Alice-Mary Higgins (Independent)
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I am keen, with others, I think, to move through the amendments we have. There are a number of very important and pertinent amendments to discuss today. As I am in possession, and before we move to decide on the section, I will make a small correction on the matter that was being discussed when we adjourned. I had said that the International Centre for Settlement of Investment Disputes, ICSID, rules, the older arbitration rules, can be used in relation to the CETA agreement and the Minister had suggested that was only by consent. In fact, that is not the case. They can be used by an investor. The area that requires consent is if the investor wants to use the investor court system, ICS. If one wants to use the new investor court system, that requires the consent of both parties. If the consent of both parties to use the new investor court system is not forthcoming, the investor can choose to use the ICSID convention and the ICSID additional facility rules. The exact opposite is true, therefore. These supposedly better rules will only apply if corporations decide they want to use them, and they will have the discretion to move back. That is made clear under Article 8.23 of CETA, which states that a claim can be submitted under "the ICSID Convention and Rules of Procedure", the "ICSID Additional Facility Rules", the "UNCITRAL Arbitration Rules" or "any other rules on agreement of the disputing parties." It is only where the investor chooses to use these supposedly reformed - I would question that - ICS rules that consent is required from both parties. Otherwise, the investor has full discretion.

We need to be factually clear and accurate that what we are being asked to sign off on in CETA, as well as the fact that it is wide open in other areas of the Bill for any kind of arbitration rules, is a situation where corporations can use those rules of their choice in relation to a decision, and they are not bound, unless they choose to be bound, by any of the very moderate reforms that were made to the ICS. That is just a correction. We will have time to get back into this because we have an amendment in relation to this. That is under Article 8.23.

I will now move to the section and our amendments but that was a fact that was being debated when the debate adjourned.

Thomas Byrne (Meath East, Fianna Fail)
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What the Senator is saying mixes up two things. Insofar as she is arguing that an investor could bring a claim to the ISDS system instead of the CETA tribunal, this would only be possible subject to the relevant consent requirements, that is, that the parties to the dispute consent to submit to an ISDS mechanism. We would have to consent to that. Let me be 100% clear on that.

Regarding Article 8.23 of CETA, what the Senator said is not correct as regards the reference to the ICSID and the UNCITRAL rules in Article 8.23. It is not correct to say that those rules allow investors to go the mechanisms to which she referred. Article 8.23 provides for rules to be applied by the CETA tribunal, subject to the rules in section F and supplemented by relevant rules adopted by the committee on services and investment. This article therefore specifies which procedural rules can be applied by the CETA tribunal and offers choices in this regard, but it is not the case that these cases are going through the old system or that the protections that have been brought in for the old system are somehow gone at the choice of an investor suing the state. That is absolutely not the case and the information the Senator has given the House is not correct.

Alice-Mary Higgins (Independent)
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However, the old ICSID rules, the established rules, can be applied, and all of the multiple examples of poor rulings that we have cited were given under those rules. Those rules can be applied.

Thomas Byrne (Meath East, Fianna Fail)
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It is not an ICSID tribunal, for a start. All of the rules around the right to regulate, the right for the state to do what it wishes in relation to public services, housing and all the public good that a state does, are not in any way impacted by this. This is not a return to the old system. It is simply about applying rules within the new system.Everything else we discussed applies within the new, reformed system of the investor courts. It is factually wrong to state that investors have a choice to go to the old system. That is not the case under the treaty. I am happy to provide this clarification, but we really need to knock this on the head.

Many comparisons have been raised between the old system and the new system. Part of the reason these changes were made was because of concerns raised about the old system. To overcome those concerns, reforms have been put into the new system of investor courts. As the CETA joint interpretative instrument states about the new system, "CETA represents an important and radical change in investment rules and dispute resolution." Putting forward in the Seanad that, somehow, there is a way around that is just not correct. It is simply factually incorrect.

Alice-Mary Higgins (Independent)
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I will move on from this issue, but it is clear that the ICSID rules can apply. Whether or not it is in the same tribunal, the issue is under which rules it is being applied.

The other issue here is that there is nothing in the legislation the Minister of State is proposing that ties us to the ICS. This is not solely about CETA or Chile. It is about any deal that might be signed under any arbitration rules. We need to be very clear for the House and the record that there is nothing in this legislation which ensures that these cases would be taken under the ICS rules. Regarding the language about being fair and equitable, and all of that, this is the same language and the same kinds of criteria that were being applied in all those previous rulings.

First, it has not changed very much. Second, it is possible to choose to apply the old rules. Regarding whether they are applied in the new tribunal, it is being applied in relation to a new agreement, but the old rules are being applied. Third, this is not just about that aspect. If the Government were serious about this issue, it would be saying it would only allow for enforcement of judgments made under the ICS system, but that is not what is in the Bill. The Bill allows for enforcement under any investor state arbitration rules, subject to the constraints on the Government that we will come to later, that come under any agreement that may be signed in the future. It is misleading to suggest we need not worry because none of this will happen when the legislation leaves that wide open.

I know we need to move on and we have amendments to deal with.

Thomas Byrne (Meath East, Fianna Fail)
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I am happy to respond.

Alice-Mary Higgins (Independent)
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Let us have one or two more interactions and then let us move on. I am keen to do so, and I know others want to contribute.

Thomas Byrne (Meath East, Fianna Fail)
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I welcome that Senator Higgins has moved on from her initial statement, which certainly gave the impression to everybody that there was a workaround of the new system.

Alice-Mary Higgins (Independent)
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There is.

Thomas Byrne (Meath East, Fianna Fail)
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There is not a workaround of the new system. The Senator has acknowledged that it is a new system and that there are protections and changes made.

We have been clear that this Bill is putting in place a framework based on the new model, which is the basis of all the modern EU trade agreements that have investment protection dispute resolution commitments in them. It is the Government's clear position that this Bill and its order-making power will only apply to the approach in CETA and other similar agreements. We have been very clear that the attributes of the arbitration system present in CETA are what this Bill will apply. We have had changes, which apply in every single case and cannot be opted out of by the parties, in relation to the consistency and predictability of investor court decisions, the independence and impartiality of members of the tribunals, transparency and, substantively, as I have explained, the State's right to regulate. All those protections have been built into the investor courts system and they cannot be opted out of unless the State agrees to do so, and, presumably, the State would not agree to do so.

Alice-Mary Higgins (Independent)
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It is not the case that this legislation provides that provision. It is incorrect of the Minister of State to suggest that the Government has been clear in our legislation that it is possible to sign up to any international agreement where that agreement provides for the making of awards pursuant to investment dispute resolution provisions. It does not state which investment dispute resolution provisions. The Minister of State is asking that we trust the Government because he is sure the investment dispute resolutions will be wonderful. He is saying that about this Government and every future Government until infinity, because there is a 20-year exit clause. He is saying there will always be better investment dispute resolution mechanisms. There is a workaround, which is the fact that it can be done under this Bill. The right to regulate, which we have said we will come back to, is a red herring because the question is not about the right to regulate. That has not been compromised by previous trade agreements. What has been compromised is the effective ability to regulate without an unknown and incredibly dissuasive and dangerous cost being attached to that regulation.

Again, there is fair and equitable language in the old agreements too. What is also in CETA is an allowance that the old rules can be applied. That set of rules has given us many judgments that are very problematic. The language the Minister of State referred to concerning the right to regulate and being fair and equitable does absolutely nothing to address that-----

Thomas Byrne (Meath East, Fianna Fail)
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It does.

Alice-Mary Higgins (Independent)
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-----because fair and equitable was the language used in previous agreements.

Thomas Byrne (Meath East, Fianna Fail)
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It was not.

