CPTPP: The five countries that won't sue NZ, according to the Government

  • 09/03/2018

New Zealand has signed agreements with five of the 11 CPTPP countries that exclude investor-state dispute settlement provisions (ISDS).

The ISDS provisions, common in trade agreements, allow foreign investors to sue countries if they believe they are not being treated fairly. They also protect multinationals, such as the big oil companies, from being nationalised.

New Zealand has had ISDS clauses in agreements with 13 countries over the past 27 years, and has never been sued.

Despite that, opponents of the CPTPP - the Comprehensive and Progressive Trans-Pacific Partnership - and its predecessor the TPP used ISDS as their main focus, claiming New Zealand was "selling its sovereignty".

Labour, opposed the ISDS clauses in the TPP and tried to get them removed when it was renegotiated.

The result of that has been five agreements, called side letters, with five of the CTPP countries - Australia, Brunei Darussalam, Malaysia, Peru and Vietnam.

Australia accounts for 80 percent of foreign investment in New Zealand.

Trade Minister David Parker signed the side letters on Friday at the CPTPP signing ceremony in Santiago, Chile.

He says there is now very little risk of New Zealand being sued.

"We haven't been able to get every country on board, but signing letters with this many CPTPP partners is a real achievement," he said.

Each of the agreements differs.

"Some exclude the use of ISDS between New Zealand and other countries entirely, while other side letters allow for arbitration to proceed only if the relevant Government agrees," said Mr Parker.

Two other countries - Canada and Chile -  have joined New Zealand in a declaration that they will use investor-state dispute settlement responsibly.

NZN / Newshub.