Date: Tue, 27 Jan 1998
From: Andrea Durbin <[EMAIL PROTECTED]
In the next few weeks, the political representatives for the OECD
countries will be meeting (the week of February 16th) to decide
whether to:
a) proceed with the negotiations for the MAI or
b) to scrap the agreement altogether. Groups around the world
are gearing up to increase the pressure nationally and
internationally that the MAI should be dropped.
Below is a joint NGO statement that was released in Paris during the NGO
consultation meeting with the OECD last October. We are asking groups to
endorse this statement so that we can re-release it internationally with
more signatures the week of February 9th.
If your organization can endorse this statement, please send me your
ORGANIZATION NAME AND COUNTRY by Friday, February 6th.
Also, please circulate this message broadly to other networks you work
with.
Thanks in advance for your help. Keep up the fight against the MAI. Its
defeat could be the next blow to the globalization agenda!
Regards, Andrea Durbin, Friends of the Earth, US
*************************
JOINT NGO STATEMENT ON THE
MULTILATERAL AGREEMENT ON INVESTMENT (MAI)
NGO/ OECD Consultation on the MAI
Paris: 27 October, 1997
INTRODUCTION
As a coalition of development, environment and consumer groups from around
the world, with representation in over 70 countries, we consider the draft
Multilateral Agreement on Investment (MAI) to be a damaging agreement which
should not proceed in its current form, if at all.
There is an obvious need for multilateral regulation of investments in view
of the scale of social and environmental disruption created by the
increasing mobility of capital. However, the intention of the MAI is not to
regulate investments but to regulate governments. As such, the MAI is
unacceptable.
MAI negotiations began in the OECD in the Spring of 1995, more than two
years ago, and are claimed to be substantially complete by the OECD. Such
negotiations have been conducted without the benefit of participation from
non-OECD countries and civil society, including non-governmental
organizations representing the interests of workers, consumers, farmers or
organizations concerned with the environment, development and human rights.
As a result, the draft MAI is completely unbalanced. It elevates the rights
of investors far above those of governments, local communities, citizens,
workers and the environment. The MAI will severely undermine even the meagre
progress made towards sustainable development since the Rio Earth Summit in
1992.
The MAI is not only flawed in the eyes of NGOs, but conflicts with
international commitments already made by OECD member countries:
The MAI fails to incorporate any of the several relevant international
agreements such as the Rio Declaration; Agenda 21; UN Guidelines for
Consumer Protection (1985); the UNCTAD Set of Multilaterally Agreed
Principles for the Control of Restrictive Business Practices (1981); and
the HABITAT Global Plan of Action.
The MAI fails to comply with OECD commitments to integrate economic,
environmental and social policies (1).
The MAI removes responsibilities on transnational enterprises which were
previously agreed by the OECD under the OECD Guidelines for Multilateral
Enterprises 1976 (2).
The exclusion of developing countries and countries in transition from the
negotiations is inconsistent with OECD policy on development partnerships
(3).
Problems with the MAI stem both from the broad restrictions it places on
national democratic action, and from its failure to include sufficient new
systems of international regulation and
accountability.
As the MAI stands, it does not deserve to gain democratic approval in any
country. All the groups signing this statement will campaign against its
adoption unless changes, including those cited below, are incorporated into
the body of the MAI.
SUBSTANTIVE CONCERNS
As drafted, the MAI does not respect the rights of countries - in particular
countries in transition and developing countries - including their need to
democratically control investment into their economies.
The level of liberalisation contained in the MAI has already been opposed as
inappropriate by many developing countries. However, non-OECD countries are
under increasing pressure to join.
There are differing investment and development needs of OECD and non-OECD
countries. In particular, the potential for economic diversification and
development of the developing countries - especially the least developed
countries - and countries in transition would be severely undermined by the
provisions of the MAI. The standstill principle would cause particular
problems for countries in transition, many of which have not yet developed
adequate business regulation.
The MAI's withdrawal provision would effectively bind nations to one
particular economic development model for fifteen years; prevent future
governments from revising investment policy to reflect their own assessment
of the wisest economic course; and force countries to continue to abide by
the agreement even if there is strong evidence that its impact has been
destructive.
The MAI contains no binding, enforceable obligations for corporate conduct
concerning the environment, labour standards and anti-competitive behaviour.
