your comments through the chair, which you know is accepted protocol. You were pointing and yelling at Senator Siewert. You can point and yell at me, but please address your comments through the chair.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

I would never point or yell at the chair.

Lisa Singh (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Attorney General) Share this | Link to this | Hansard source

I am on my feet, Mr Acting Deputy President.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Sorry, Senator Macdonald. Please take your seat. Senator Singh.

Lisa Singh (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Attorney General) Share this | Link to this | Hansard source

I was on my feet before you.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

I was on my feet.

Lisa Singh (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Attorney General) Share this | Link to this | Hansard source

No, I was on my feet before you.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Senator Macdonald, please take your seat. Senator Singh.

Lisa Singh (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Attorney General) Share this | Link to this | Hansard source

Mr Acting Deputy President, on a point of order, Senator Macdonald is reflecting on the chair, and I ask you to rule accordingly.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

As I was just saying, Senator Macdonald, please just address your comments through the chair. You understand the protocols. Let us continue the debate.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

Mr Acting Deputy President, I do not need your protection against the interjections of the likes of Senator Siewert, but if you are making those rulings please be consistent. I will continue on the line that Senator Siewert does not like. Because they are not scientists that she and her group of funny people think are good scientists, they are all to be ignored. You only listen to those who repeat your mantra, Senator Siewert. There are credible scientists around the world—

Senator Siewert interjecting—

You laugh, but then I laugh at your ridiculous comments, and so I accept that. But, Mr Acting Deputy President, perhaps you could help me—I address this through the chair—by stopping the consistent interjections I get from the Greens political party.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Senator Macdonald, I will ask Senator Siewert to cease the interjections and remind everyone in the chamber that interjections are disorderly.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

Thank you, Mr Acting Deputy President.

Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

Mr Acting Deputy President, on a point of order, I do accept your ruling; however, Senator Macdonald was speaking across the chamber directly to me, so I responded. I apologise to the chamber, but, if you could ask him therefore not to address his comments directly to me across the chamber, that means I will not interject and respond.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Thank you, Senator Siewert. I will remind Senator Macdonald: please address your comments through the chair.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

The Australian government has done an absolutely fantastic job in relation to trade. It is a bit like debt, you know: people talk about trade, and they think, 'Trade's something governments do; it doesn't really impact upon us.' It is a bit like that with debt: 'Debt's just something the government will fix up; it doesn't really affect us.' Of course, what we really need is for Australians to understand that debt—and the $7 billion of debt that the Labor Party ran up—does in fact impact upon them very, very seriously. As with people's own household budget, when you borrow from a lender, some day you have to pay it back. And until you pay it back, you have to pay interest on it. But people say, 'That's the government.' Well, sorry, but the government does not have any money. The government only uses the money of taxpayers. So, it is the taxpayers who will have to pay off Labor's debt, which will approach $700 billion. And it is the taxpayers who will have to pay the $30 million a day that we are paying in interest on the Labor Party's debt—the Labor Party supported by the Greens political party. Imagine how many schools, imagine how many hospitals we could build every day with the amount we are now paying to foreign lenders on the debt run up by the Labor-Greens government.

And it is the same with trade. People think, 'Oh, trade—that's something governments do; that's good, but it doesn't really impact upon us.' Sorry: trade is very important to Australia. We are a country that is blessed with natural resources. We are blessed with fine educational institutions. We are blessed with a very energetic and innovative population. But we need to trade to be able to use those assets we have, and that means more jobs for Australians. And these free trade agreements that Andrew Robb has brilliantly concluded, in a very short period of time, mean jobs and wealth for all Australians.

I know Senator Milne is talking about how the corporate giants are ripping off all the poor people in the world. I would just remind Senator Milne that she is part of the one per cent of the world population earning a very, very high income. Yet that never seems to worry Senator Milne. It is okay for her to blame the US corporate giants and the wealthy people everywhere around the world, but I would just remind people that Senator Milne is one of those who is in the one per cent of highest-income earners in the world. And we never seem to get that recognition when we hear Senator Milne viciously attacking corporate investors into our country and indeed other countries.

Trade is important. The free trade agreements have considerably assisted Australians in their lifestyle, in their way of living and, more importantly, in their ability to be fully employed. Those free trade agreements and other trade agreements we have made with people in many instances do have these investor-state dispute settlement arrangements. They have been in place for ages. The Labor Party has entered into agreements where those conditions do apply. They apply for a reason, and that is that they are fair and they treat people equally. It does mean to say that if Australian companies invest somewhere else then those other countries will not confiscate Australian assets without the sort of compensation they would apply to their own nationals.

The Greens political party would have you believe that this means that corporations from around the world—not just America, although they are the only ones you hear about from the Greens—can dictate to Australia how Australia should legislate internally. The agreements we enter into do actually provide that matters relating to health and the environment—and Senator Canavan went into this in some detail—are not impacted by these investor-state dispute settlement arrangements. So, Australia is free to provide whatever it believes is the right legislation in relation to many issues that are clearly set out in these agreements. What they do say, though, is that if the Australian government, for all the right reasons, does confiscate property then the people whose property is confiscated, no matter which country they come from, will be treated the same way as Australian companies and Australian individuals. That is, if, for the right reasons, the government of the day confiscates property, people will be properly compensated for that confiscation. Now, what is wrong with that? I ask the Greens political party: what is wrong with that? Countries that invest in Australia and whose property is confiscated would be treated the same as Australians.

