Trade practices may allow international organizations to suppress the rights of governments in the Global South. This is a message from the Colombian government, which describes the results of the trade as “.to shed blood” because of the sovereignty of their country. And now, Colombia President Gustavo Petro said he wants to renegotiate the agreements his country has with the United States, the European Union and the United Kingdom.
They have a strong case because, in the last few years, the US and European countries have been negotiating similar trade agreements, while trying to prevent themselves from being arrested in the hidden “corporate courts” that they create.
Only this year, the British government withdrew from the dangerous economic agreement, known as the Energy Charter Treaty, after several cases in which European governments were sued by fossil fuel companies for climate action that is expected to damage the profits of businesses.
So the question now is whether the European countries will accept that the countries of the South need the same place to deal with climate change and many other problems they face. Or they would want these countries to continue with these terrible, one-sided agreements.
At the heart of the problem is something known as investor-state conflict settlement or ISDS. Essentially, ISDS creates an “industrial court”, which allows multinational corporations from trading partners to sue governments in an international court.
These “corporate courts” have been introduced into commercial and financial activities since the 1950s, originally dreamed up as a way to protect the interests of whites in developing countries. He created a legal system that would have made it difficult for governments that wanted to, say, promote oil fields owned by Western countries. So, from the beginning, these agreements were neocolonial.
But over time, these company court lawyers were expanded by company lawyers. Today, corporations can sue for laws or regulations they don't like. Worse, these cases are often heard in private, being overseen by corporate lawyers who do not have to worry about the consequences of their decisions on society, human rights or the environment – only money laws. And these “courts” usually do not have the right to complain, and can be used by foreign investors.
Therefore, ISDS has been used by the tobacco industry to challenge governments that want to ensure that cigarettes are sold in plain packaging. It has been used to oppose increases in the minimum wage and subsequent taxes. But more and more, they are being used to challenge all kinds of environmental laws needed to stop climate change. Instead, they are becoming a major barrier to the climate action that governments must take to make our world sustainable.
Therefore, Western countries are receiving hundreds of millions of dollars from corporations, just for doing their democratic work. Unsurprisingly, they are canceling the contracts that put them in this situation. But they do not want to allow other governments to do the same. One rule for us, another for the Global South.
The Colombian government has decided to call this scam and take matters into its own hands. President Petro has said that allowing organizations to settle disputes outside the national courts should not be done, saying that instead Colombia is forced to “put itself in the mouth of the wolf”.
He is right. In the last ten years, 23 famous cases have been brought to Colombia under ISDS, many of them filed by foreign mining companies in direct response to the measures taken by Colombia to protect the environment and the rights of indigenous peoples.
For example, a major mining company called Glencore sued Colombia following a decision by the country's Constitutional Court to suspend the expansion of what is already the largest coal mine in Latin America.
The Cerrejon mine has faced fierce local opposition and has resulted in air, soil and water pollution and the displacement of 35 indigenous people from their ancestral lands. The Constitutional Court decided that the expansion of the mine would seriously disturb the environment of the local people.
Glencore said the court's decision was arbitrary, capricious and biased, and used ISDS to bring four cases against Colombia. It won the first case and was awarded $19m, while the other three are still working on an undisclosed amount.
In other news, Canadian mining company Eco Oro is seeking $696m in damages after the Supreme Court ruled to protect paramos – rare, marshy areas that serve as important sources of freshwater. Although the proposed ISDS system is supposed to ensure that governments have a place to protect the environment, the arbitration panel said that the environmental distinction does not preclude the obligation to provide compensation.
Colombia is not alone. In recent years countries including Kenya, South Africa and Ecuador have begun to emerge from this undemocratic system. One of the first agreements that Colombia wants to renegotiate is the UK-Colombia agreement. Colombia's ambassador to the UK criticized the agreement, saying that the agreements “contradict Colombia and many other countries”, especially showing the power they give to oil companies to fight back against climate change and build countries. “for not getting what he wanted to get by polluting”.
But he will be strongly criticized. This means that they will need help from citizens and transport here in Britain. Fortunately, the trade union of civil servants who work for the UK government to negotiate trade has already come out in support of Colombia's position, saying “we need real climate action”.
We have to have them. ISDS is an arcane system, but in recent years campaigners have pulled it out of the shadows and begun to address it in many trade deals. Seventy years after the neocolonial system began, we can defeat it. And if we want to stop climate change and build democracy we have to do it fast. Colombia is now at the forefront, and it needs our help.
The views expressed in this article are those of the author and do not reflect Al Jazeera's influence.