The MAI gives foreign investors exclusive standing under a legally binding
agreement to attack legitimate regulations designed to protect the
environment, safeguard public health, uphold the rights of employees, and
promote fair competition.
Further, citizens, indigenous peoples, local governments and NGOs do not
have access to the dispute resolution system, and subsequently can neither
hold multinational investors accountable to the communities which host them,
nor comment in cases where an investor sues a government.
The MAI will be in conflict with many existing and future international,
national and sub-national, laws and regulations protecting the environment,
natural resources, public health,
culture, social welfare and employment laws; will cause many to be repealed;
and will deter the adoption of new legislation, or the strengthening of
existing ones.
The MAI is explicitly designed to make it easier for investors to move
capital, including production facilities, from one country to another;
despite evidence that increased capital mobility disproportionately benefits
multinational corporations at the expense of most of the world's peoples.
WE CALL ON THE OECD AND NATIONAL GOVERNMENTS TO:
With regard to substantive concerns:
1) Undertake an independent and comprehensive assessment of the social,
environmental, and development impact of the MAI with full public
participation. The negotiations should be suspended during this
assessment.
2) Require multinational investors to observe binding agreements
incorporating environment, labour, health, safety and human rights
standards to ensure that they do not use the MAI to exploit weak
regulatory regimes. Ensure that an enforceable agreement on investor
responsibilities takes precedence over any agreement on investor
rights.
3) Eliminate the investor state dispute resolution mechanism and put into
place democratic and transparent mechanisms which ensure that civil
society, including local and indigenous peoples, gain new powers to
hold investors to account.
4) While none of the undersigned NGOs object to the rights of investors
to be compensated for expropriation by a nation state, there are
adequate principles of national law and jurisprudence to protect
investors in circumstances such as these. The current MAI exceeds
these well accepted concepts of direct expropriation, and ventures
into areas undermining national sovereignty. We therefore request that
OECD members eliminate the MAI's expropriation provision so that
investors are not granted an absolute right to compensation for
expropriation. Governments must ensure that they do not have to pay
for the right to set environmental, labour, health and safety
standards even if compliance with such regulations imposes
significant financial obligations on investors.
With regard to process concerns:
1) Suspend the MAI negotiations and extend the 1998 deadline to allow
sufficient time for meaningful public input and participation in all
countries.
2) Increase transparency in the negotiations by publicly releasing the
draft texts and individual reservations and by scheduling a series of
on going public meetings and hearings in both member and non member
countries, open to the media, parliamentarians and the general public.
3) Broaden the active participation of government departments in the
official negotiations beyond state, commerce and finance to a broader
range of government agencies, ministries and parliamentary committees.
4) Renegotiate the terms of withdrawal to enable countries to more easily
and rapidly withdraw from the agreement when they deem it in the
interest of their citizens. Developing countries and countries in
transitions which have not been a party to the negotiations must not
be pressurised to join the MAI.
CONCLUSION
The current MAI text is inconsistent with international agreements signed
by OECD countries, with existing OECD policies, and with national laws to
promote sustainable development. It also fails to take into account
important work carried out by investment experts and official bodies such
as the UNCTAD "development friendliness" criteria for investment
agreements (4) and other work on investor responsibility.
If the OECD policy statements are to have any meaning, the above
provisions must be fully integrated in the MAI with the same legal force
as those on economic liberalisation.
Given our grave concerns about the MAI and the unrealistically short time
frame within which the MAI is being concluded, we look to the OECD and
its member governments to fundamentally reconsider both the process and
substance of the draft agreement. We call on the OECD to make a specific
and detailed written response to our concerns. We also call on the OECD
to avoid talking publicly about its consultations with NGOs without also
talking about the serious concerns raised at those consultations.
Finally, we will continue our opposition to the MAI unless these demands
are met in full.
Notes:
(1) OECD Ministerial Communique May 1997
(2) OECD Code of Conduct for Multinational Enterprises, Paris 1992
(3) "Shaping the 21st Century: The Contribution of Development
Cooperation", OECD 1997. (4) UNCTAD, World Investment Report 1997;
UNCTAD Expert Meeting," Development Friendliness Criteria for
Investment Frameworks", 1997.
.......................................
List of 65 Non-governmental organisations supporting this statement
not included with this message.
Many of you saw this message when it first came out in October.
It is relevant now because your government must decide this week
whether or not to continue negotiations in Paris on Feb 9, 1998