Unfortunately time has escaped me. I was going to raise the stupidity of the ban by the Labor Party and the Greens political on live cattle exports to Indonesia. That is a very good case in point, and, unfortunately, as I said, time is not going to allow me to elaborate on that. But Indonesian companies who had invested in Australia on the basis of a trade arrangement in live cattle that had been in place for decades and whose property was made worthless by a stupid decision of an Australian government should have been in some way compensated for that. But unfortunately time is not going to allow me to continue in that vein—perhaps some other time—but I would urge the Senate to reject this bill. (Time expired)

Penny Wright (SA, Australian Greens) Share this | Link to this | Hansard source

I rise to speak in support of this Greens legislation: the Trade and Foreign Investment (Protecting the Public Interest) Bill 2014. The purpose of this bill is to prevent the Commonwealth from entering into an agreement with one or more foreign countries that includes particular mechanisms called investor-state dispute settlement clauses, or ISDS clauses. The inclusion of these mechanisms is one of the most insidious trends that we are seeing in modern trade deals.

I applaud Senator Whish-Wilson's great work in bringing this bill forward and encouraging debate on what has the potential not only to shape the kind of world that we bequeath to our kids and our grandkids into the future but to fundamentally undermine the rule of law and democracy itself. They are high claims to make. I am sorry that Senator Macdonald is leaving the chamber, because he invited me to answer some questions that he posed, and he obviously is not particularly interested in hearing those answers. At one point, he scoffed at the idea that Chief Justice Robert French of the High Court of Australia commented with great interest on the issues that are posed by these ISDS clauses and free trade agreements. Indeed, Chief Justice French and many others have raised significant concerns, and I will come to those in the course of my contribution today.

But let's start by asking why these ISDS clauses are so troubling. It is because these are mechanisms by which private investors—corporations who are based outside a sovereign nation with no loyalty to, interest in or concern for the citizens of that nation—can take their own action against the sovereign government of the nation and use the clauses to sue governments for huge amounts of compensation if they can show that a government policy or a change in policy has directly affected their profitability or their investment. In so doing, they can exert a huge influence and control on the laws and policies of nations irrespective of the will of the democratically elected parliaments in those nations.

This Greens bill is designed to prevent the Australian government from entering into agreements that include these ISDS clauses, to prevent corporations outside Australia from being able to dictate to Australian governments, effectively, the kinds of laws they can and cannot make and—by extension, given that the laws and policies and governments shape the world that we live in—the kind of Australian society that we have. It is interesting, and Senator Milne made this point as well, that we hear a lot about border protection from this government but when it comes to protecting our legal borders—our legal sovereignty: the right of democratically elected governments in Australia to make laws on behalf of all of us and have those upheld by our courts—this government is a bit silent. In fact, they are highly secretive. Right now we have 12 governments, including those of Australia, the US, Japan, Canada and New Zealand, negotiating this far-reaching trade deal, the Trans-Pacific Partnership Agreement. Aspects of the Trans-Pacific Partnership Agreement, the TPPA, pushed by global corporate interests are seeking to radically dispose of government regulation in the name of enhanced global competition.

We have been invited by Senator Canavan to give evidence of our concerns, but the problem is that these negotiations are conducted totally in secret. So my invitation to Senator Canavan would be that if we have nothing to fear—if, in fact, these concerns that are being raised not only by the Australian Greens but throughout Australian society and internationally are not founded—then reassure us: show us the terms of the negotiations that are happening and we can all go home. In fact, this is a situation where these negotiations are in secret and, for the first time ever in trade deals, they will include discussions to get broad agreement to remove what are called unfair advantages from government state-owned enterprises and their impacts on commercial business.

One hallmark of the way these deals are negotiated is that the Australian public has no right to know what is being negotiated away in our name until the deal is done and dusted, and then it is presented to the sovereign Parliament of Australia with the only option being to vote in favour or against; there is no possibility of changing it; the deal has already been done. We see in the current negotiations for the TPPA, on the back of global corporate interests and pressure, the US government wanting to include a proposal which would allow foreign companies to sue our government and the governments under the agreement for damages if they were to adopt laws or policies that could harm the investment of these global interests. So even if they are laws and policies made in good faith on behalf of the national public interest—laws which may protect public health or the environment—there would be the capacity for outside corporations to challenge those laws and seek large amounts of compensation. That has a chilling effect on the capacity and the willingness of sovereign governments to actually govern in good faith in the interests of the national public. As my colleague Senator Whish-Wilson has already said clearly, what we have set up in these kinds of modern trade deals is a parallel system of governance which gives corporations the right and ability to impinge directly upon our ability as parliamentarians to enact legislation in the public interest—and, in the end, isn't that what we are elected to do?

These ISDS clauses have excited huge concern both nationally and internationally. Indeed, the issue has received serious consideration from many, including High Court Chief Justice Robert French, who is the most eminent judge in Australia. Chief Justice French addressed the Supreme and Federal Courts Judges' Conference in Darwin last year. He provided a very thoughtful paper, and I commend it to those who are interested in learning more about the nature and implications of these ISDS clauses. Senator Macdonald expressed disbelief that Chief Justice French may have been commenting on these issues, so I will pay him the courtesy of forwarding a copy of the paper to him, and I hope that Senator Macdonald will read that.

