Alice-Mary Higgins (Independent) | Oireachtas source

These amendments will be key to the success of this legislation. There was a narrative early in year that it was investor court systems versus the climate Bill, and that there is a trade-off. We must be clear that investor court systems are what will undermine the climate Bill in the context of it actually succeeding. Those of us who are passionate about climate action want to make sure that we do not create a giant hostage to fortune that will have an impact beyond the area of climate action.It will affect lots of policy areas that many people care about, from public health through to housing.

In the context of the Bill, I will speak specifically to the liabilities to investors. It relates to section 4 of the Bill, which provides for the limitation to liability that I discussed with the Minister on Committee Stage. It is a most concerning provision. Section 4 effectively closes the access to compensation and damages to those who will be impacted, for whatever reason - we will come to that later - when then Government decides that it is not going to implement or follow through on the commitments made in this Bill.

We see the damage caused by climate change. We see how quickly entire towns can be lost. It is a concerning issue. Of course, people will still have access to the courts, but it is concerning that access to compensation and damages in the courts will be limited for the citizens of Ireland and their communities. That is happening in parallel with a push to open Ireland up to compensation claims in a brand new form of arbitration. I know it is not led by the Minister, but it is led by the Government. I hope that it will be reconsidered over the summer. It must be reconsidered. It is an issue that a number of committees will consider. There is a push to open Ireland up to compensation claims in a brand new form of arbitration. As Senator Warfield said, while a claim by a fossil fuel company to slow down our action on renewable energy may not succeed in a national court because that court will balance the claim against all of the other imperatives and laws that we make, an investor arbitration court will only consider the question of fair and equitable treatment, legitimate expectations, the disappointment of those expectations of profit, and all of those factors. That is what the investor arbitration court is considering when it is deciding a case.

In the context of the Bill, I will speak specifically to the liabilities to investors. It relates to section 4 of the Bill, which details the limitation of liability that I discussed with the Minister on Committee Stage. It is a really concerning provision. Effectively, section 4 closes the access to compensation for damages to those who will be impacted for whatever reason - we will come to that later - when the Government decides that it is not going to implement or follow through on the commitments made in this Bill. We see the damage done by climate change. We see how quickly entire towns can be lost. Of course, people will still have access to the courts, but it is most concerning that access to compensation and damages will be limited in the courts for the citizens of Ireland and their communities. That is happening in parallel with a push to open Ireland up to compensation claims in a brand new from of arbitration. I know it is not led by the Minister, but it is led by the Government. I hope that it is being reconsidered and will be so over the summer. It must be reconsidered. It is an issue which we are going to be looking at in a number of committees. There is a push to open Ireland up to compensation claims in a brand new from of arbitration. As Senator Warfield said, while a claim by a fossil fuel company to slow down our action on renewable energy - while a claim indeed may not succeed in a national court - because that national court is balancing it against all of those other imperatives and laws that we make, an investor arbitration court is only looking to the question of fair and equitable treatment, legitimate expectations and the disappointment of those expectations of profit and all of those factors. That is what they are considering when they are granting a case.

CETA states that the mere fact of regulation does not entitle a company to compensation. However, it is the mere fact plus the expectations the company had and the inducement. It must be noted that even the giving of planning permission or the holding of a meeting with the Minister could be regarded as an inducement. The term "inducement" is widely interpreted. We hear many terrible horror stories from around the world of compensation cases costing billions. Those are the exact same grounds on which companies have taken cases and won billions. The fair and equitable treatment ground and all of those factors I mentioned are the exact same grounds that are contained in this new agreement and in the new proposed investor court system, ICS. That is why it is a matter for concern. My hope is that the Government will not ratify it. If it does ratify it, it should at least put in some protective measures to try to strengthen its hand when it does go to negotiate or fight an investment claim for compensation.

When I spoke to the Tánaiste and Minister for Enterprise, Trade and Employment on this issue, I was disappointed to learn that he had not completed a risk analysis on the ICS under CETA. He did not think it was necessary because he did not expect that Ireland would ever treat a company unfairly. It must be borne in mind that what we see as unfair and what a company sees as unfair are very different. It may well be that a company that is impacted by what we understand to be a necessary climate measure taken under this Bill, will look for compensation and it may well get it. The very fact of it taking that case will cost us hundreds of millions of euro in legal costs.

What Senators Warfield, Boylan and others are asking the Minister to do is to try to future-proof this legislation against those dangers and include in it measures that will protect or at least give a basis for protection to the State in relation to those kinds of claims. Cases taken under the ICS of CETA would be extremely wide, but we are already vulnerable, as the Minister is aware, to claims for compensation, specifically by fossil fuel companies, under the energy charter treaty. The European Commission is talking about why we would leave the energy charter treaty if it were not for the 20-year exit clause. It is the same 20-year exit clause, by the way, that is going to be attached to CETA.The Energy Charter Treaty allows companies to take cases and they are doing so.

As has been described, companies succeeded in having climate law and climate policy diluted in France in this way. In Germany, companies are suing for millions and billions. Right across Europe, companies are actively litigating for compensation and putting price tags on climate action which are slowing it down and delaying the change we need. I have my own amendments on this topic, to which we will come later, with specific regard to petroleum, gas and oil licences. The Minister will be aware that we will also be discussing liquefied natural gas, LNG. It would be useful if the Minister could either confirm or deny that the energy charter treaty is being considered in the drafting of policy because it seems that we are greatly exposed. If these amendments were to be accepted, it would represent some small degree of future-proofing against the CETA investor court system's impact on climate action. It might also provide us with some protection in respect of claims under the energy charter treaty because we would be sending a clear signal that there should not be an expectation. These clauses in respect of liability are very important.

I spoke about a disconnect in terms of limiting our liability to citizens while opening our liability to companies, by which I mean international corporations. It is predominantly such corporations that use these tribunals. It is important to note that small and medium enterprises in Ireland would not be able to use these courts if they were impacted by either climate action or the failure to take climate action. As persons under this provision, they would also be excluded from gaining any compensation from the State. They would also not be able to get compensation in these investor courts, which are only open to international investors. That is just the legal and financial context of this Bill. These amendments propose very sensible protective measures to strengthen our hand so that we can steer these climate goals through and steer the State towards the actions it needs to take without unnecessary dangers.