09 November 2015
by Gareth Hutchens

Australia 'could be sued for billions' by foreign companies under TPP

Signatories to the TPP include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam.

A leading expert on intellectual property has warned that Australian governments could be sued for billions of dollars by foreign companies under a controversial clause in a huge multilateral trade deal.

We could get sued for billions for making some change to mining law or fracking law or God knows what else.
Associate Professor Kimberlee Weatherall

The text of the long-awaited Trans-Pacific Partnership (TPP) - a historic 12-country trade agreement between Pacific region nations, including Australia and the United States - was finally released.

It is the first time voters have had a chance to see what the Australian government has been negotiating on their behalf for more than five years.

Trade Minister Andrew Robb says authorities released the text in "record time" to give people the time to consider its details.

But one of Australia's leading intellectual property experts, Associate Professor Kimberlee Weatherall, from Sydney University's Law School, has criticised a clause in the agreement that gives foreign companies the right to sue Australian governments for introducing laws they say have harmed their interests.

Ms Weatherall has also questioned the adequacy of the "carve outs" Mr Robb says he won that will supposedly make it difficult for foreign companies to sue under certain circumstances.

"The Intellectual Property (IP) chapter of the TPP is an extraordinarily complex, extremely prescriptive chapter that locks in IP settings established decades and even a century ago – at the very time that the Productivity Commission is looking critically at Australia's entire IP arrangements," Ms Weatherall said.

"[And] the adequacy of carve-outs for IP in the Investment Chapter is extremely concerning."

"We could get sued for billions for making some change to mining law or fracking law or God knows what else. We could literally have damages of more than a billion, but we don't actually know. And we won't know until any [law] suit gets started, and then we won't know for another five years while it works through the process.

Ms Weatherall's criticism follows others such as Dr Matthew Rimmer, intellectual property law professor at the Queensland University of Technology, who says the section on foreign investors is "labyrinthine".

But Mr Robb hit back at critics on Friday, saying they are doing themselves a disservice by criticising the text so quickly.

"Within 20 minutes [of the release] there were predictable people ringing media outlets giving so-called expert opinions," he told ABC radio on Friday.

"They don't do themselves any sort of justice by jumping at shadows and peddling lines they've been peddling for years without looking at what's been negotiated."

An ISDS clause has been used in the past by a foreign tobacco company to sue Australia's government.

When former prime minister Julia Gillard introduced plain-packaging laws in 2012, tobacco company Philip Morris used the ISDS clause in the Hong Kong-Australia bilateral investment treaty to sue, and the case is still in arbitration.

Last month in a foreign trade ministers meeting in the United States, US President Barack Obama proposed including an ISDS clause in the TPP with an exception that tobacco companies could not use it to weaken or overturn laws designed to curb tobacco use.

The proposal was crucial in getting Mr Robb's agreement, which helped seal the deal.