CIJ Bertha Fellows Warn of Obscure Courts Eroding Democracy

    A long-form article published in the Guardian, following an intensive investigation by CIJ Bertha Fellows Claire Provost and Matt Kennard, exposes the threat to democracy from a little-known legal process.

    Their research highlights the secretive arbitration systems tied into the majority of trade and investment treaties, such as the Transatlantic Trade and Investment Partnership (TTIP) currently being negotiated between EU member states and the US. These systems allow multinational corporations to bring cases against the states they invest in when legislation by the state does not follow the interests of their profit margins. 

    These companies are able to claim not just for lost investment, but also for 'projected profits', effectively claiming their investment and its return directly from the taxpayers of the host nation. Much of this legislation, from environmental regulation to redistributive social policy, is introduced through popular democratic processes, but the Investor-State Dispute Settlement regime is being allowed to undermine the sovereignty of elected governments across the globe.

    Provost and Kennard saw evidence that increasingly this process is affecting the very way in which states debate legislation, as the risk of future arbitration proscribes certain directions and restricts the already narrow policy windows available.

    Perhaps the most disturbing trend reported though, is the growing industry speculating on the success of these cases, as evidenced by the ability of some corporate claimants to secure loans from third-party financiers, using their dispute as collateral even before any claim has been settled.

    Read our Bertha Fellows full piece in the Guardian The obscure legal system that lets corporations sue countries.