<div dir="ltr"><div class="gmail_default" style="font-size:large"><br></div><br><div class="gmail_quote"><div dir="ltr" class="gmail_attr">From: <b class="gmail_sendername" dir="auto">Jomo</b> <span dir="auto"><<a href="mailto:jomoks@yahoo.com">jomoks@yahoo.com</a>></span><br></div><br><div><div style="font-family:garamond,new york,times,serif;font-size:16px"><div id="m_5354887002833328589ydp7f227dfayiv6260989495"></div></div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495yqtfd70558"><div><div style="font-family:garamond,new york,times,serif;font-size:16px"><b style="color:rgb(38,40,42);font-family:Calibri,sans-serif;font-size:11pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif">ISDS enables making more money from losses </span></b><br clear="none"></div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyahoo_quoted_8351316532"><div style="font-family:'Helvetica Neue',Helvetica,Arial,sans-serif;font-size:13px;color:#26282a"><div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851"><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851yqtfd26621"><div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yahoo_quoted_8498268302"><div style="font-family:'Helvetica Neue',Helvetica,Arial,sans-serif;font-size:13px;color:#26282a"><div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231"><div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231ydp92315079yahoo_quoted_8480275344"><div style="font-family:'Helvetica Neue',Helvetica,Arial,sans-serif;font-size:13px;color:#26282a"><div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231ydp92315079yiv6168949234"><div style="font-family:garamond,new york,times,serif;font-size:16px"><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231ydp92315079yiv6168949234ydpa05bf0f5yiv2634411098"><div style="font-family:garamond,new york,times,serif;font-size:16px"><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231yqtfd80763"><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif"><i>Jomo Kwame Sundaram</i></span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif"> </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">KUALA LUMPUR: With the Covid-19 contagion from late 2019 spreading internationally this year, governments have responded, often in desperation. Meanwhile, predatory i</span><span style="font-size:13.5pt;font-family:Times New Roman,serif">nternational law firms are encouraging multimillion-dollar </span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">investor-state dispute settlement (ISDS) </span><span style="font-size:13.5pt;font-family:Times New Roman,serif">lawsuits citing Covid-19 containment, relief and recovery measures.</span><span style="font-size:13.5pt;font-family:Times New Roman,serif"></span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"> </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><b><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Sharing the pain</span></b></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Most governments failed to introduce sufficient precautionary measures early enough to prevent Covid-19 contagions from spreading. And when they did act, they often believed they had little choice but to impose nationwide ‘stay in shelter’ lockdowns to enforce preventive physical distancing.</span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">To enable businesses and households to survive the adverse effects of such lockdowns, governments have provided relief measures, for at least some of those believed to have been adversely affected, especially for businesses better able to lobby effectively. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Meanwhile, there are already thousands of mainly bilateral investment treaties as well as bilateral and plurilateral trade agreements worldwide, enabling foreign investors to sue governments before private arbitration tribunals to profit from their wide-ranging treaty rights.</span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Transnational corporations (TNCs) can claim staggering sums in damages for alleged investment losses, for either alleged expropriation, or more typically, indirect ‘damage’ caused by regulatory changes, in this case, Covid-19 government response measures. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">As some such measures try to share the burden of the crisis, e.g., with asset owners and other contracting parties, the international law firm </span><span style="font-family:Times New Roman,serif" lang="EN-US"><a shape="rect" href="https://www.shearman.com/perspectives/2020/04/covid-19-international-investment-protection?sc_lang=ja-JP" style="color:rgb(149,79,114)" rel="nofollow" target="_blank"><span style="font-size:13.5pt" lang="EN-GB"><span lang="EN-GB">Shearman & Sterling</span></span></a></span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"> advises financial firms, “While helping debtors, these measures would inevitably impact creditors by causing loss of income”, referring to debt relief and restructuring efforts among others.</span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Foreign registered real estate or property companies can also sue governments that protect lessees or tenants who cannot make their lease or rent payments as contractually scheduled after their operations are shut down or disrupted by emergency regulations imposed. