Skip to content

Trudeau may agree to drop ISDS in NAFTA! Please sign our petition before February 26

The Council of Canadians has opposed the investor-state dispute settlement (ISDS) provision in NAFTA since the early-1990s.

This provision allows a corporation based in one country to sue the government of another country – in a non-transparent tribunal process rather than through established domestic courts – for lost future profits resulting from public interest legislation, most commonly laws that protect the environment.

Now, Inside US Trade reports, “During a meeting with their U.S. counterparts this week, Canadian negotiators will pitch the elimination of the deal’s investor-state dispute settlement provision — and the U.S. is expected to agree to that proposal, allowing for what private-sector and congressional sources called a ‘win’ for U.S. Trade Representative Robert Lighthizer in one of his priority areas in the talks.”

The 7th round of NAFTA talks is expected to formally begin in Mexico City on February 26 and run through to March 6.

It would appear that the Trudeau government has tried in various ways to maintain some form of the ISDS system in (or alongside) NAFTA.

The Trudeau government had initially proposed an investment court system (which has been criticized as not significantly different than the investor-state dispute settlement provision), then tabled an offer during the 6th round of talks in Montreal to maintain the ISDS system just between Canada and Mexico.

Inside US Trade notes, “A private-sector source speculated that Canadian negotiators were willing to abandon ISDS in NAFTA because ‘they probably realize they will never get their investment court’ [after that] proposal did not gain traction with the [United States Trade Representative].”

News reports also suggest that while Lighthizer didn’t reject the proposal that Canada and Mexico opt-in to a Chapter 11 mechanism, there is no suggestion he accepted it either. The report that the Trudeau government may now abandon ISDS would suggest Lighthizer was cool to the proposal (or that Canada and Mexico may still intend to set up a separate ISDS provision outside of NAFTA).

Please sign this Council of Canadians online petition for a last major push on the Trudeau government to drop the ISDS provision before the 7th round of talks start on February 26.

Note: Politico now reports, “NAFTA negotiators will gather this week in Washington [before the 7th round of talks begin in Mexico City] to try to work on the issue [of investment protection]. Despite some rumors that Canada was coming to the table with a plan [to eliminate the investor-state provision] that is favored by the U.S., officials say Ottawa will be pushing for the [investment court system proposal]. …The assertion comes after business and congressional sources told POLITICO on Tuesday that Canada was weighing a proposal that would rid NAFTA entirely of the dispute settlement procedure. …[Adam Austen, a spokesman for Canadian Foreign Minister Chrystia Freeland says] ‘If the U.S. maintain their current position and still intend to opt out of ISDS, Canada and Mexico will focus their efforts on a bilateral and progressive ISDS mechanism in the context of NAFTA.'”