Alice-Mary Higgins (Independent)
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The right to regulate is meaningless. It is like giving somebody the right to breathe. It literally has nothing to do with it. The right to regulate was not impinged on by other agreements. What other agreements did was to have a cost attached. This concerns a tribunal making awards for compensation. It is not about whether a thing can be done, but about how much it costs. We know that how much it costs can, effectively, lead to a chilling effect, where things do not happen and legislation is not made and where it becomes impractical in some cases and impossible in others for governments to legislate and deliver the public policies that they may wish to deliver. We have a litany of examples of that.

That was true in the past and it is true under the terms of the ICS. To be very clear, all that is referred to here is an agreement providing for the making of awards pursuant to investment dispute resolution provisions. There is no exclusion in this Bill as to which investment dispute resolution provisions may be applied in relation to other agreements. We will come back to this later, but it is a pig in a poke. We do not know. The Minister of State may state his intention in respect of which kinds of trade agreements he intends to sign up to personally, but he may be gone in a few years' time. Perhaps he will be here for decades. Who knows? The point is that any future Minister will be able to add any other kind of future agreement with any other kind of future investment dispute resolution mechanisms attached. The Minister of State will say that it will have to be approved by the Dáil-----

Thomas Byrne (Meath East, Fianna Fail)
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That is an important point. It is not done personally by me.

Alice-Mary Higgins (Independent)
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It is an important point, but it will be done without scrutiny and even the requests that we wrongly agreed to. I did not agree to them personally. We voted against. I am referring to pre-legislative scrutiny, expert input and any of the areas of examination that are, and should be, properly applied to future agreements.

It is clear that the Minister of State and I disagree on this matter, and we will circle back to it, but, on this aspect, it is incorrect to suggest that it will only be the ICS that is attached. That is not the case. That is not what is on the paper in front of us that we are being asked to agree to.

Thomas Byrne (Meath East, Fianna Fail)
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I have rejected that point on a number of occasions. I have to reject the idea that I personally will be deciding on these things. If a government is to decide to sign up to an international agreement of this nature, it will have to make a decision. The Dáil, under a very specific constitutional provision, also has to make the decision. That is an opportunity for the Dáil to decide yea or nay. The impression given by this debate on the legislation is that, somehow, it gives a carte blanche to the Government. It does not. It simply-----

Alice-Mary Higgins (Independent)
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It is a fast-track process.

Thomas Byrne (Meath East, Fianna Fail)
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There is no fast-track process.

Maria Byrne (Fine Gael)
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The Minister of State without interruption, please.

Thomas Byrne (Meath East, Fianna Fail)
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What is happening here is that the Government, and the previous Government, very clearly wanted to have the Dáil ratify the Comprehensive Economic and Trade Agreement and other trade agreements. A challenge was brought through the courts. The court said it was not possible under the current provisions, but it also said that if the Government wishes to do it, then, under its prerogative and the Dáil's prerogative, this is a way it could be done that would be constitutional. That is all we are doing here. There needs to be a separate debate in the Dáil then on the formal ratification of CETA and any other trade agreements it would apply to.

I cannot bring the matter any further in relation to the investor court system, except to state what I have stated on numerous occasions, namely, that this is a radically new procedure, with many checkpoints and improvements included to ensure that it is transparent and fair and - this is not a small point - that the State has the right to regulate. That could not be clearer from the text of the agreement and from the text of the joint interpretive statement. We heard a lot in previous debates about the European Court of Justice. The court has stated that the parties:

have taken care to ensure that those tribunals have no jurisdiction to call into question the choices democratically made within a Party relating to, inter alia, the level of protection of public order or public safety, the protection of public morals, the protection of health and life of humans and animals, the preservation of food safety, protection of plants and the environment, welfare at work, product safety, consumer protection or, equally, fundamental rights.

The Court of Justice of the European Union could not be clearer about this and what CETA is designed to achieve. The Opposition want to keep contradicting the text of CETA and the text of the joint interpretative instrument. The Supreme Court has made comments on this as well. I know what Senator McDowell said about obiter dictumbut this was stated by a number of justices and in a full decision of the Court of Justice of the European Union.

This matter could not be clearer. This is an attempt by the Opposition some of whom, and I accept everyone's good faith on this, do not support trade agreements as a general principle. This Government supports trade agreements as a general principle and all trade agreements mean give and take on both sides. We know in Ireland's case, the take is much more significant in every trade agreement we have ever been a party to or entered into.

Maria Byrne (Fine Gael)
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Amendments Nos. 1 to 7, inclusive, are ruled out of order as they are in conflict with the principle of the Bill as read a Second Time.

Chris Andrews (Sinn Fein)
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I move amendment No. 9:

In page 4, line 10, after “Court” to insert “, and only after the High Court has determined the application in accordance with subsections (3) to (3C),”.

I will speak very briefly to amendment No. 9. This is a consequential amendment, relevant to amendment No. 11, which seeks to insert subsections 3 to 3C. I will speak to that amendment when we come to it. I will withdraw the amendment with the intention to table it on Report Stage.

Maria Byrne (Fine Gael)
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Amendment Nos. 10 to 13, inclusive, are related and may be discussed together by agreement. Is that agreed? Agreed.

Chris Andrews (Sinn Fein)
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I move amendment No. 11:

In page 4, to delete lines 14 to 19 and substitute the following: “(3) The High Court shall refuse leave under subsection (2)(i) where, having considered the matters in subsections (3A) and (3B), it considers that enforcement of the award would—

(a) materially compromise the constitutional identity of the State,

(b) materially compromise fundamental principles of the constitutional order of the State, or

(c) materially compromise the State’s obligation (reflected in Article 29.4.4 of the Constitution) to give effect to European Union law (including the Charter of Fundamental Rights and Freedoms) and to preserve its coherence and integrity.

(3A) Without prejudice to the generality of subsection (3), enforcement shall be refused where the High Court is satisfied that the award (or the reasons for the award) involves any of the following:

(a) is founded on a determination that an action or decision of the people, at a Referendum in accordance with the provisions of Article 46 or Article 47 of the Constitution, constituted or contributed to a breach of the international treaty in question,

(b) is based upon, or gives effect to, a refusal by the relevant tribunal to follow a material decision of the Court of Justice of the European Union,

(c) is inconsistent with, or would require the State (or any organ of the State) to act inconsistently with, a final and conclusive decision of an Irish court,

(d) is founded on a determination that an Irish court has denied justice or committed a fundamental breach of due process in judicial proceedings, in circumstances where enforcement would amount in substance to a collateral attack on the finality and conclusiveness of such decision,

(e) would impose on the State liability in damages in respect of the enactment or maintenance of a legislative measure (or a measure having the force of law) enacted in good faith within the State’s constitutional order, or

(f) would otherwise be at odds in a material way with the legislative and juridical autonomy of the State.

(3B) For the avoidance of doubt, the categories in subsections (3) and (3A) are not closed.

(3C) An application for leave under subsection (2)(i) shall be determined on notice to the parties and after hearing such parties as the Court considers appropriate.

(3D) The burden of establishing that leave should be granted and that none of the grounds requiring refusal under subsection (3) to (3B) arises shall rest on the party seeking enforcement.”.

Amendment No. 11 seeks to add clarity to the situation where the High Court can set aside an award made by investor courts falling within the scope of this Bill. Currently, the wording is that awards are not and never were enforceable if they compromise the constitutional order of the State or the autonomy of the legal order of the EU. There was discussion in the other House about the lack of concrete definition of what that would mean and our amendment seeks to add some form of clarity to that. The proposed subsection 3B is clear that the definitions we have provided are non-exhaustive. The Minister of State previously defended the vague and unexplained definitions that are currently in the Bill. I want him to clarify what he understands these terms to mean.