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Pharmaceutical and medical supplies companies can also appeal to such arbitration tribunals to claim losses due to price controls and ‘violated’ intellectual property rights for Covid-19 tests, treatments, medical and protective equipment as well as vaccines. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"> </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><b><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Lucrative ISDS lawsuits</span></b></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">In recent months, international law firms have been encouraging ISDS lawsuits citing government measures to check contagion and mitigate their economic consequences, urging clients to invoke investment and trade agreements to claim for allegedly lost income or additional losses or costs due to new government policy measures.</span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Another firm </span><span style="font-family:Times New Roman,serif" lang="EN-US"><a shape="rect" href="https://www.ropesgray.com/en/newsroom/alerts/2020/04/COVID-19-Measures-Leveraging-Investment-Agreements-to-Protect-Foreign-Investments" style="color:rgb(149,79,114)" rel="nofollow" target="_blank"><span style="font-size:13.5pt" lang="EN-GB"><span lang="EN-GB">Ropes & Gray</span></span></a></span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"> advises: “Governments have responded to COVID-19 with a panoply of measures, including…limitations on business operations, and tax benefits. <i>Notwithstanding their legitimacy</i>, these measures can negatively impact businesses by reducing profitability, delaying operations or <i>being excluded from government benefits</i>…For companies with foreign investments, investment agreements could be a powerful tool to recover or prevent loss resulting from COVID-19 related government actions.” [my italics] </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-family:Times New Roman,serif" lang="EN-US"><a shape="rect" href="https://www.shearman.com/perspectives/2020/04/covid-19-international-investment-protection?sc_lang=ja-JP" style="color:rgb(149,79,114)" rel="nofollow" target="_blank"><span style="font-size:13.5pt" lang="EN-GB"><span lang="EN-GB">Shearman & Sterling</span></span></a></span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"> advises, “</span><span style="font-size:14pt;font-family:Times New Roman,serif" lang="EN-US">Some interventions will be protectionist—they will seek to support or benefit domestic enterprises (strategic or otherwise) but not foreign investors”, without mentioning their generally far lower tax contributions and generous investment incentives enjoyed.</span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:14pt;font-family:Times New Roman,serif" lang="EN-US"> </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><b><span style="font-size:13.5pt;font-family:Times New Roman,serif">Profiting from the pandemic </span></b><b><span style="font-size:13.5pt;font-family:Times New Roman,serif"></span></b></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">After advising </span><span style="font-size:14pt;font-family:Times New Roman,serif" lang="EN-US">clients to look out for discriminatory measures which could become the bases for such claims</span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">, law firm </span><span style="font-family:Times New Roman,serif" lang="EN-US"><a shape="rect" href="https://www.sidley.com/en/insights/publications/2020/05/investment-treaty-claims-for-covid19-losses" style="color:rgb(149,79,114)" rel="nofollow" target="_blank"><span style="font-size:13.5pt" lang="EN-GB"><span lang="EN-GB">Sidley</span></span></a></span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"> warns governments that proceedings can be very costly as “it is not only the actually invested amounts that can be considered recoverable damages, but also lost future profits”. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Such law firms remind their clientele that many of the more than thousand ISDS lawsuits filed worldwide have arisen during political or economic crises. Covid-19 pandemic response measures are now being widely studied as possible pretexts for another round of lawsuits. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif">These corporate lawsuits can impose massive fiscal burdens on governments. As </span><span style="font-family:Times New Roman,serif" lang="EN-US"><a shape="rect" href="https://longreads.tni.org/cashing-in-on-the-pandemic" style="color:rgb(149,79,114)" rel="nofollow" target="_blank"><span style="font-size:13.5pt" lang="EN-GB"><span lang="EN-GB">Pia Eberhardt</span></span></a></span><span style="font-size:13.5pt;font-family:Times New Roman,serif">shows, legal costs average well over US$6 million per party, but can be much higher. Hence, s</span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">uch suits can drain government fiscal resources. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Although it becomes much more expensive if governments lose, they still have to cover their own legal expenses even if they do not lose. As of 2018, governments had been ordered to pay US$88 billion for settlements made public. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif">There is considerable scope for such cases given the still growing, broad range of</span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"> government Covid-19 measures, e.g., foreign-owned water supply companies can sue governments for insisting that more public water supply sources be provided, or household water supplies remain uninterrupted, even if water bills are not settled, to enable more regular hand washing. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"> </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><b><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">ISDS undemocratic, illegitimate</span></b></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">International investment law is generally independent of national legislatures and biased toward TNC interests. Investment agreements prescribe foreign investor rights and privileges very broadly, but their duties and obligations, usually rather minimally. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Sovereign national societies, parliaments and governments have considerable scope for discretion in addressing complex political issues involving diverse social and economic interests. Also, national courts generally do not award damages for lost future profits as these are considered completely conjectural. </span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">But ISDS provides much more favourable treatment to powerful TNCs. Also, international arbitration tribunals ignore and undermine the legitimate scope for national courts, law-making and democratic government decision-making. </span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(37,69,140)"></span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">The typically transnational arbitration tribunals that interpret such law generally ignore recent legal developments, which take more account of the rights and responsibilities of various other stakeholders in national societies. Thus, arbitration awards tend to be much more lucrative, for both TNCs and their lawyers, than ordinary national court decisions.</span><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(37,69,140)"></span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:14pt;font-family:Times New Roman,serif">A South Centre </span><span style="font-family:Times New Roman,serif" lang="EN-US"><a shape="rect" href="https://www.southcentre.int/wp-content/uploads/2020/08/SouthViews-Sornarajah-1.pdf" style="color:rgb(149,79,114)" rel="nofollow" target="_blank"><span style="font-size:14pt" lang="EN-GB"><span lang="EN-GB">Southview</span></span></a></span><span style="font-size:14pt;font-family:Times New Roman,serif"> urges considering various measures in response to the threat such as terminating or suspending investment treaties, withdrawing consent to arbitration, statutorily prohibiting recourse to arbitration and appealing to TNCs’ corporate moral responsibility</span></p><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)">Already, there are growing appeals for an immediate moratorium on ISDS lawsuits and to end ISDS proceedings involving Covid-19 emergency measures, while some countries, e.g., India, South Africa and Indonesia, had scrapped some of their bilateral investment treaties even before the crisis. </span><span style="font-size:13.5pt;font-family:Times New Roman,serif"></span></p></div><p style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"></p><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231yqtfd76398"><span style="font-size:14pt;font-family:Times New Roman,serif" lang="EN-US">The </span><span style="font-size:14pt;font-family:Times New Roman,serif">Southview</span><span style="font-size:14pt;font-family:Times New Roman,serif"> <span lang="EN-US">opinion also chides the United Nations Commission on International Trade Law (UNCITRAL) for trifling with marginal reforms, instead of radically reconsidering the very illegitimacy of international investment arbitration itself.</span></span></div><span style="font-size:14pt;font-family:Times New Roman,serif" lang="EN-US"></span><div dir="ltr"><div><a href="https://www.ksjomo.org/post/isds-enables-making-more-money-from-losses" target="_blank">https://www.ksjomo.org/post/isds-enables-making-more-money-from-losses</a><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231yqtfd37734"><br clear="none"></div></div></div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231yqtfd79678"><div><span style="font-size:13.5pt;font-family:Times New Roman,serif;color:rgb(20,20,20)"><br clear="none"><br clear="none"></span></div><p dir="ltr" style="margin:0cm 0cm 0.0001pt;line-height:normal;font-size:11pt;font-family:Calibri,sans-serif;text-indent:36pt"><span style="font-size:13.5pt;font-family:Garamond,serif"></span></p></div></div></div></div></div></div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231yqtfd57106">
            </div></div><div id="m_5354887002833328589ydpd69ab9bcyiv6260989495ydp7fe11deyiv0711926851ydp36d47265yiv9615949231yqtfd40197">
        </div></div></div></div></div>
            </div>
        </div></div></div></div></div>
            </div>
        </div></div></div></div></div></div>