President Trump’s top trade negotiator won’t seek to reject mechanisms in trade deals that offer legal recourse only to investors and multinational corporations.
Robert Lighthizer said that the administration “would not commit that we’re going to get rid of” investor state dispute settlement (ISDS) panels, when asked on Wednesday by Sen. Sherrod Brown (D-Ohio).
“There is a negotiating objective, as I understand it, that we’re going to strengthen ISDS,” the US Trade Representative told Brown, possibly referring to negotiation authority legislation passed by Congress in 2015.
Brown asked specifically about “removing ISDS” in the North American Free Trade Agreement (NAFTA), which the Trump administration is set to start renegotiating later this year with Canada and Mexico.
Lighthizer said he was concerned about foreign entities using ISDS to impact domestic laws, and promised to work with Congress to address concerns about the panels. But he did see value to the arbitration bodies, which can only be petitioned by private business interests.
“Clearly our investors have a right to have their property protected,” the USTR said. “On the other hand, there are, in my judgment, at least sovereignty issues.”
Sen. Brown responded by arguing that any concerns about property rights can be addressed through other means.
“This is not about expropriation,” Brown said. The lawmaker argued that dispute mechanisms “don’t need to go to the place where foreign corporations can challenge US environmental laws and consumer protection laws and other sovereignty.”
During last year’s campaign, President Trump railed against multilateral trade deals like NAFTA being unfavorable to workers, but he did not focus any of his criticism on ISDS.