This Bill will have profound consequences on the right to regulate and for the prerogatives of the House to exercise our constitutional functions. For example, if a government made a decision to oppose a Private Members' Bill or an amendment based on the threat of potentially being sued under these international agreements, is the Minister of State be of the opinion that this would compromise the constitutional order of the State, particularly Article 15 of the Constitution? If any government decided not to provide a money message for a Bill due to fear of litigation, would that compromise the constitutional order of the State?

On the autonomy of the legal order of the European Union, does this mean the treaties, the Charter of Fundamental Rights of the European Union, the CJEU, case law and directives or regulations? This is a really important clarification we need because the House is being asked to pass legislation on foot of a Supreme Court ruling without pre-legislative scrutiny or a commitment that the Government will not guillotine the debate, which is happening.

We also need to examine the issue of automatic enforcement, which was aired quite extensively in the Costello case. In 2022, the Supreme Court found that the ratification of CETA would detract from the jurisdiction of the Irish courts, contrary to the Constitution, because a judgment at the CETA tribunal would be made virtually automatically enforceable in the High Court and the High Court would have no power to refuse enforcement, even where the award fundamentally compromised the Irish Constitution or EU law. This would undermine the conclusiveness and sovereignty of our courts system and I am not convinced that this Bill, as it stands, has clarified that.

Patricia Stephenson (Social Democrats)
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I welcome this amendment to add really detailed clarity on the way those decisions will be made. We outlined a few of the concerns we have last week to the Minister of State, but it feels like the Bill is attempting to get around the protections afforded by the Constitution through this amendment Bill so that our national courts have a role in enforcing successful investor claims against Ireland in Ireland for specified agreements. However, this feels highly unlikely in the event that an investor who has chosen to take their dispute outside of the jurisdiction of our own national courts to the special extrajudicial tribunals provided for deals in CETA and who has then won an award. Will they then somehow have a radical conversion and suddenly opt to go into an Irish court to enforce that award when they could go to any court in any country within the system or within the jurisdiction and have it enforced with no regard to what is set out in this Bill or under EU law? That is a very significant concern.

Alice-Mary Higgins (Independent)
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What we are seeing in amendment No. 11 is an attempt to expand the very vague language there is in the Bill at the moment. Basically, it says it was never enforceable and we would not enforce it if enforcing it would compromise the constitutional order of the State or the autonomy of the legal order of the European Union. It is very unclear what is meant by the constitutional order of the State or what is meant by the autonomy of the legal order of the European Union.Is that a bar that is very far back, where we are almost back to the right to regulate? If it compromises the existing Constitution and the fact that the European Union has its autonomy, are we going to get into the kind of granular examples, which are provided under amendment No. 11, that make it a little bit clearer when we talk about the idea and we make the choice – this is stepping into the noose analogy from Senator McDowell - to place ourselves at the mercy of a tribunal and then say that we will not enforce it if it conflicts with this very vague language about constitutional order and the European Union? What we have in amendment no. 11 from Senator Andrews and others is something that is actually more meaningful, whereby when we say that we will not conflict with the autonomy, does that mean that we will not conflict with the ability to deliver on the Charter of Fundamental Rights, not through a direct block but by compromising the ability and obligation of the State to give effect to European laws?

Are we talking about a situation whereby, in terms of the Constitution, if we have a referendum and that referendum of our Constitution gives rise to consequent measures and then we have a case taken seeking compensation in relation to measures which have arisen as a result of that referendum, will they be eligible or not if we have situations again? If we as a collective choose to give each other particular rights and those rights end up compromising in a way that is claimed to be unfair or inequitable to the interests of a particular industry or company, will that be featured? How will that factor into the enforcement piece? What if the compensatory award from the arbitration tribunal is based on a refusal by a relevant tribunal to follow a decision of the Court of Justice of the European Union, and if the measure the Government has taken, for which compensation has been sought, is one that if we did not take that measure, we would be in conflict with rulings Court of Justice of the European Union? Indeed, what if it is a situation whereby this compensatory measure for which enforcement is being sought would impose on the State liability or damages in relation to the enactment or maintenance of a legislative measure that the State enacted in good faith within its constitutional order - and some later ones are going to come in which set it out a little bit more?

Why this all matters is the arbitration bodies are not bound. The Minister quoted a lot about the European Court of Justice, and that was a consideration of whether it is directly in itself de facto a conflict to have these courts exist. That was that ruling but it was not a matter of endorsing the findings of it. There were a lot of conditionalities of hopes from the Court of Justice of the European Union as to how things might work out but let us be clear, in terms of the arbitration bodies themselves, they are not bound by the European Court of Justice. They are not bound by national law or constitutional referendums. If an arbitration body of any kind of these kinds of investor-State mechanisms is being asked whether a company is being treated fairly or inequitably, it considers the law solely in itself. It considers the law solely in relation to how that company has been affected in relation to its reasonable expectations of profit and whether its future profit has been taken from it in a way that is unfair or unreasonable. It is not considering in the round how that really relates to constitutional issues in Ireland or what were the obligations that the Irish Government had under the Court of Justice of the European Union. It may choose to consider that but it is not bound by it.

We are not talking about a new court that is somehow sitting inside the legal system we know; we are talking about new courts or tribunals that are sitting outside our legal systems. It simply goes to our legal systems to have them enforced and have the moneys taken. In terms of making the awards, however, it does not consider that. There are multiple examples here. In Huawei vsSweden, it took a case - an ISDS claim - against Sweden over Sweden's decision to ban Huawei's involvement in 5G in line with an EU policy on the transposition of the EU toolbox on cybersecurity international law. A number of countries took measures in relation to that. In that tribunal, Sweden asked that the EU would be allowed to give evidence in the case. This is even to be allowed to give evidence in the case - and the tribunal limited input from the EU and dismissed any need for the EU to place Sweden's actions in the context of EU law. In the case of Klesch vsthe EU, Germany and Denmark, this is a fossil fuel investor suing the EU, Germany and Denmark. It is suing everybody for compensation in relation to the 2022 windfall profits tax on the energy sector and is challenging the implementation of EU Council directives and again, in the case of Denmark, this is where the effects kick in. The German Government decided not to collect the tax on the investor and the tribunal ordered that the German Government should not collect the tax pending the outcome of the case.

There are multiple examples whereby the arbitration bodies are not asking how this fits in. They are not saying they understand Ireland made this decision because of a referendum of the people that mandated measures in relation to care or whatever else it might have been. They are not saying they understand that we did not opt into whatever decisions are made or that this is why it has to be done or that there are new EU rules which set the context and even though that affects a company that was encouraged to invest in Ireland, Ireland has to ensure it is abiding by the European Court of Justice and its rulings. That is not binding on an arbitration body when it is deciding how much compensation to award. It may be a factor that is considered or not but it is not binding in any way. Having agreed without an obligation to this, having chosen to say we want to move into this next phase where we have these tribunals which can make awards against us - again a step that solely the Government is choosing to push at this time rather than continue in a longer period of provisional application - by doing that and pressing that point and placing us in that situation, all that we can come back at according to the Government is that we will agree to bodies making these rulings against us voluntarily but we will not enforce them if they compromise the constitutional order or the autonomy of the European Union. What does that mean? Does that mean at the absolute minimum the constitutional order is when it would affect the fact we are a constitutional nation and that the European Union can make laws?

