CAP calls on government to make no concessions in forthcoming TPP meetings

Obama’s visit did not give any new assurance that Malaysia’s demands will be met

CAP is concerned that despite the lack of any signs that the United States of America is able to guarantee it can stand by any deal made in the Trans-Pacific Partnership Agreement (TPPA), the negotiations on the TPPA are going full steam ahead these next two weeks.

CAP understands that there will be a meeting of negotiators including the Chief Negotiators of TPPA countries to be held in Vietnam on 12 – 15 May 2014, to be possibly followed by a Ministerial meeting in Singapore on 19 – 20 May 2014.

We urge the Malaysian government to stand firm on all its positions during these two meetings and indeed to strengthen its positions further, in line with the Red Lines on the issues which civil society organisations including CAP have drawn up and submitted to the Government.

The recent visit of United States President Barack Obama does not give us any assurance that the US is willing to agree to Malaysia’s positions on ‘problem issues’ as identified either by the Government or by the NGOs.

The significant US Congressional opposition to fast track authority means that whatever positions his Administration signs up to in an agreed TPPA text can be opposed and undone by Congress.  Thus what the US Administration seems to agree to in the TPPA is not their final position, and other countries including Malaysia are likely to be asked to make even more concessions.

We understand that at the negotiators’ meeting in Vietnam, the issues likely to be negotiated include intellectual property (IP), investment, state owned enterprise (SOEs), environment, e-commerce and possible exceptions for tobacco control.   Each of these issues is very sensitive in which there are high stakes for Malaysia.  The Prime Minister and the Minister of International Trade and Industry as well as other relevant Ministers and senior officials must therefore require our negotiators to stand firm or even strengthen the country’s existing positions, and not make any new concessions.

The following are some of CAP’s positions on the issues coming up for negotiation in Vietnam (as well as any Ministerial meeting following that).

• On intellectual property (IP), Malaysia should reject proposals to:

• join additional international IP treaties that strengthen IP protection

• allow patents for new uses of an existing medicine or other  technology

• lengthen the patent term for medicines,

• have data exclusivity rules that delay our ability to produce or import generic medicines,

• link the health authorities’ approval for marketing of medicines to their patent status

• increase IP protection on agricultural inputs as it would go against Malaysia’s law on plant variety protection and disadvantage our farmers by raising the cost of their inputs.

• extend the copyright term to at least 70 years (from the present 50 years).

The result of accepting these would be that consumers’ rights and access to affordable medicines and to information and knowledge will be harmed, and farmers’ rights to seeds would also be hurt.

• On state owned enterprises, Malaysia should reject the whole section, which aims at making it difficult or impossible for most of our government-linked companies to operate or survive. Otherwise it should demand that the country is exempted from having to comply with this SOE section.  One of the provisions is that these SOEs cannot give preference to local goods, services or companies in their procurement of goods and services.  Abiding by this will lead to a lot of the business of SOEs to be given to foreign companies, which will have serious effects on local businesses, including Bumiputras.  This must be rejected by Malaysia.

• In the e-commerce chapter, Malaysia should reject any proposals that require it to allow ‘free flow of information’ to foreign countries, or to ban national requirements to store information only on domestic servers.  Such proposals could facilitate easier intelligence gathering and spying by foreign governments, a practice that has been recently revealed by media reports.

• In the investment chapter, Malaysia must reject pre-establishment rights for foreign companies of TPPA countries as well as proposed restrictions on performance requirements (or conditions) placed on foreign companies.  In the draft text, countries are allowed to exempt ‘non conforming measures’ from some obligations but other key obligations are not exempted and thus the ‘exemptions’ are of little use. Thus Malaysia should insist that these non-conforming measures must be exempted from all investment chapter obligations.  Malaysia must also reject any provisions that prevent the country from using capital controls that may be required to regulate the flow of funds into and from the country.

• Malaysia should also reject provisions relating to the ‘investor protection’ component of the TPPA.  In particular, we should reject the provisions on ‘fair and equitable treatment’ and ‘indirect expropriation’ as these greatly constrain our policy space and expose the country to legal liability.

• Malaysia must also reject the investor-to-state dispute settlement (ISDS) system in the investment chapter which enables the foreign investor to take the government to an international arbitration tribunal to enforce the provisions in the investment chapter and provisions of other chapters which are referred to in the investment chapter. This exposes the government to claims of billions of dollars.

• Malaysia must stand firm on its proposal for a total exclusion or total carve-out for tobacco control measures from the whole TPPA.

• In the environment chapter, Malaysia should not be required to change its position in environment treaty negotiations especially the Convention on Biological Diversity or the United Nations Framework Convention on Climate Change.

• Malaysia should also insist that it (and other TPPA countries that request it) should obtain exceptions in all TPPA chapters that allow it to adopt or maintain measures that it deems it needs for purposes of public health, the environment, economic and social development and other public interest policies.

We also reiterate our request to the Government to provide more concrete and detailed information to the Malaysian public on the negotiations that are taking place.  So far the information has been very limited and sketchy and the public is in the dark on what issues are being negotiated and what Malaysia’s positions are.  This is despite the consultations that Ministry of International Trade and Industry have been holding.

The red lines that CAP has raised above are because the Malaysian government is still going ahead with the negotiations.  We still stand by our earlier position that Malaysia should withdraw from further negotiations and not sign the TPPA.

Letter to the Editor – 8 May 2014