Chief Justice French focuses on the tensions that can exist between these ISDS mechanisms and the legitimate functions of the legislative, executive and judicial branches of governments. With respect, who would be in a better position to consider these issues in a scholarly way? He sets out the current landscape and, importantly, the implications for the rule of law in Australia. Where there is dispute about the effect of government policy or lawmaking on corporate interests under these agreements, there is a mechanism for that dispute to then go to a system of arbitration, and there have been a great number of concerns about the conduct of the arbitration bodies as they have operated previously when considering disputes under these clauses. So, effectively, if there is government policy or lawmaking and even, indeed, decisions of courts within a sovereign jurisdiction, if a third party outside that sovereign nation wants to dispute the decision, law or policy, they can then take these to an arbitration body.

Chief Justice French in his paper refers to a briefing paper prepared by the European Parliamentary Research Service in January 2014 which describes the concerns raised about the vague formulation of major treaty provisions which leave a wide range of interpretations open to the arbitrators. There is a vagueness and uncertainty in scope and application, which is always a problem in relation to the law. There are also loopholes in these agreements, which can lead to abuses such as nationality shopping by companies, which then create subsidiaries abroad specifically to take advantage of the agreements. Indeed, that is what we have seen in the Philip Morris tobacco case that has been referred to by many of the people making a contribution to this debate.

As for the conduct of the arbitration panels themselves, particular and worrying concerns have been raised. As Chief Justice French states in his paper,

Arbitral tribunals set up under ISDS provisions are not courts. Nor are they required to act like courts. Yet their decisions may include awards which significantly impact on national economies and on regulatory systems within nation states. Questions have been raised about the consistency2, openness and impartiality of decisions made in ISDS arbitrations.

The briefing paper from the EPRS sets out some specific issues that have been raised:

and I guess there are no surprises there—

(95%) and from Europe and North America;

so sometimes they are on one side of the bench and sometimes they are on the other—

So there is a little bit of a variation on the no win, no fee or, 'We'll fund it and we'll get a cut of the win,' which is always a real concern in terms of corrupting processes. There is also:

It is important to understand that this is not just a vague, theoretical concern that we are dealing with here. This is a live issue. There have already been many cases on foot. Last year the UN Conference on Trade and Development published its annual review of ISDS cases. Fifty-even new cases—these are cases brought by outside parties, by corporations, against governments—were commenced in 2013. That was just below the number in 2012, which was a record year with 62 cases. Most of the claims were brought against nation-states by investors from developed countries—again, no surprises there—and mainly by investors from the European Union and the United States.

And what sort of cases were being brought by these corporate interests? They involved challenges to a range of governmental measures, including measures relating to renewable energy. Why doesn't that surprise me? And who would be bringing those kinds of cases? There were measures allegedly affecting expropriation of assets, revocation of licences and permits, regulation of energy tariffs—energy into the future and the profits that are to be made there is a big one, isn't it—wrongful criminal prosecutions, land zoning decisions, invalidation of patents and sovereign bonds legislations.

As I said, many would be aware of the Philip Morris case where the Australian High Court upheld the validity of legislation made by the Australian parliament to introduce plain packaging for tobacco products. The challenge was brought by a company supported by Philip Morris Ltd to the Australian High Court, but the legislation was upheld. Four months before commencing the action in the High Court, Philip Morris Asia Ltd moved to acquire an interest in Philip Morris Australia so that it then had an interest in this subsidiary. I quote from the Chief Justice French's paper:

That acquisition is said to have reflected a tactic used by private investors seeking to take advantage of bilateral investment treaties and is known as either 'nationality planning' or 'treaty shopping'. It appears to have been related to the existence of a bilateral investment treaty between Hong Kong and Australia.

That was a treaty from 1993 which included an ISDS clause. On the basis of that clause Philip Morris is challenging the Australian government for compensation on the basis of the plain packaging laws. We will be interested in seeing what occurs there.

The Australian Greens are significantly concerned that these sorts of clauses and the actions they allow corporations to take against the Australian government and state governments have the potential to shape the kind of world we are going to be leaving to our kids and grandkids. To bring that home and illustrate why I am concerned I am going to tell you about a visit I had last Sunday when I travelled to an area near Mount Gambier in the south-east of South Australia. I attended a celebration there which was a declaration by a small land area near the little town of Mil-Lel. There was a declaration by the residents of that area of their roads and their region being gas field free. Currently there are two exploratory drilling wells from Beach Energy in that area looking for the viability of shale and conventional gas mining, and there is increasing concern among the residents in that area about the risks associated with unconventional gas mining and fracking. There are real issues in that area, which is a rich area of agriculture, wine-growing, cropping and tourism. Also there is a very limited water supply in that area. There is a great deal of concern by the residents that unconventional gas mining will actually destroy the viability of the population, not just the economic viability, but in fact their ability to live there in a healthy way.

I went there and I was absolutely delighted to see proud citizens walking up and handing to the mayor of the District Council of Grant their scrolls—street by street, road by road—and saying, 'We do not accept that there will be unconventional gas mining in our area. We are saying that we are putting faith in the water and food supplies that we need to protect our kids and our grandkids.' When I saw that I felt that there was a strong vote of confidence in what is a real democracy, which is requiring decision-makers to make decisions that are in the interests of all people, not just in the interests of those who have power and influence and who are only interested in making short-term profits.