Regarding the points which Senator McDowell very ably made, if we agree voluntarily to make ourselves subject to these rulings, then the choice in terms of surrendering sovereignty has already been made. We have chosen to say we want to be subject to these arbitration rulings. That is then going to be stacked by a court. Leaving aside the fact that this supposed fix to the concerns the public had is very vague, and amendment No. 11 would clarify it, it would be great if the Minister went through and stated which of these aspects of amendment No. 11 are going to apply or not or if he accepts amendment No. 11 as an expansion of clarification. There is also the point concerning amendment No. 12. Is that amendment grouped with this? It is.The actual thing the public cares about when they hear this and the fear that they have is in no way addressed by the language of the Bill. I have said that the arbitration bodies do not have to balance out EU law, constitutional law and everything else. It is almost a simple law of tort. They are literally in that one space and very often come from that frame in their adjudications. A High Court would normally be provide a balance that considers the public interest. It would be in the mix. The public interest is not in the mix for the arbitration bodies. It is not in the mix for the arbitration bodies that are making the decision. They are not bound by the public interest, the European Court of Justice or national laws at any level. The High Court, when it is deciding whether to enforce, according to the legislation, is only bound by very a narrow framework, which is whether it compromises the constitutional order, the fact that we are staying within the Constitution or the legal autonomy of the European Union. It is not being asked to do what it normally does, which is to consider the public interest. That is why amendment No. 12 is important. It would put the public interest among the factors the High Court should consider when deciding whether it should be enforcing a ruling from these courts, which operate in their separate space. It would have to weigh the public interest and all the facets that go with that alongside a consideration of the constitutional order and questions of EU law.

Amendments Nos. 11 and 12 are constructive. Amendment No. 11 tries to give meaning to these very loose phrases in the Bill, "constitutional order" and "legal autonomy", while amendment No. 12 tries to get to what the public care about and the kinds of concerns that led the Supreme Court to worry about the constitutionality in the first place and to find of favour of then Deputy Costello and the compromising of the public interest. I ask the Minister of State to be clear in supporting these two amendments.

Maria Byrne (Fine Gael)
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Before I call Senator O'Reilly, I welcome to the Gallery members of Lusk Community Council, who are guests of Deputy O'Donoghue.

I also welcome the group form Carrowholly National School, who are guests of Deputy Paul Lawless. As is customary here in the Senate, they will have no homework for the rest of the day. I hope they enjoy their visit.

Sarah O'Reilly (Aontú)
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Before I address amendment No. 12, I want to respond briefly to comments made by the Minister of State during the previous debate. He accused me, and only me among all of those who spoke, of presenting information that was factually incorrect regarding CETA. I was not given an opportunity to reply at the time. He quoted from Article 8.9(2) but conveniently omitted the exception in the agreement to which I was explicitly referring. The agreement states:

When applying the above fair and equitable treatment obligation, the Tribunal may take into account whether a Party made a specific representation to an investor to induce a covered investment, that created a legitimate expectation, and upon which the investor relied in deciding to make or maintain the covered investment, but that the Party [which can be the Government] subsequently frustrated.

That is not my interpretation. It is the text of the agreement itself.

My concern is straightforward. What exactly constitutes a "legitimate expectation"? What constitutes that expectation being frustrated? If one government encourages investment under one policy framework and a future government changes legislation in the public interest, could that become grounds for a compensation claim? These are exactly the kinds of arguments that have been made under ISDS mechanisms globally. That is why this matters so much.

Turning to the amendment itself, I stress that this proposal is not substantially different from the Government's own drafting. In fact, it largely reflects the assurances repeatedly given verbally by the Minister of State during the debate. The amendment simply adds an explicit safeguard, stating that no award should be enforceable where it would materially impair the capacity of the State to legislate or regulate the public interest. If he is sincere in his assurances that Ireland's right to regulate will remain fully protected, there should be absolutely no reason to oppose the amendment. It merely copper-fastens in legislation what the Government claims is guaranteed. This amendment is about protecting democracy and sovereignty, protecting future governments and ensuring that no arbitration mechanism can undermine the ability of this State to legislate in the interests of its own people.

Thomas Byrne (Meath East, Fianna Fail)
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I was pretty robust with everybody who spoke in the previous debate. I robustly defended my own position and tried to get the correct information out. I will be robust with Sinn Féin now because, quite frankly, it is hard to take seriously its amendment to insert subsection (3C), which states, "materially compromise the State’s obligation ... to give effect to European Union law (including the Charter of Fundamental Rights and Freedoms) and to preserve its coherence and integrity". Every time there has been a referendum in this State relating to European law for the betterment of the country and for greater cohesion, Sinn Féin has voted "No". It has done so in every referendum to put that into effect. The Senator is now telling me that Sinn Féin is coming to the Seanad worried sick about this issue because somehow it is in jeopardy. It has been a fundamental position of Sinn Féin that it opposes the very thing it is looking for here today. On that basis, it is very hard to take the party seriously or to take seriously some of the arguments coming forward.

I have said repeatedly to Sinn Féin, Senators Higgins and O'Reilly and Aontú that the right to regulate is clearly defined. This Bill is not about the ratification of CETA. Everybody is quoting from bits of judgments and bits of laws. The Government cannot do that. It has to look at every line of every judgment and agreement. We cannot pick and choose. Senators are quoting the fact that the ratification of CETA was found to be an unconstitutional matter. That is accepted by everybody. The Government, more than anybody, has to take cognisance of that because it wants to ratify it. Nobody goes on to talk about what Mr. Justice Hogan suggested in his judgment. He was not giving an instruction to the Oireachtas or the Government. He made suggestions. The only person who referred to it previously was Senator McDowell. He was dismissive of Mr. Justice Hogan in that respect.

The amendment would replace the language that has been developed having regard to the Costello case and is intended to address the concerns of the Supreme Court. Neither amendment can be accepted.

The Government, with the assistance of the Attorney General, has carefully considered what the Supreme Court said. It is confident that the Bill addresses the concerns of the court in this case. We do not believe that adding the language set out in the amendment would achieve greater clarity. As a matter of legal policy, it is preferable to leave it to the courts to determine in any given case that the constitutional order of the State would be compromised by enforcing a particular award. The Senators' amendment is prescriptive on a matter that is properly one for determination by the courts.

In the amendment from Senators O'Reilly and Keogan, under what would be a new subsection (3C), they are asking us to put in a provision that would "materially impair the capacity of the State to legislate or regulate in the public interest" in the enforcement. However, they are completely ignoring that the right to regulate is in CETA itself, the interpretative instrument and the opinion of the CJEU. The right to regulate is protected. It is a matter with which the investor courts must comply. We keep saying that the right to regulate is not affected. There have been considerable efforts to ensure that is the case. It is not a matter of the enforcement in Irish law. It is a matter of the agreement, which is subject to a separate legal process to ratify. This legislation does not ratify it.A number of cases were put forward in the Seanad as if they were, perhaps, precedents for us to accept. They are not precedents because each and every one of the cases quoted in the Seanad was under the old system, which has been reformed and which we cannot go back to. This is about as much as I can say on the amendments. It has been set out very clearly that this is about the enforcement of potential awards. The right to regulate is separately provided for in the CETA agreement. We are not concerned about this in the slightest. Senator Higgins put forward the idea that the public interest is not in the mix but it is in the mix because the whole basis of the right to regulate under the agreement is about the public interest in the State and the State regulating, passing laws and having policies as essentially its electorate deems fit in the general elections, which ultimately appoint governments and parliaments.

Maria Byrne (Fine Gael)
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I welcome Senator Wilson, the father of the House, who has with him some Ukrainians, including Vladyslav Heraskevych, a Ukrainian Olympian. His sport is the skeleton, which is a winter sport. I congratulate him on his achievements. They are very welcome and I hope they enjoy their visit to Leinster House today.

Alice-Mary Higgins (Independent)
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Repeating again and again "the right to regulate" does not answer the question. The language in the amendment-----

Thomas Byrne (Meath East, Fianna Fail)
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That is what it is about.

