Make no concessions in TPPA meetings

The Consumers Association of Penang (CAP) is concerned that the Trans-Pacific Partnership Agreement (TPPA) negotiations are going full steam ahead.

There will be a meeting of negotiators including the chief negotiators of TPPA countries to be held in Canada from 3-12 July, 2014. We urge the Malaysian government to stand firm on all its positions during this negotiating round and 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.

We understand that at the round in Canada, the issues likely to be negotiated include intellectual property (IP), investment, state owned enterprise (SOEs) and possible exceptions for tobacco control. Each of these issues is very sensitive in which there are high stakes for Malaysia.

Therefore the Prime Minister and the Minister of International Trade and Industry (MITI) as well as other relevant Ministers and senior officials must 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 Canada.

On intellectual property (IP), Malaysia should reject proposals for stronger IP than the World Trade Organization rules require including to:

— join additional international IP treaties that strengthen IP protection.
— 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 be diminished.

On state owned enterprises (SOE), 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 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 Bumiputeras. This must be rejected by Malaysia.

Malaysia should reject the investment chapter given the problems experienced by other countries who agreed to the same provisions as are in the leaked TPPA investment chapter. However, since it appears to be negotiating this 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.

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.

In the last week, a number of TPPA governments have said that the negotiations can basically be concluded by the end of 2014. Given the TPPA is almost concluded, it becomes even more vital that all TPPA governments provide more concrete and detailed information to the 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 and briefings 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.

Press Release, 1 July 2014