TPPA: Litigation and Power of Government

The MITI Open Day on TPPA will be held this morning beginning at 9 AM. at Martrade Building.

There have been many concerns raised and MITI should set the record straight because this country does not belong to only government official and politicians but more the people. There is no such thing as being more concern for other countries.

The one major concern in the back of every red blooded patriotic Malaysian is sovereignty.

The not so patriotic ones do not care. They leave the country and Talentcorp stupidly paid taxpayers money to entice them back with preferential salary over others willing to do service to the nation at already accepted payscale. .

On this issue, we extract from Dr Mahathir's blog posting, below:

20. ... And now they invented TPP, a partnership of unequal, of the strong to take advantage of the weak.

21. This is going to be legally binding. If we breach the agreement, their corporations can sue the Government for billions. I have my doubts about our ability to convince the international arbitrators or courts. We cannot even convince the World Court over Pulau Batu Puteh.

22. They will have the best lawyers, lots of them. We will exhaust all our funds to pay our less experienced lawyers. At the end we will lose and pay indemnities and fees running into billions. And we will continue to pay until we comply. And when we comply we will lose more money.

23. We have a domestic problem and we have to solve this problem. They don’t care. Anyone who talks about the New Economic Policy (NEP) is labelled racist by our officials. When the currency rogues attacked us the purpose was to gain control over our economy. We resisted that because we were still free then. But after we sign the TPP we will be bound hand and foot. No more capital control. We will be colonised again. President Sukarno was right about neo-colonialism.

Those patriotic Malaysian should be concern when the power of government to do what is necessarily good for the people and nation. As far as those money driven greedy businessman with silo mindset that do not bother about the interest of the nation, ignore their oinking and barking.

There are many cases of MNCs using the court to undermine government. One fine example is as per the IPS news taken from this website here, reproduced below:

U.S. Company Threatens Peru with Free Trade Lawsuit   

Written by Milagros Salazar 
Monday, 17 January 2011 21:07

(IPS) - The U.S. mining and metallurgical company Doe Run has once again challenged the Peruvian government. The Renco Group, of which it is a subsidiary, notified the government of its plans to start an international arbitration process, invoking the free trade agreement between this South American country and the United States.

The U.S.-based holding company said the arbitration will be filed in 90 days if no agreement is reached. What is behind this ultimatum?

In ads published Jan. 5 in newspapers in Lima, the Renco Group said it was turning to the mechanisms provided for by the trade promotion agreement because it had received "unfair treatment" at the hands of the Peruvian government and had not been given "protection and security" as an investor, as required by the treaty.

Doe Run began to run the large multi-metal smelter in the central Peruvian highlands city of La Oroya, known as one of the most polluted places on earth, after the plant was privatised and acquired by the Missouri-based firm in 1997.

When it won the concession to operate the plant, Doe Run promised to complete an environmental improvement programme, known by its acronym PAMA, within 10 years. But the Peruvian state also assumed a commitment to clean the soil in and around the town, because the factory, which was built in 1922 by the Cerro de Pasco Corporation, a U.S. firm, was taken over by the state-run Centromin Peru in 1974.

Doe Run now claims that Activos Mineros, the state-run firm that took over Centromin's responsibilities, has refused to clean up the soil in La Oroya, and "has refused to accept responsibility for the legal action brought by the citizens living in and near the town of La Oroya who claim various injuries resulting from alleged lead exposure and environmental contamination" from the smelter complex.

"But it is Doe Run that has failed to fully implement PAMA and has continued to pollute in La Oroya," former deputy minister of mines María Chappuis told IPS. "This communiqué is as if they were telling the government: we pollute and you clean up."

Chappuis resigned from her post in December 2004 to protest an extension of the PAMA deadline that the government granted to Doe Run.

The former official complained that the company wants the government to pay for any damages that a U.S. court could order for the families of more than 100 children with lead poisoning in La Oroya.

In late 2010, a court in St. Louis, Missouri, where Doe Run's corporate offices are based, ruled that 11 lawsuits filed against the Renco Group and Doe Run by a group of citizens from La Oroya could go ahead in that venue. The plaintiffs are suing over injuries from lead exposure and environmental pollution caused by the smelter.

If the court rules in favour of the plaintiffs, the company will have to pay reparations to the families of the children.

Doe Run committed itself, through PAMA, to reaching a target of 95 percent of children under six in La Oroya with a lead level below 10 micrograms of lead per decilitre of blood (mcg/dl), regarded by the World Health Organisation as the maximum safe limit.

But Peru's Health Ministry found that 99 percent of children under six in La Oroya had lead poisoning.

Doe Run also promised to build three sulphuric acid plants for its lead, zinc and copper processing operations. But the copper circuit plant, the most crucial, has not been completed.

As of mid-2009, Doe Run had failed to fulfil 20 percent of the PAMA programme. And since then, no progress has been made, because the company was temporarily shut down in June 2009 after declaring bankruptcy, despite soaring metals prices.

It then missed the July 2010 deadline set by the government of Alan García for proving that it had the necessary financing to restart operations and complete an environmental cleanup.

"The 90 day deadline (that Doe Run gave Peruvian authorities) sounds suspicious," said Chappuis. "What it is trying to do is provide enough time for the emergence of someone who yields to its pressure, as happened before, especially now, during an election year." General elections are due in April.