Alice-Mary Higgins (Independent)
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With respect, "materially compromise" is the phrase. There are multiple instances and I gave one. The Minister of State said we are picking and choosing but we could mention lengthy cases that are pertinent because they have the same frames and the same language, and some of the same rules may be applied but we do not have time to quote them all at full length because the Bill is being guillotined. The fact of us giving truncated quotations is entirely a fact of the Government's choice in truncating the debate. The language in amendment No. 12 is "materially compromise". The question is not whether we can bring in a law in. We have said again and again it is a question of whether bringing in laws will be compromised. That concern has been expressed throughout. We look to the examples we gave, and I have given the example of Denmark choosing not to collect a tax because it would be subject to challenge. Germany was told not to collect a tax by the arbitration body that supposedly has no powers over it, pending the outcome of a case. Vermillion, a Canadian company operating in Ireland, took a case against France in relation to its new climate law. That climate law was diluted because of the huge costs attached to it. The then Minister of the environment was very clear on how his ability to deliver a proper climate policy was compromised by the threat and the fact of cases that would be taken with potentially large compensatory measures.

We have quoted before the fact that legal firms that advertise to take these cases are clear that laws can be affected. Even the fact of taking a case may get someone the outcome they want in terms of legislation, whether or not a compensatory award is given. With regard to the question of compromise on public interest, there is no obligation. The arbitration body does not need to weigh up and say it thinks it is for the best. The Minister of State might confirm it does not have to be bound by a national constitutional decision in Ireland or by a decision in the CJEU. They are not binding on an arbitration body in terms of when it makes its adjudication. They may be considered but they are not binding on it.

The Minister of State has not addressed, besides talking about Sinn Féin and referendums and trying to drag it back to trade, exactly what is meant by constitutional order or what exactly meant by EU legal autonomy. If there is a ruling by an arbitration body that is related to a measure taken by Ireland to comply with the European Charter of Fundamental Rights, a CJEU ruling or a constitutional referendum of our own people - and I am not asking whether it can take such a measure - can the arbitration body state it believes Ireland should pay X compensation to the company that unfairly had its reasonable expectations compromised and was unfairly impacted by that measure? This is how the process works. It can make such an award anyway regardless. We know the arbitration body will not be bound by a referendum of the Irish people, the European Charter of Fundamental Rights or a ruling of the CJEU. If the body makes a ruling will the Irish State enforce it? What are the specific proposals on what constitutes European law and constitutional orders? If the measure for which compensation is being awarded was one required by a referendum of the people, an CJEU judgment or the European Charter of Fundamental Rights under the law will this be enforceable?

Thomas Byrne (Meath East, Fianna Fail)
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There are a number of points to be made. Again, I cannot go any further on the right to regulate. I have quoted it to almost everybody and there have been statements made by Supreme Court judges on it. Again, there are cases being quoted by Senators that do not relate to the type of system under CETA. There was a German case to which Senator Higgins referred on the issue of tax collection. The CETA tribunal will not be allowed to make such an order. It does not even arise. It does not even relate to the legislation. The remedies are limited in any event and it is important to say this.

Comments have been made about the provisions on fair and equitable treatment included in CETA. It is important to stress in this regard that the standard drafted under the new system is very different from the old approach. While the fair and equitable treatment provision under the old approach is generally opaque and based on customary international law with no description of the content, these newer agreements clearly list the aspects of fair and equitable treatment. These include the denial of justice, manifest arbitrariness or targeted discrimination on manifestly wrong grounds, such as gender, race or religious belief. ICS agreements provide clear guidance to dispute resolution tribunals on how these standards should be applied. The detail and clarity is one of the improvements of the new investor court system, from which nobody has quoted any case because they cannot do so, addressing concerns raised in relation to the long-standing ISDS system.

Reference has also been made at times to the joint committees in these agreements. CETA and similar agreements include administrative and institutional provisions that provide for the establishment of committees, such as the CETA joint committee, which are responsible for questions concerning trade and investment between the parties and the implementation and application of the agreements. A party may refer to the joint committee any issue relating to the implementation and interpretation of the agreement or any other issue concerning trade and investment between the parties. Where serious concerns arise with regard to matters of interpretation that may affect investment, a select committee may recommend to the CETA joint committee the adoption of interpretations of the agreement. An interpretation adopted by the joint committee is binding on the CETA tribunal.

The wording in the legislation these amendments seek to challenge is derived from the suggestion of Mr. Justice Hogan to the Oireachtas and the Government that if we wish to ratify the CETA agreement then without being prescriptive or putting any obligation on the Oireachtas the Government, this is a way that it could be done in accordance with the Constitution. We have taken the advice of the Attorney General.Our lawyers have studied the judgment carefully in the round and drafted this legislation. I have described all it seeks to do and I cannot put the position any further.

Alice-Mary Higgins (Independent)
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The Minister did not answer the questions. Could he clarify, with a "Yes" or "No", the position on the three instances? I refer to where an award is based on compensation for a measure to ensure the State's compliance with the Charter of Fundamental Rights of the European Union, a measure to ensure the State's compliance with an ECJ ruling, and a measure taken by the State to ensure compliance regarding a public referendum. The Minister of State is defending the investor court system, but what we also have in front of us is what the High Court is going to be empowered to do, or not. Many of our amendments are trying to strengthen the hand of the High Court because it is not very clear that it will have any strong measures or tools in terms of denying enforcement. Senator McDowell has very adequately pointed to how such a denial of enforcement would be unlikely to stand up, but that is a separate debate.

My question is on the three specific instances. Is it the Minister of State's understanding, under this legislation, that the High Court would be able to deny the enforcement of an award in the three instances?

Thomas Byrne (Meath East, Fianna Fail)
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I cannot put the matter any further. The amendments are trying to tie the hands of the High Court. We are trying to give the High Court discretion. The items the Senator mentioned are not within the constitutional order of the State or the legal order of the EU. I do not believe it would be helpful to start expanding on what Mr. Justice Hogan said in his decision in the Costello case. We have examined that decision and drafted the legislation in accordance with it in order that it would be appropriate for the High Court, as we see it, to make these determinations. By going narrower than the broad scope we have given, the Senator is tying the hands of the High Court. That is not something we feel is appropriate.

Alice-Mary Higgins (Independent)
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To clarify, I do not believe the amendment is going narrower; rather, it is trying to add detail. We still have not had an answer as to whether the three instances are included. On the basis of what the Minister of State has said, we are left to interpretation.

I wish to ask the Minister of State about the obligations to comply with European law, which we have under our Constitution. If the investment court tribunal and agreement thereon become part of European law, how does the Minister of State envisage this would be balanced against other rulings of the ECJ? Would the High Court be seeking to balance that? How would it bind in terms of a constitutional amendment? How would it bind in terms of the Charter of Fundamental Rights of the European Union? What status does the Minister of State think that aspect, which Senator McDowell has very clearly enumerated and which I agree is likely to be taken up by the ECJ, would have? How would it be balanced out?

Thomas Byrne (Meath East, Fianna Fail)
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I am not sure if I heard the question correctly but I believe the Senator asked me how the High Court makes findings. That is not a question for the Oireachtas to decide.

Alice-Mary Higgins (Independent)
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Is it the Minister of State's understanding that those three instances can-----

Thomas Byrne (Meath East, Fianna Fail)
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We cannot start to be prescriptive about what the High Court will or will not find. We are giving it guidance, through legislation, based on what the Supreme Court has said.

The term "constitutional order" has been referenced by Irish courts in a number of cases. It would be a matter for determination in the ordinary manner by the High Court, and of course the Supreme Court if necessary, in any cases regarding the enforcement of awards in the State under the new Article 25A of the 2010 Act. It is not for the Executive or Legislature to be prescriptive about what constitutes the constitutional order of the State, nor is it for me to be prescriptive here as to what a High Court judge might find in the future.

Alice-Mary Higgins (Independent)
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Nonetheless, in his legislation the Minister of State is giving the prescription in terms of the frame he is choosing to apply in relation to it. What is the objection to the inclusion of the phrase on the material compromise of the public interest? Again, it is a matter of the language on not having a material compromise of the public interest as a determination of the arbitration body, to which it is not bound. This is about the High Court. Why not include the question of what would materially compromise the public interest? The Minister of State was nodding earlier when we were saying the public interest is normally weighed by the High Court in its adjudication. In this regard, what is the objection to including the language that would guarantee that the High Court, not the tribunal itself, would be empowered to consider the public interest in making a decision in relation to enforcement?

