A journalistic outfit that has shed light on a dramatic turn in a multibillion dollar cross-border environmental lawsuit is being shut out of key proceedings that start on Monday in Washington.
Courthouse News had asked the Netherlands-based Permanent Court of Arbitration (PCA) to attend the roughly three week long “secret tribunal hearings” in a case involving Ecuador and Chevron.
“The Parties to this arbitration have not ‘agreed otherwise’,” Martin Doe, the senior legal counsel for the court replied, referring to dispute settlement transparency rules in a letter. “In the circumstances, there can be no public access to the hearing.”
Noting that some international trade agreements force feuding parties to hold public hearings, Doe pointed out that an open dispute resolution process “is not the position under the USA-Ecuador Bilateral Investment Treaty.”
The Dutch body is involved in the matter “pursuant to the Treaty between the United States of America and the Republic of Ecuador,” according to a statement on its website.
The denial to Courthouse News, who have been supported in their endeavor for sunlight by The Reporters’ Committee for the Freedom of the Press, was the latest flashpoint in increasingly common disputes over how trade agreements are enforced—arguments that are set to spill over onto Capitol Hill in the next few weeks, as Congress considers President Obama’s trade agenda.
On Thursday, Senate Finance Committee leadership announced a bipartisan compromise on Trade Promotion Authority—so-called fast-track legislation that would pave the way for a slew of multilateral deals, including the Trans-Pacific Partnership, the Transatlantic Trade and Investment Partnership, and the Trade In Services Agreement.
Whether it passes the Senate, the measure is expected to die in the House unless 35 Democrats change their minds, The Hill reported on Tuesday.
Explaining one of the reasons Congress is suspicious of the Obama administration’s trade agenda in a Feb. 25 Washington Post op-ed, Sen. Elizbaeth Warren (D-Mass.) denounced the investment state dispute settlement mechanism of the TPP, writing that it will “tilt the playing field in the United States further in favor of big multinational corporations.”As its name indicates, the arbitration panels are only open to petitions from investors.
“The use of ISDS is on the rise around the globe,” she also noted. “From 1959 to 2002, there were fewer than 100 ISDS claims worldwide. But in 2012 alone, there were 58 cases.”
According to a leaked copy of the draft TPP dated from Jan. 20, the investor-state arbitration panels under the agreement would be forced to “conduct hearings open to the public.” The order, however, notes a major exemption for “information that is designated as protected”–one that could see judges “closing the hearing for the duration of any discussion of such information.”
The Obama administration’s top trade negotiator Michael Froman has acknowledged, without specifying, that “abuses of the investor-State [sic] dispute settlement…have happened under agreements negotiated by other countries.”
The ongoing dust-up between Ecuador and Chevron stems from a 2011 verdict finding the oil conglomerate liable for environmental damages to the tune of $19 billion. In 2013, Ecuador’s Supreme Court reduced that penalty to $9.5 billion.
In 2014, US District Judge Lewis Kaplan in New York enjoined Ecuador from enforcing the decision, accusing Quito’s American-led legal team of fraudulently influencing the outcome of the case. The man at the heart of those allegations, Steven Donzinger, and other lawyers are appealing the verdict on Monday.
In the meantime, the dispute has been continuing through the PCA. While most of the proceedings remain secret, Courthhouse News has reported since February that a forensic analyst’s investigation submitted under seal to the PCA in The Hague found “no evidence” to support a key conclusion issued by Lewis—that an Ecuadorean judge who ruled against Chevron in 2011 had signed an order drafted by someone else.