The former official was referring to a letter sent in October 2007 by then prime minister Jorge del Castillo (2006-2008) to then U.S. ambassador to Peru Michael McKinley, asking the State Department to intervene in a lawsuit that had recently been brought in Missouri against Doe Run Resources Corporation.

In the letter, Del Castillo asked the U.S. government to contact the Department of Justice and the St. Louis court, in order to avoid "setting a disturbing precedent for investors in both countries, which would undermine legal security."

In response to criticism, the former prime minister said he had sent the message "to avoid controversy in the face of the approval of the free trade agreement with the United States," which went into effect in early 2009.

If the international arbitration proceeding goes ahead, the Renco Group would become the first company to turn to the mechanisms for that purpose created by the free trade agreement.

"The Peruvian government must not make another mistake, and has to act cautiously," said economist José de Echave of CooperAcción, a Peruvian NGO working for development.

In response to a query by IPS, the Ministry of Energy and Mines said "The state will only pronounce itself on this matter through the legal routes."

Activos Mineros, for its part, published an insert in a local magazine, stating that it had planned to invest 35 million dollars in a cleanup plan between 2007 and 2015, and that so far 4.8 million dollars have been spent to carry out a study on soil remediation and urban cleanup actions.

IPS was also informed that Activos Mineros has already calculated how much Doe Run would have to pay Peru for the remediation, because it was reported that the contract establishes that if the company that took over the smelter did not have better environmental performance than Centromin, it would have to assume part of the costs.

"If in 2004 the company had not received an extension of the deadline for completing PAMA, the firm would not have invoked the free trade agreement, which did not enter into effect until five years later," de Echave said.

He also questioned claims that "a court like ICSID (International Centre for Settlement of Investment Disputes) has environmental sensibility, when its rulings tend to go in favour of investors."

De Echave pointed out that since the start of the negotiations of the free trade agreement, a number of organisations warned that the chapter on investment made too many concessions. "And today we're seeing the consequences," he said.

This basically cripples the power of authorities to safeguard the interest of the people and nation.

Governing is bounded by agreements and the final determinant is the court. It means the power as government has been shifted to the courts.

Decisions are made not for the interest of nation and rakyat but based on legal precedents, interest of few over many and arguments of lawyers. Lawyers arguments is seldom not for truth but the interest of their paymasters. They have no qualms to conveniently keep facts that is not favourable to their client at the expense of nation and rakyat.

And, the public think they are ladies and gentlemen in black.

As pointed out by Dr Mahathir, Government will not be allowed to solve it's "domestic problem" because the MNCs "don’t care."

When TPPA is signed, the country will not be doing trade.

Instead, as pointed out privately by a reknown former Federal judge, it will open up "thousands and thousands of litigation which will take years to reach decisions or settlements."

The government will be with faced with a bottleneck of international legal cases that usually takes 3 to 5 years to settle. Time will be spent addressing legal issues that there will be no time to do business and benefit from TPPA.

The problem lies with the reality that Malaysian at the apex of power and trade tend to have a colonised mind and get overawed with orang putih. In the case of Dato Dr Jamaluddin Jarjis, he is overawed with a mixed black American.

We refuse to listen from our own people but rely on foreign consultants with their fixed template to solve all solutions.   

On that point, we highlight the view of Corporate Europe Observatory website here is similar to the view our Malaysian judge had foreseen earlier.  

Malaysia memang boleh but Tingkat 4 and PEMANDU that thinks Malaysia tak boleh because these idiots have no sense of guilt to spend RM31,000 per person to bring back Malaysian who has no sense of selflessness.

We extract a passage from a June 2013 article to highlight the point, below:

... The proposed Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US will open the floodgate to multi-million Euro lawsuits from corporations challenging democratic policies to protect the environment and public health, argues a new briefing by Corporate Europe Observatory and the Transnational Institute.

"A transatlantic corporate bill of rights" analyses leaked proposals for so-called investor-state dispute settlement under the proposed EU-US deal and reveals a determined lobby campaign from industry lobby groups and law firms to grant unprecedented rights to corporations to sue governments for legislation and regulations that interfere with their profits.

The proposal, which has come to light in leaked versions of the EU’s draft negotiating mandate for the transatlantic negotiations1, would enable US companies investing in Europe to skirt European courts and directly challenge EU governments at offshore tribunals. EU companies investing abroad would have the same privilege in the US.

Such far-reaching investor rights would bring a corporate litigation boom – that has so far mainly affected developing countries – to the US and Europe. Investor-state disputes have risen thirteen-fold from 38 cases in 1996 to 514 cases in 20122, often involving millions of dollars and regularly undermining democratic policies. In both Uruguay and Australia, US-based tobacco giant Philip Morris has sued over health warnings on cigarette packets; Swedish energy multinational Vattenfall is seeking $3.7bn from Germany following a democratic decision to phase out nuclear energy; and US-company Lone Pine is suing Canada for US$250 million over a moratorium on controversial shale gas extraction (fracking) in Quebec....

The Singapore-based Third World Network also has the same concern despite Singapore being one of the early founding members of TPPA. 

Return back to Dr Mahathir's posting as he reminded that we have lost out in several bilateral agreements because of our inability to negotiate. Our negotiator views the TPPA negotiation as "a good learning experience."