Canada and Mexico want ISDS in NAFTA, against their own national interests
September 18, 2017: Ambassadors from Canada and Mexico have told Politico that their governments want to keep Investor-State Dispute Settlement (ISDS) in the North American Free Trade Agreement (NAFTA), despite the fact that most NAFTA ISDS cases have been taken by US companies against their governments. In contrast, US negotiators are reportedly responding to strong US community opposition and may want to make ISDS optional in a revised NAFTA.
ISDS allows foreign investors to sue governments in an international tribunal if they can argue that a change in law at a local, state or national level has ‘harmed’ their investment.
Canada wants to use as a model the ISDS chapter in the Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union, which attempts to make the tribunal system more independent. The US Trump administration position is not yet public. But US negotiators are reportedly considering an ‘opt-in’ clause for each country. This is being opposed by US corporate interests that strongly support ISDS.
Many community groups in all three countries remain strongly opposed to the inclusion of ISDS in the NAFTA. Even if the tribunal system is changed, the issue of already powerful foreign investors being able to sue governments remains. ISDS should be scrapped – not sweetened.