Australia’s trade and investment relationships are, of course, critical, and they’re something that our government takes very seriously as we work to further Australia’s prosperity, both here and abroad. As this motion notes, investor-state dispute settlement, or ISDS, clauses have been a part of investment treaties and free trade agreements in recent decades. But, like many things, over years and decades there are changes in how we do things. This is a good thing. As we practice, as we learn from experience, we necessarily update the way we operate, and this is absolutely the case with ISDS clauses.

ISDS is a mechanism that is outdated. It gives power to foreign investors over communities and over governments here in Australia. In fact, it gives foreign companies the right to sue Australian governments—federal, state and local—for introducing laws that they argue have harmed their interests. These clauses can put taxpayers at risk of significant payouts. They can be used, in fact, against legitimate government policy. It is entirely possible for us to negotiate trade agreements that are beneficial to Australian businesses, that are beneficial to our country, without needing to include ISDS clauses. So our government does not support the inclusion of ISDS clauses in future trade and investment agreements. This place here, our parliament, is the law-making body of this land, and we should be free here in this parliament to respond to the needs and the views of Australians as they arise and as they change. That is exactly what is happening here.

This parliament should not be swayed on the basis of threats of being sued if changes are made to laws that affect foreign investors. When, for example, our parliament wants to legislate to protect the environment, we should not have a concern about being stopped in our tracks because an ISDS clause may mean we have to pay compensation to a foreign company who believes that their interest may be damaged by that case.

As I said, we’ve been really clear that trade agreements can be successfully negotiated without these clauses and in our interests. If we look at the two most recent free trade agreements that our country struck, with the United Kingdom and with India, we see these do not include ISDS clauses. In fact, the beginning of those negotiations were undertaken by those opposite while they were in government; these negotiations do take some years to conclude. It does seem strange that we’re now here debating a motion where the opposition are in fact saying these clauses are essential when, while they were in government, they negotiated trade agreements that support our country without including these clauses. I shouldn’t be surprised that the opposition are once again backflipping on what they did while they were in government. It does seem to be a current theme of what they’re doing. But it is worth noting that that is what they’re doing.

This focus that the opposition are bringing to ISDS just doesn’t make sense. Both the ACCC and the Productivity Commission have highlighted their concerns with ISDS clauses, suggesting that they risk impeding domestic reforms that are actually in the public interest. The Productivity Commission has said that evidence shows that ISDS provisions do not have a ‘significant impact on investment flows.’ The Productivity Commission went on to say that Australia seeking to insert ISDS clauses through trade negotiations and in doing so also trying to seek rights that might be held over foreign governments is just not worth our while and that, instead, there are other avenues that Australian investors could make use of or have in their back pocket rather than ISDS.

We know where clauses like this have been used in the past. It is important that those opposite and those on this side remember the case that Philip Morris brought against Australia over plain packaging of cigarettes. It was a four-year case that, thankfully, ended with that company being put back in its place. But it is a demonstration of how ISDS clauses can be used to interfere with the work of parliament and the intentions of parliament. The disruption that ISDS enabled Philip Morris to cause to a health measure that was supported by experts, was nondiscriminatory and was based on substantial research goes to show how these clauses can be used against the interests of government, parliament and, in fact, our country. We shouldn’t see further actions in this vein.

This government is absolutely committed to supporting Australian businesses and trade. It is vital to our national interest. We will continue to do that while also working to avoid empowering foreign companies who might try, just as Philip Morris tried, to get in their way to the detriment of Australians and the public good.

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