It is very clear that the ISDS clauses in these free trade agreements, and which will potentially be in the Pacific trade agreement, have the potential to stop our governments from legislating democratically in response to community concerns about environmental issues like mining for conventional gas. There are clear precedents for this kind of action by foreign corporations against governments when they are making law and policy that affects, for instance, energy—and that is what we are talking about here. We are talking about moving away from reliance on fossil fuels to having other sources of clean green energy like renewable energy, like solar and wind and so on.

There is an example in Quebec at the moment where, under the 1994 North American Free Trade Agreement between the US, Canada and Mexico, there was an ISDS clause. On the basis of that clause Lone Pine Resources, an energy company, is currently suing the government of Quebec for $250 million because it had the temerity to suspend shale gas mining while awaiting the outcome of an environmental study into the dangers of that mining. The suspension was brought about because of pressure from the community to examine the health and environmental impacts of that mining. The government response to the community pressure was democracy in action, and we have a large corporation currently suing the Quebec government to chill that decision in the sum of $250 million.

So in the south-east we have, at the moment, an inquiry from the South Australian state parliament into fracking in that area which was initiated by my Greens colleague, the leader of the Australian Greens in the South Australian parliament Mark Parnell MLC. What happens if there is a decision by the state government in responding to the findings of that inquiry, hypothetically speaking, that they were to decide that there should be a moratorium on fracking in the south-east? If we are subject to these sort of ISDS clauses in agreements, which the Australian government has entered into, there is every possibility that an organisation could then take action against the state government for compensation to prevent that sort of decision being made.

We are at a point in history where it is absolutely vital that people's perception that governments are only governing for the rich, the influential and the powerful is changed. There is increasing disillusionment, and I know that everybody in this chamber will be aware of it. When you go and talk to voters, people do not have faith that we are actually fulfilling the trust for which we have been elected, and that is to govern in the interests of all. This is a point in history where we must defend our democracy, and that has to start from the grassroots up. It has to start with respect for the people and for the national interest. Australian governments voluntarily surrendering sovereignty over the policy and the law that we make in this parliament is not only foolish and irresponsible but highly dangerous for the future health and welfare of this nation. But, fundamentally, I believe it is highly dangerous to this nation in being able to remain a viable democracy where our populace has faith in the decisions that we are making. If we lose that I do not know what we will have left. I urge the Senate to support the bill. (Time expired)

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

I rise to explain to the chamber and to the wider community why I oppose the Trade and Foreign Investment (Protecting the Public Interest) Bill of 2014. I read from the explanatory memorandum as supplied by our colleague Senator Whish-Wilson:

The purpose of this Bill is to prevent the Commonwealth from entering into an agreement with one or one more foreign countries that includes investor-state dispute settlement provisions.

Now, I have to say at the outset that I have a lot of respect for Senator Whish-Wilson. He was well educated at Guildford Grammar School, as I understand, in Western Australia. He studied at university in Western Australia, and he has a good, sound understanding of economics and commerce. He has worked in the stock exchanges, as I understand, in Western Australia, in Hong Kong, in New York and in Sydney. So, Senator Whish-Wilson has a very, very good understanding of the world of commerce and particularly the world of international trade.

Senator Whish-Wilson also understands that, in a country that has the land mass of continental USA and the population of New York City, the high level of per capita income, wealth and socioeconomics in this country, indeed, is due to our exporting capacity. We are not like America; we cannot consume the majority of what we produce. We are not like China, which, of course, also can consume. We must rely on exports, we must rely on the inflow of capital, we must rely on the rule of law, and we must, of course, rely on being important players on the world stage. I say again, that section 3 of the explanatory memorandum sets out that the intention of the bill is to prevent the Commonwealth from entering into agreements with foreign countries that include investor-state dispute settlement clauses. How harsh would this be for our little country of 23 million people if we were denied access to the export markets of the world upon which we have relied for so long, which we will need to rely on in the future to sustain the economic wealth and wellbeing of all of our citizens and, indeed, to improve the wellbeing and the socioeconomic conditions of those in our neighbouring and trading regions—Asia, Africa, India and, of course, Central America and Latin American?

It is interesting that in his second reading speech Senator Whish-Wilson draws attention to the fact that the Australian government is currently being sued under the ISDS clauses as a result of a legislative decision the previous government took to require cigarettes to be sold in plain packaging. That is a 1993 agreement; it is 22 years old. Surely everybody in this place realises that we have moved on from the quality of legislation that is 22 years old. I also remind the chamber that this is not yet a settled matter. It is not yet a matter that has had any sort of resolution or judgment. I share concerns. We sat in the committee together. I share the concerns of academics and others. I also share the concerns expressed by the Chief Justice, a fine Western Australian jurist, Robert French. But, at the same time, the role of government is to balance these inputs and to arrive at decisions that are in the best interests of our country, and I want to spell some of those out.