Thomas Byrne (Meath East, Fianna Fail)
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Essentially, the Senator is trying to make the case that a CETA tribunal is going to make a decision that fundamentally affects how public policy is made in this country and I am telling her that is not possible. What we are doing is simply amending the Arbitration Act to allow us to ratify CETA. Ultimately, and quite honestly, we do not share the Senator's view. We have considered this very carefully from a legal position. We do not share her view or her concerns about how the Irish courts would interpret the new provisions set out in this legislation. I have explained at length where the thinking came from. It is very simple because it is in black and white. There is no secret process to how we came up with this law. The thinking is black and white in the Supreme Court decision of Mr. Justice Hogan. To account for that, and based on the legal advice we have from the Attorney General, we very carefully drafted the legislation in order that we can ratify CETA in a constitutional manner, which is a policy objective of the Government.

Alice-Mary Higgins (Independent)
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Was amendment No. 13 in the grouping?

Mark Daly (Fianna Fail)
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Amendments Nos. 11 to 13, inclusive, are related, but the discussion was under amendment No. 10. We are on amendment No. 11.

Chris Andrews (Sinn Fein)
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What about amendment No. 13?

Mark Daly (Fianna Fail)
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No, that was discussed with amendment No. 10. We are on amendment No. 11 now.

Chris Andrews (Sinn Fein)
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Amendments Nos. 11 and 13.

Alice-Mary Higgins (Independent)
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It is amendments Nos. 10 to 13.

Mark Daly (Fianna Fail)
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The grouping was under amendment No. 10. Before I put the question on amendment No. 11-----

Chris Andrews (Sinn Fein)
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May I not comment on amendment No. 13?

Mark Daly (Fianna Fail)
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When we were dealing with amendment No. 10, the House agreed that amendments Nos. 10 to 13, inclusive, could be discussed together, by agreement. They were discussed together, by agreement, under amendment No. 10.

Alice-Mary Higgins (Independent)
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They are still being discussed.

Chris Andrews (Sinn Fein)
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I am just speaking after Senator Higgins.

Mark Daly (Fianna Fail)
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We are now on amendment No. 11. Does the Senator want to discuss amendment No. 13?

Alice-Mary Higgins (Independent)
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They are grouped.

Sarah O'Reilly (Aontú)
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They are all grouped.

Chris Andrews (Sinn Fein)
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They are all grouped, though.

Mark Daly (Fianna Fail)
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Senator Andrews may comment on amendment No. 13.

Chris Andrews (Sinn Fein)
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Amendment No. 13 seeks to expand the compatibility list concerning awards that have never been enforceable in the State to include the Paris Agreement, the sustainable development goals, the Convention on Biological Diversity, the Aarhus Convention, the International Covenant on Economic, Social and Cultural Rights, and conventions of the International Labour Organization. Awards made by investor courts could undermine action to fulfil our obligations under these conventions, all of which the State is a party to and obliged to uphold.

We need to be really clear that the most prolific users of investor courts are the fossil fuel multinationals destroying our planet. More than €100 billion in public money has been awarded to private investors in investor-state dispute settlement courts. According to the most comprehensive analysis yet by the ISDS tracker, the UN Intergovernmental Panel on Climate Change, IPCC, has specifically called out investor courts as an impediment to climate action. I note a recent report by Climate Action Network Europe demonstrating that investor courts are incompatible with a just transition.

When we speak about climate action, we all agree on the need to bring people with us and ensure a just transition for workers and communities. These courts are obstacles to that goal. They allow fossil fuel companies to exert great influence over public policy and essentially give polluters a stick to beat governments with when they decide to regulate in the interest of their citizens.

Mark Daly (Fianna Fail)
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Before I call the Minister of State, I welcome the guests from Pittsburgh: Christina Cossotis, CEO of Pittsburgh International Airport, Vince Gastgeb, Tyler Laughlin, Bryan Dietz, Rich Fitzgerald, and John Robinson, Rob Vescio and Matt Smith. I thank Senator Devlin Robinson for bringing them in.The Senator is welcome back to the Seanad. He was here four weeks ago. At this stage, he has been here so long he might end up a Member of this House if he is not careful. I welcome everybody from Pittsburgh International Airport. This week saw the first flight from Pittsburgh as part of Aer Lingus's new strategy within the United States of America. I really appreciate our visitors taking time out of their busy schedules to be here in the Seanad today.

Thomas Byrne (Meath East, Fianna Fail)
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With regard to amendment No. 13, CETA includes commitments to co-operate on trade-related environmental issues of common concern, such as climate change. In fact, in this agreement between the European Union, its member states and Canada, everybody has agreed not to lower levels of environmental protection to encourage trade or investment. That has been agreed between the parties. In any event, there is absolutely no question of the State not meeting its obligations under the agreements referenced in the amendment due to an investor courts system. The amendment is completely unnecessary.

Chris Andrews (Sinn Fein)
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That is an agreement between the states and the EU. Am I correct that it is not related to CETA?

Thomas Byrne (Meath East, Fianna Fail)
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There are commitments in CETA with regard to trade-related environmental issues of common interest, such as climate change.

Mark Daly (Fianna Fail)
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I just want to make sure----

Alice-Mary Higgins (Independent)
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May I come in? It is a single sentence.

Mark Daly (Fianna Fail)
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When somebody is speaking, you have to let them finish.

Alice-Mary Higgins (Independent)
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These agreements about co-operation are agreements between the parties, that is, Canada and the European Union. However, corporations do not sign up to those agreements. Those who will be using the arbitration mechanisms or investor-state dispute mechanisms that will be enforced here have not necessarily signed up to that agenda. Canada and Europe agreeing with each other to do something does not prevent corporations choosing to pursue their own policies as regards their investments or interests.

Thomas Byrne (Meath East, Fianna Fail)
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It is just not credible to come into the Seanad and say that, while we know there is an agreement between Canada, the EU and its member states not to reduce the level of environmental protection, these big bad old corporations are going to be able to use little loopholes here and there to force all of those who came to this agreement to do what they do not want to do. It is suggested that sovereign states will be forced to do what they do not want to do and what they all agreed not to do as a fundamental part of this agreement. The Senators are saying that, despite the parties having done all of this, companies will be able to work their way around it. There is no logic to the argument that is being made.

Alice-Mary Higgins (Independent)
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It is not because of the agreement but because of the investor court component.

Thomas Byrne (Meath East, Fianna Fail)
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The agreement itself says that states are not going to reduce the level of environmental protection to facilitate trade and investment. I cannot continue to make that point. There has to be some realism to this debate. We keep hearing references to cases and I keep saying that this is a new system that is designed to address some of those concerns. Again, it comes back to the fundamental point that the certainty the trade agreement with Canada has offered, the reduction in tariffs and the openness to trade have generated economic benefits for this country and for our citizens. We cannot take those economic benefits for granted. Anyone here who is active in a constituency with a whiskey distillery or a manufacturer of Irish cream or another specific Irish product will know that these companies are benefiting very directly from the trade agreement with Canada. The same goes for agricultural products as well. Members cannot come into the Seanad to rail against trade agreements and then go back to the farmers in the constituency in which they live to tell them that they voted against trade agreements that have allowed them to sell their produce abroad. For example, 90% of beef products-----

Alice-Mary Higgins (Independent)
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This is not relevant at all.

Thomas Byrne (Meath East, Fianna Fail)
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A great deal is sold abroad. This is a general point about trade agreements. We must continue to support them. The interpretations that have been offered here in the Seanad are simply not the reality.

