THERE is no proof that Malaysia will benefit from the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), said economists.

A public forum today was told that the CPTPP, formerly known as the Trans-Pacific Partnership (TPP), and other similar treaties might even be detrimental to the country.

“This is due to the Investor-State Dispute Settlement (ISDS), which allows foreign investors to sue a government, using international laws, for not protecting the value of the investment,” said Burghard Ilge, an economic researcher from Both Ends.

He said if foreign investors did not get their Return on Investment, it was possible for them to sue the government that signed the treaty.

“The investment protected is also the value of the trademark, and the matter can be taken to the international tribunal,” he said, referring to the International Centre for Settlement of Investment Disputes (ICSID), which is a mechanism of the World Bank that provides conciliation and arbitration in disputes between countries and investors from among World Bank members.

All nations in the CPTPP are part of the World Bank.

“Even if a government gets out of a treaty, like a Bilateral Investment Treaty (BIT), that doesn’t mean that you can just drop everything and leave,” said Ilge.

“Most treaties have survival clauses. This means that the treaties are still in effect for a certain amount of years.”

Prime Minister Najib Razak had announced that he would soon negotiate a BIT with the US, following the latter’s withdrawal from the TPP.

In the US model of BIT, the survival clause under Article 22(3) requires the treaty to be in effect for 10 years from the date of termination.

Kavaljit Singh, director of the Public Interest Research Centre in New Delhi, said there were 600 cases last year involving the ISDS.

“Although 70% of the time, the government wins, 30% of the time, foreign investors will take it up to the ICSID because the government has everything to lose.

“The ISDS allows foreign investors to challenge laws or policies of the government if they believe that the laws or policies diminish their future profits, and there is nothing the government can do about it.”

However, he said, the public could still call for a treaty to be terminated if it violated human rights policies.

“This is called the ‘Exhaustion of Domestic Remedies’. Before submitting a complaint to the ICSID, the individual or organisation must first attempt to remedy the human rights violation using domestic laws.”

Karina Yong, an economic researcher from Third World Network, said the ISDS was originally introduced to protect investors from being exploited, but had since changed for the worse.

The three-man panel was moderated by Klang MP Charles Santiago.

Najib recently said the CPTPP was still alive despite the unexpected absence of Canadian Prime Minister Justin Trudeau at the November 10 meeting.

The CPTPP countries are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. – November 18, 2017.