I want to point out, if I may in the time that is available to me, where some of the pitfalls would come if, indeed, we were to pass legislation that prevents the Commonwealth—it does not caution the Commonwealth or give the Commonwealth any leeway in this; it prevents the Commonwealth—entering into an agreement with ISDS provisions. Of course, this blanket prohibition would completely and utterly limit our opportunity to negotiate into the future with foreign countries, be it for inputs or for exports. We could not conclude negotiations which would benefit Australian producers, consumers and investors, the broader community or, indeed, those communities in the countries with which we have such valuable trading relations, and it would impose on the Commonwealth a significant limitation on the ability to pursue our broader trade and investment objectives.

We have spent a lot of time in the last few days, as we have in the last couple of years, in this place debating how we are going to sustain and improve the socioeconomic wellbeing of our country—how we are going to be able to meet the social demands that are so eloquently debated in this place. But, Mr Acting Deputy President, you know that, as Senator Fifield said so well the other day, if the economic agenda and the social agenda are not in alignment, it will be to the demise of each of them. Unfortunately, what this bill, if passed, would do would be to totally limit the opportunity for our economic expansion, particularly at this time.

I feel remiss with the finance minister, Senator Cormann, here, because he is so much better versed than I am in being able to comment on the black clouds that are confronting the world at the moment as we look at what might happen with Greece defaulting or, indeed, jumping into bed with Russia—whose economic circumstances at the moment would be such that you would wonder how Russia would be able to bail Greece out of its current debt crisis. We look at other countries in Europe and the circumstances they are faced with. We have a look at the United States of America, the interest on whose debt—not the debt but the interest on their debt—is a billion dollars per working day at the moment—$250 billion they are borrowing. Senator Whish-Wilson understands this much better than I and as well as the finance minister does. To me, it all points to the fact that we must remember that we are an exporting country.

But, of course, this blanket prohibition that is proposed in the bill is inconsistent with the government's policy, which is to consider the inclusion of ISDS provisions in any free trade or other agreements on a case-by-case basis. It denies the government the opportunity to actually negotiate case by case. It says: 'No, sorry. We can't deal with China. We can't deal with Japan. We can't deal with Korea. We couldn't have dealt with Singapore. We're not allowed to deal with the Trans-Pacific Partnership, because we are prevented from even participating.' Nobody in Australia wants to see that—indeed, I do not think Senator Whish-Wilson does. What we do want to see is a very cultured discussion about those elements which are sacrosanct to Australia.

I go back to the point that the 1993 provision is 22 years old. This was not being considered 22 years ago. Possibly it could have been predicted 22 years ago, but nobody is suggesting today that the sorts of agreements that we are negotiating and contemplating have not moved on and are not taking into account those environmental, health and other concerns on which we are, of course, so focused.

The bill proceeds from the view that ISDS invariably represents an unacceptable risk to the public interest and that all provisions are equally severe. We are conscious of potential risks, and I would rely on the excellence of the trade minister—leading and directing the bureaucrats in the department, who are now so well versed in the processes of international trade negotiations—and on being able to govern and to regulate in the public interest in areas such as health and the environment.

On this topic, I would be amazed if in his previous work Senator Whish-Wilson has not come across similar clients. As a businessman myself, and having in the last decade engaged in business activities in Asia, in the Middle East and on the Indian subcontinent, I know that ISDS does not just apply to ogres wanting to come into Australia. ISDS gives a level of protection to Australian industry operating overseas. This is vitally important, because we have the opportunity and indeed, in my view—particularly in the field of agribusiness, in which I spend a lot of my professional time—the compulsion to increase our business activities overseas. I for one would be saying that, in any sorts of agreements that Australia is negotiating, I would want to see our government and our trade negotiators making sure that the interests of Australian business are being protected. Indeed, if we were to prevent the Commonwealth from entering into agreements, we would be cutting off the opportunity for Australian businesses operating overseas to enjoy the protection of ISDS clauses. It is a two-way exercise; it is not just a one-way exercise.

The bill in its current form fails to recognise that agreements containing ISDS can incorporate safeguards to protect the rights of governments and the communities they represent to take decisions in the public interest. The bill suggests that this is not possible; I say that it is. In fact the recent agreement negotiated, again, by trade minister Robb leading the delegation of people who undertook it with the Republic of Korea, contained many more safeguards indeed than earlier agreements. This is how policy works. This is how democracy works. This is how government works. We should always be moving to improve what has gone before us. In the case of Korea these safeguards have been developed in response to concerns about challenges to legitimate public welfare regulation. I, for one, enjoyed the opportunity to participate in the committee and to hear the legitimate concerns of people who not only have the expertise but defend the time. Two instances in the case of Korea where we were not freezing existing policy settings were to do with intellectual property and the environment chapter; exactly the concern that Senator Whish-Wilson and Senator Wright have expressed saw itself played out. Indeed, we have ISDS clauses in four existing free trade agreements and 21 bilateral investment treaties—binding obligations that have been ongoing over 25 years—and I remind those listening that we have only ever faced one claim; we are facing that now and that has not yet been tested or resolved. Not bad for a country of 23 million people that exports more than 65 per cent of its produce around the world.