Mark Daly (Fianna Fail)
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Before I bring in Senator Andrews, I welcome guests of the Ceann Comhairle, Deputy Verona Murphy, from Our Lady's Island National School. They are most welcome to Seanad Éireann. We also have guests of the Minister, Deputy Peter Burke, joining us in the Seanad. They are also most welcome.

Chris Andrews (Sinn Fein)
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Private investors have received over $100 billion in investor-state dispute settlements through the courts. That figure comes from the dispute settlement tracker. How does the Minister of State explain that? Investors have made $100 billion. Is that going to continue? It is hard to understand how he can justify saying this will work.

Aidan Davitt (Fianna Fail)
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I have been in the Seanad for about ten years. To speak to something the Minister of State said, this has been on our radar for the past seven or eight years. The guys over there have been talking about it a lot more than I have. While we are here to fully implement the legislation, the agreement has been in use for seven or eight years. We have been talking about a lot of figures here. What has been the upside for the economy? Can the Minister of State give us figures in that regard? Can he just give us a couple of numbers on trade and employment and explain the benefit of all of this is? Whenever I hear anything about this, it all seems to be negative. I am trying to see the bigger picture as regards the position since the agreement has been in use, if not fully implemented.

Sarah O'Reilly (Aontú)
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On a point of order-----

Mark Daly (Fianna Fail)
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If Senators want to speak, I ask them to please indicate. I will then call them. Does Senator Higgins want to speak?

Alice-Mary Higgins (Independent)
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We have amendments. We are specifically speaking to amendments. Everybody who has spoken has been speaking to these amendments.

Aidan Davitt (Fianna Fail)
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Are you the Chair?

Alice-Mary Higgins (Independent)
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In the interests of time, can we keep moving through the amendments?

Thomas Byrne (Meath East, Fianna Fail)
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Again, I have to go back to the joint interpretative instrument on the environment, which states:

CETA commits the European Union and its Member States and Canada to provide for and encourage high levels of environmental protection, as well as to strive to continue to improve such laws and policies and their underlying levels of protection.

CETA explicitly recognises the right of Canada and of the European Union and its Member States, to set their own environmental priorities, to establish their own levels of environmental protection and to adopt or modify their relevant laws and policies accordingly, mindful of their international obligations, including those set by multilateral environmental agreements.

The instrument does not just reference one agreement, as the Senator has done. It includes the full range because, of course, things will change over time. I cannot go further than that on this particular point. It is self-evident if one reads the text of the joint interpretative agreement and the other texts connected to this agreement.

There were criticisms of the old system. I keep saying that the criticisms of the old system have been recognised ye, each time I come into the Seanad, I am given a long list of cases that were decided under the old system. Speaking about the old system, one of the negotiators of CETA said that the new system is a very different system that took concerns about the old system, such as those the Senators have raised, to heart. The negotiators heard about those decisions and concerns and did their best to alleviate them by coming up with a reformed investor court system. Of course, the Opposition gives that no credence because it does not suit the anti-trade agreement agenda that some people in the Opposition have, although I am not accusing everyone of that.

On Senator Davitt's point, it is important to talk about the benefits of this agreement. CETA has contributed to a significant increase in bilateral trade in goods and services with Canada since its provisional application in 2017. It has directly created jobs in each and every constituency. Every Senator will know people working in industries and businesses that benefit from CETA. Trade has increased from €3.2 billion in 2016 to more than €12 billion in 2024. The reason I say that Senators will know such people is that Canadian companies employ 22,000 people in Ireland. There are also huge numbers of Irish people working in Irish companies that export to Canada.That is the simple reality of this. It is why we are here. This is about protecting jobs. I have noticed - and this is a general point about politics in Ireland - that we never hear from the Opposition about how to generate more than €100 billion per year for public spending. We never hear a debate about how to do it better or how to generate more income. From my point of view, as Minister of State with responsibility for European affairs, and that of the Government, it is all about opening the country to further trade, developing Irish companies that can trade abroad and create jobs and investment here and continuing to attract foreign direct investment, FDI. That model, which is criticised by many, has been spectacularly successful in generating jobs and investment in the country. Everyone who comes in here to nitpick around this is completely ignoring the bigger picture. Everyone who comes in here and quotes old cases that are not relevant is doing a disservice to all the people in their constituencies who are employed by companies that completely depend on trade. The minute we forget about the importance of trade agreements, the minute we challenge-----

Nessa Cosgrove (Labour)
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On a point of order, no one is saying they do not agree with trade. This is totally-----

Mark Daly (Fianna Fail)
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Everyone will be allowed to come back in.

Thomas Byrne (Meath East, Fianna Fail)
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They cannot handle the truth. That is the reality. They cannot handle the truth.

Mark Daly (Fianna Fail)
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Please.

Thomas Byrne (Meath East, Fianna Fail)
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I have said it before and I will say it again-----

Nessa Cosgrove (Labour)
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No one is against trade.

Thomas Byrne (Meath East, Fianna Fail)
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The fundamental difference between the position of the broad thrust of the Opposition and that of the Government is that the Opposition has no regard for the European Union, for trade agreements-----

Alice-Mary Higgins (Independent)
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This is purely baiting and an attempt to derail a discussion.

Thomas Byrne (Meath East, Fianna Fail)
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I am not derailing it because we have another two hours of debate.

Nessa Cosgrove (Labour)
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You are derailing it.

Thomas Byrne (Meath East, Fianna Fail)
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I am not derailing anything.

Nessa Cosgrove (Labour)
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How can you say that about the Opposition? It is total lies to say that.

Thomas Byrne (Meath East, Fianna Fail)
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I have been here for hours already and I am happy to be here for hours to get through this legislation.

Alice-Mary Higgins (Independent)
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The Bill is to be guillotined.

Thomas Byrne (Meath East, Fianna Fail)
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There is a point that is fundamental to the country and to the livelihoods of people of this country which is being completely ignored in this debate.

Patricia Stephenson (Social Democrats)
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It is totally disingenuous of the Minister of State to box us all in as the Opposition and to say we are against trade. We are talking about investor courts in this legislation. We are talking about the Arbitration Act and what this Bill will mean for investor courts, with companies being able to sue Ireland for public policy decisions. The Minister of State disagrees with me and I fundamentally disagree with him, but the idea that we are not pro-EU because we have an issue with this, when other EU countries - big players in Europe, including France - have an issue with this and are likely not to ratify the agreement, is wrong. We could renegotiate CETA on different grounds if we wanted to. The European Union has that power. We have seen an increase in relationships in various areas, including security and defence spending, which Canada will be receiving funds for in December. That is a leverage point for us not to have to do this.

Let us get on the record that the Social Democrats and other colleagues in this space are not anti-EU. We are pro-EU. We are critical friends of the EU. We are critical members of the EU because we believe this is bringing us down a dark road, for 20 years, with this zombie clause. It is important we get on the record, in answer to the Minister of State's accusation, that we are not anti-EU because we want to see the EU move in the correct direction. That is not what this Arbitration (Amendment) Bill will do. It is not what the investor courts will do.

Nessa Cosgrove (Labour)
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I want to add that. It is beneath the Minister of State to say we are anti-EU. How can he say that? The Labour Party is pro-EU. We would not bring forward these amendments or spend hours debating this otherwise. The issue for us is also the investor courts. As Senator Stephenson said, other big players, including France and Italy, are not in favour of this and 98% of the trade under this agreement is already happening. We have seen how much trade has increased between our two countries. To say we are anti-EU is totally disingenuous and I would appreciate if the Minister of State were to withdraw his comment.

Thomas Byrne (Meath East, Fianna Fail)
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The Labour Party was in government when this was negotiated so Labour Party ministers would have been in Brussels.

Nessa Cosgrove (Labour)
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We agreed with the majority of the agreement.