Who, in fact, are the players? Of the bilateral investment treaties that we are considering, more than 90 per cent of the 2,500 in force have operated without a single investor claim. We know that the inflow of capital is vital to this country, and of course the inflow of capital reflects the claims—for Europe, it is about 50 per cent and about 47 per cent of the claims. For the United States, the next biggest player in this game from Australia's point of view, it is 24 per cent of FDI stock outflow from them and 22 per cent of the claims. It is in the resources sector—mining, oil and gas resources—where most of the claims have been made, because they are the sectors in which there is the greatest degree of state involvement, and I hope to come to Mexico in a few moments by way of illustration. The disputes have been mainly around countries with weak legal institutions—Argentina with 53 claims and Venezuela with 36 claims are the two leading respondent states. About a third of all ISDS cases are settled in advance of a ruling, and it is the case that people come to realise it is as expensive to run an ISDS claim as it is to go through the commercial legal process. We see that treaty-based investment protection represents a major advance in the fair treatment of aliens and the peaceful resolution of disputes. When you consider the alternative—withdrawal from these treaties, which is the logical conclusion should the good senator's bill be accepted—then the negative consequences for economic growth in this country and the rule of law are there for all to see.

I want to continue now in terms of what those opportunities are. We are an economy of some $1.6 trillion. The services sector contributes about 70 per cent—about $1.12 trillion—of that economic activity, but at the moment the services sector only contributes 17 per cent—$57 billion of $330 billion—towards export income. Therein lies the opportunity for this country to radically increase the contribution of the services sector to export earnings as resources earnings go down because of the decline in oil and gas prices and of course the price of iron ore and other resources. You turn and say, 'That is all well and good, Senator Back. Where are these opportunities for increasing the services sector from 17 per cent?' Imagine, Finance Minister, if the services sector expanded its export activity from 17 to 34 per cent. Do you know where the answer lies? It lies in those countries with which we have just concluded free trade agreements. When Minister Robb briefed us on the value of the Chinese free trade agreement to our country, as a person involved in agriculture and resources I was thinking, 'This is wonderful.' We already export a lot of iron ore. In fact, for your interest, we actually export 19 tonnes of iron ore per person to our overseas markets—we did that in 2014.

But Minister Robb told us that what the Chinese actually want is access to our services. They want further access, for example, to our education services. Last year our education services to China were valued at in the order of $4 billion. The value of tourism from China to this country is in excess of $1 billion. That is just those two services alone—higher education and tourism—but add in to that the opportunity for services exported for governance, for prudential regulation, for insurance purposes, and the fact that that particular free trade agreement has now guaranteed that Australian service providers will be able to construct, renovate and wholly operate Australian-owned hotels and restaurants in China. How often have we heard, 'Of course, it is all well and good—they can come here to our country, but we cannot do the same.' Under this agreement we can; but if the provisions of Senator Whish-Wilson's bill had prevailed, we could not have. Australian travel agencies and tour operators, for example, are now able to establish wholly Australian-owned subsidiaries in China for tours within China for domestic and foreign travellers. And remember: in 2014, 100 million Chinese travelled outside their country, and it is predicted that, by 2016, that will double. Another area of services that they desperately want and need from us has led to the decision under the free trade agreement that China will permit wholly-owned Australian hospitals and aged-care institutions to be established in China and run and managed by Australians. Those are just three examples, in hospitality, in tourism and in the health and hospital and aged care sectors. And, as I say, there is the value of higher education. That is for just one country. If we expand that to Japan, which also has an ageing population, there is an opportunity for expansion of our services sector.

Mention was made by previous speakers about the Trans-Pacific Partnership. I was in Mexico only some three weeks ago, discussing with government officials and industry people—for example from the oil and gas sectors, the hard-rock mining area and the energy sector—the value of NAFTA, the North American Free Trade Agreement, to Mexico; it has been massive. But the Mexicans said, 'We cannot wait for the inclusion of more Australian investment.' At their geological survey institution they showed me proudly the geological map of Mexico at the one in 250,000 level and noted the fact that, in those mineral-rich areas of Mexico, they have actually now mapped it at one in 50,000. They then turned to me—through you, Mr Deputy President Marshall, to Senator Whish-Wilson—and said: 'Do you know where we got that expertise from, Senator Back? We got it from Geoscience Australia, and we got it from the CSIRO.' How proud do you think I was? And when they said, 'We are now sending 50,000 of our university students away every year to learn more about energy, oil and gas,' I thought, 'What opportunities are there for Australians to get in there, in hard-rock mining, in their services sector, in their corporate governance, in their insurances and in their health sector?' Those opportunities will be open to us, but, indeed, if we were to accept the provisions of this particular bill, we would be denied them because they will have ISDS provisions.

Lee Rhiannon (NSW, Australian Greens) Share this | Link to this | Hansard source

The Greens' Trade and Foreign Investment (Protecting the Public Interest) Bill 2014 should be passed. Such legislation would play a critical role in protecting and enhancing our democracy, and I very warmly and strongly congratulate Senator Peter Whish-Wilson for initiating this bill before us. I speak about democracy because this really is about protecting democracy—protecting Australia as a sovereign nation, and making it harder to run down the all-important gains that society has managed over a number of decades with regard to labour standards, environmental protection and human rights—because the protection this bill would put in place would bring some balance back to the very damaging aspects of free trade and specifically the Trans-Pacific Partnership. So this bill is urgently needed.

There has been a long history in Australia of opposing some of the very damaging aspects of the push for free trade, and I would like to go into some of that history. I also want to congratulate, as well as Senator Whish-Wilson, many members of the Greens, the union movement, AFTINET, church groups, environment and human rights organisations and aid groups, because they are out there informing the public of how serious it is in terms of the secret negotiations. If the partnership—particularly with regard to the investor-state dispute settlement clauses—is put in place, that would do damage to the very fabric of our society, from our important basis of democratic institutions to so many aspects of our society that, often, we take for granted. So it is incredibly important that we deal with this.

I think it is worth reminding ourselves that a previous government, the Howard government, in 2004 did not include ISDS in that free trade agreement. I mention that because, when former Prime Minister John Howard came in, in the 1990s, his government really got their fingers burnt with what they were trying to do when they were meddling in a very similar scheme—actually, a much more extensive scheme—which large corporations were attempting to impose across the planet.

I am referring here to the Multilateral Agreement on Investment. You could really say that the grandparents of the Trans-Pacific Partnership and investor-state dispute settlement were the OECD and the MAI—or that the OECD gave birth to the MAI. This was a huge part of the 1990s when various very under-resourced organisations and some key hardworking activists—and, fortunately, emails were just coming into their own at that period—found out what was going on and alerted the world, and so many people rose up in opposition. That opposition was extensive and, ultimately, successful, and the Multilateral Agreement on Investment was put to bed. But now we are seeing it come back in different forms. So I think it is worth looking at what happened in the 1990s, because it is important for us to understand that this has been well debated and has been rejected, en masse, not just by Australians but by people around the world. So I did want to go into some of those aspects.

One important point was made in that debate—and I was very much part of it in the 1990s, since I was at that time the director of AID/WATCH, a non-government organisation monitoring Australia's overseas aid program, and this became a large part of our work—by Noam Chomsky. One of his arguments was that the OECD, as an organisation of rich countries, was more susceptible to direct influence by corporations; that is who they would be representing. He advocated that, when we are considering changes to trade agreements, that should come under a body such as the United Nations Conference on Trade and Development. And there was a real in-depth analysis of how these agreements should occur.

On the side of those backing the MAI, there was a period where the Liberals and Nationals were right out in front, arguing along with the corporate world that the MAI would bring secure and stable investment conditions and regulate investment in a more uniform way. They rejected the idea that it would be a race to the bottom by saying there would be uniform conditions for corporations around the world. But, when people started get to get a hold of the documents and look at the detail, what they could see and what the world was alerted to was that it was in fact a race to the bottom because it was about developing means to erode labour conditions, erode environmental standards and erode human rights—because the power would be there to penalise governments if there were any measures that restricted the profits of the corporations.

Here is a little bit of history, because it is important that we remember that this was all done in secret. How did the world find out about it? There were some lucky breaks, there were some leaks and there were some incredibly hardworking people, mainly from organisations in low-income countries: the Third World Network, the NGO Public Citizen, Global Watch, Friends of the Earth, and Susan George, a very progressive economist at the time who was onto this. The documents were released and the analysis was done. I remember people at the time saying, 'What will kill off the multilateral agreement on investment is people knowing what it really does,' and that is what happened. The documents were analysed, the information was out there and emails started going around. Maybe it was even one of the first examples of an email campaign killing off really bad plans by the corporate world with a few backers—in Australia's case, the Liberal and National parties. I very much congratulate those people, and it was a fantastic campaign to be a part of.

I will go through how it played out in Australia. We had a Stop MAI coalition. It was huge and brought together unions, a whole number of church groups that were incredibly active, aid organisations, environment groups and human rights groups. It culminated on—and I like the date this occurred—11 November 1998 in a newspaper advertisement in The Australian signed by more than 500 organisations, setting out the concerns that we had with this whole legislation. It was important that that was put on the record because again it helped to inform more people, obviously.

Interestingly, as the movement was growing around the world, the pressure from France was particularly significant because France was the first country to pull the plug on these negotiations and, while I cannot fully explain how the OECD works, that really did cripple the negotiations. Shortly afterwards, the Howard government pulled out of the negotiations as well. But it shows the strength of civil society here and around the world that there were so many people active in a very, very collaborative and constructive way.

Some of the points that we made in the advertisement in The Australianincluded—these are the words from the advertisement at the time:

The Multilateral Agreement on Investment is a treaty which would give multinational corporations the standing previously only granted to nations, and a freer hand to challenge labour standards, environment protection, social justice and democratic control over all levels of government, worldwide.

It went on to say that Australia must withdraw now and not resume the negotiations in any other form. I emphasise 'not resume the negotiations in any other form', because in the 1990s we were aware of what this was all about. You could feel the momentum building around the movement of opposition. You could feel, as you can sometimes with progressive movements, that a win was in the air. The corporate world is all-powerful. They want to increase their profits; that is what they are on the planet to do. That is why the MAI could well arise in another form. And that is what we are seeing now with the Trans-Pacific Partnership and with the many other so-called free trade agreements. That is why I wanted to give emphasis to why we included that all-important phrase in the advertisement: Australia must withdraw now and not resume the negotiations in any other form. For the record, former Greens Senator Dee Margetts was one of the people who signed that ad, as well as the New South Wales Greens, a whole number of activists and heaps of organisations around the country. As I mentioned, there were about 500 in all.

That brings us to the current problems we are facing, and they are considerable. I urge senators from the other parties to look at this bill closely. There is nothing in it that serves the interests of any group, including corporations, because this form of so-called free trade with its ISDS clauses is a robber-baron form of capitalism, and, in the end, that is not good for the corporate world. Maybe they will increase their profits in the short term, but it will become destructive not just to workers, not just to the environment, not just to people's humans rights; it will bring a breakdown in how our society works. I say that most strongly because over time, over decades and, I believe, over centuries, the different protections, the different regulations and the different standards that we have passed and brought into practice—what some people try and dismiss as green tape and red tape—have come about to improve our society, a society where it is about being collective, about supporting each other. Again, yes, in the short term the corporate world might be really rapt that we have ISDS clauses and they can do all this behind closed doors and hammer governments around the world if their profits are limited. But in the long run it is not going to benefit people. Workers need to get a wage and they should be safe and able to go home at the end of the day—not maimed in some way or killed. We need an environment that is protective and that is there for future generations, not one where we have a huge burden because of the levels of pollution. All these things are interconnected, including how companies operate. So again I would urge all to look closely at this bill.

International debate around these issues is growing enormously because there is increasing recognition that corporations have too much power over our democracies. This goes back to the starting point, and it is one of the aspects that have impressed me so much about how Senator Peter Whish-Wilson has taken forward the debate around this issue. He has made all the connections and really pinpointed how damaging this legislation would be if it were passed. It is particularly damaging because including ISDS clauses in international trade agreements tips the balance of power further in favour of the corporate world.

The working of our society is already out of balance to a great degree. We need to get back to recognising the broader public interest in terms of public health, public education, public housing—all the issues around our commons. We need to recognise how the public interest works and what we need to look after for a healthy society and for future generations. All these issues are interlinked. They are a reminder of why ISDS clauses have no place in international trade agreements.

ISDS clauses introduce potential risks to the public interest and the sovereignty of any nation. We have seen that in many recent studies. Going back to some of the experience that I gained when we were opposing the Multilateral Agreement on Investment, I remember that some of the Latin American countries had in place rules that said that if a foreign corporation was going to operate in their country the company would be required to employ so many local workers. It was realised that it would be impossible to maintain such a position under the Multilateral Agreement on Investment and that it would limit the rights of countries in improving their conditions. That is how we know of the risks associated with ISDS.

I have mentioned the growing opposition to this form of trade agreement. I would urge senators to look closely at that opposition. Over 100 academic experts to the European Commission inquiry into ISDS found that the many risks that ISDS clauses impose on the public interest cannot be managed simply by having certain safeguards for certain sections of these trade agreements. You cannot put the ISDS clauses and then establish safeguards. That is just a con job to try to make out that something is being done. It cannot be effective. It cannot remove the extraordinary extent of the damage. We must not even go there in the first place. We know that the government proposed safeguards in its deals, such as the Korean free trade agreement. That is not satisfactory. We cannot solve the problem in that way.

Returning to the study by the academic experts to the European Commission, the so-called extensive safeguards were rejected most decisively by those academics as being inadequate. We think that is where considerable attention needs to be paid.

I would like to pay tribute to the many groups who are working on this campaign. One of the leading organisations in Australia is AFTINET, the Australian Fair Trade and Investment Network, which has taken up this issue for well over a decade, examining the free trade agreements that have come forward, coming down to parliament, briefing people and putting material out there. Pat Ranald, who is the convenor of AFTINET, in talking about ISDS clauses, stated that they give:

… additional rights to foreign investors to challenge domestic laws which may be made as part of protecting or advancing human rights or environmental sustainability. Those are the kinds of examples that we cite in our submission. So our worry is that ISDS has the potential to undermine or challenge domestic law which seeks to protect those broad principles of human rights and environmental sustainability.

That has very much been a theme of the comments that I have shared with senators today, that the degree of destruction that ISDS would bring to the very fabric of our legal protections, the fabric of so many standards that have been established, goes to the heart of the democratic process. If you have a corporate power that is structured in such a way as to be higher, greater, than parliaments or governments then clearly it is a challenge to democracy. That is why we Greens are giving so much emphasis to this and why so much of civil society in Australia has examined this and is alerting people to these problems.

I do believe that this is a time when we need to take the strongest stand. It is informative that Justice French has written a very substantial paper about this in which he goes into this issue in detail. I understand that some of the senators from other parties may not be willing to take on board what the Greens are saying, but I want to emphasise that this is much wider than ourselves. I would very much urge that you read the very detailed paper that Justice French wrote, because he raises the very critical aspects of the lack of transparency involved. As I mentioned in relation to the Multilateral Agreement on Investment, it was because of some incredibly hard work, some good breaks, some leaks, that word was able to spread about the damage it would do. The Trans-Pacific Partnership Agreement also is highly secretive, but some excellent work has been done by Civil Society and by Senator Peter Whish-Wilson to get the word out. Justice French adds to this all-important work, particularly in identifying issues around the lack of transparency. You see that this is a recurring theme when you start to examine what is going on. When something is as secretive as this, one has to ask why that is. The answer is because those who are involved know that it will be deeply unpopular, that if people understand the detail the opposition to it will start growing and will apply more pressure. My guess is that they probably remember what happened in the 1990s, probably many of them were around then. They learnt from their side of politics wanting to serve the corporate interests how to manage the debate around this. Again, they have tried to keep it secret. Senator Peter Whish-Wilson is to be congratulated. This bill is excellent and it should be passed.

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

Order! A remarkable convergence of the clocks means that time for this debate has now expired.