Mark Daly (Fianna Fail)
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Allow the Minister of State to continue without interruption, please. Senator Cosgrove will be able to come back in.

Thomas Byrne (Meath East, Fianna Fail)
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I cannot put it any further. The reality is, although the Senators say this is about the investor courts - and in fairness their argument is about that; that is a fact - they keep giving precedents that are not relevant and they also ignore the fact that if we make a decision not to ratify this agreement, the agreement will collapse. That is the language of the Government's regulatory impact analysis. The agreement will collapse and we will lose its benefits.

I do not know whether the Social Democrats, the Labour Party or anyone has told the Commission they think this should be renegotiated. The reality is that the Commission is negotiating many other trade agreements at the moment, all of which would bring serious benefits to Ireland. Each one of them would bring important benefits to Ireland and it is important we continue to make the case for trade and being out there in the world. Any time there is an agreement between two sovereign states, there will be a bit of give and take on both sides, including in this case in relation to the investor protection clause. That is simply the reality. The idea is that there will be an overall benefit, on an overall, practical and non-ideological basis, that it will benefit the people of the country, protect their jobs and protect and enhance the wealth of the country. People have mentioned the close connection between Canada and the EU. The CETA agreement has led to that.

I do not understand the point about using security and defence of the EU as a point of leverage with Canada. Perhaps that can be explained. Perhaps that is the agenda behind this. I do not know.

Patricia Stephenson (Social Democrats)
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I will be brief. We fundamentally support CETA and the trade elements of the Bill, that is, the 99% of the agreement which, as the Minister of State is aware, is already in place. He has said in committee and multiple times on the floor that there is no rush to do this because those bits are in place. We do not need this arbitration clause. CETA could be renegotiated. That is the point I am making. Of course, we are pro-trade and support that, but not when it is at odds with our sovereignty or national courts.

Fiona O'Loughlin (Fianna Fail)
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This is an interesting and important debate. I had the opportunity, along with Senator Stephenson, to visit Canada just before Christmas as part of a trade mission to Washington and Canada. We were in Canada for three nights, one in Toronto and two in Ottawa. I was blown away by the level of investment that already exists and the number of jobs that are dependent on trade between Ireland and Canada. This is fact. Ireland is the tenth largest investor in Canada. Canadian companies employ 22,000 people in Ireland and Irish companies employ 19,000 people in Canada. Two consulates have just been opened in Canada. That is for a particular reason. It is to support trade.

We met several members of the Canadian Government and Opposition who told us the gates were open for trade. They were keen for Ireland to complete the CETA agreement - it has been going on since 2017 - and felt there was a lot of potential and scope there. Given what is happening with relations with Canada's near neighbour, every indication we received was that the doors are wide open to extend trade to Ireland and the EU. As part of our trip, we also went to see Ireland Park in Toronto and the new cultural Ireland House, which will be an incredible space for Irish artists to go to. Therefore, we need to do everything we can to help to protect and preserve the 19,000 jobs in Irish companies in Canada and 22,000 jobs in Canadian companies in Ireland - with lots more in the pipeline - and to grow and promote more.

Sarah O'Reilly (Aontú)
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I move amendment No. 12:

In page 4, to delete lines 14 to 19 and substitute the following:

"(3) For the avoidance of doubt, it is hereby declared that an award made by a body empowered to make awards pursuant to an international agreement to which this section applies is not, and never was, enforceable in the State if enforcing the award would—

(a) conflict with the constitutional order of the State,

(b) conflict with the autonomy of the legal order of the European Union, or

(c) materially impair the capacity of the State to legislate or regulate in the public interest.".

Chris Andrews (Sinn Fein)
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I move amendment No. 13:

In page 4, between lines 18 and 19, to insert the following: “(b) international agreements, conventions or treaties which the State is already party to, including but not limited to:

(i) the Agreement done at Paris on 12 December 2015;

(ii) the 2030 Agenda for Sustainable Development;

(iii) the Convention on Biological Diversity;

(iv) the Aarhus Convention;

(v) the International Covenant on Economic, Social and Cultural Rights;

(vi) conventions of the International Labour Organisation,”.

Nessa Cosgrove (Labour)
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I move amendment No. 14:

In page 4, between lines 19 and 20, to insert the following:

“(4) Without prejudice to the generality of subsection (3) and as non-exhaustive examples of the operation of that subsection, the Constitutional order of the State would be compromised if enforcing an award would expose the State—

(a) to an award of damages, on a strict liability basis, arising from the enactment by the Oireachtas of a law—

(i) the validity of which had been upheld in accordance with Article 34 of the Constitution, or

(ii) the Bill for which had been referred to the Supreme Court by the President under Article 26 of the Constitution,

or

(b) to an award of damages which in substance amounted to a collateral attack on a decision of the Supreme Court that was, by Article 34.5.6 of the Constitution, made final and conclusive.”.

I note the discussion we have just had. We are giving an amendment here that I think the Minister of State could accept. This amendment would clear things up. It is based on the Supreme Court judgment of Mr. Justice Hogan. It is our view that the CETA tribunal decisions will be unenforceable in the Bill. The judgment in the case of when an investor is suing the State before a tribunal for damages arising from the passing of legislation that impairs the investment in some way, a strict liability rule would compromise our domestic constitutional order and the Oireachtas must have the freedom to take policy decisions. I think the Minister of State agreed to that himself.

If, however, the law was challenged domestically and was upheld by the Supreme Court, whose decision is final and conclusive, it would compromise our constitutional order if an investor could obtain an enforceable award of damages arising from the Supreme Court having made that decision. It is clear that assuming the procedural formalities have been complied with and in the absence of some highly unusual defence, such as fraud, the High Court enjoys no real discretion and has little option but to give effect to any award of the CETA tribunal. The fact that in those circumstances the State could thereby be exposed to damages claims on a strict liability basis in respect of otherwise validly enacted legislative measures is sufficient for constitutional purposes since it necessarily compromises the legislative sovereignty of the State, thereby we think it is violating Article 5 of the Constitution.

Another effect of CETA is to allow a body composed of persons who are not judges and who are not appointed - again, we are not anti-EU, this is what we are anti - or answerable to any of the institutions of the State to exercise judicial powers in respect of the State and critically, to give the judgment which is binding and enforceable under our own domestic law. We think again that this is incompatible with the judicial sovereignty of our State and would therefore hold the ratification by the Government of CETA in its present form would infringe again upon Article 5 of the Constitution, read in conjunction with Article 34.1.

The creation of CETA joint committees with the powers to make binding interpretative decisions for the State in respect of important aspects of trade policy and in respect of whose activities the State would have no guarantee of being able to exert direct control or influence means that the necessary democratic control is not present. In these circumstances the conclusion is that the ratification of CETA would also violate the democracy guarantees of Article 5 of the Constitution is inevitable.

We are giving the Minister of State a really good opportunity to accept this amendment, which would alleviate the concerns we have and would actually rely on our own courts system instead of this parallel, new court system.

Laura Harmon (Labour)
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The Minister of State said that the Opposition cannot handle the truth. I would ask him if he is dealing in the real world or auditioning for a role in the film "A Few Good Men". We can certainly handle the truth and we are exposing the truth here as part of this debate. That is what this amendment is about. We, here, in opposition are pro-EU. The Labour Party is pro the European Union and we are pro-trade that benefits Ireland. This amendment would further define the provision in section 25A(3) under which an award would be unenforceable if its enforcement would compromise the constitutional order of the State. It would specify that such an award would compromise the constitutional order of the State and therefore be unenforceable if it would expose the State to damages arising from an Act of the Oireachtas, a Bill referred to the Supreme Court by the President or a Supreme Court decision. The language currently proposed in this section of the Bill is almost laughably vague. It simply states that an award is not and never was enforceable in the State if enforcing the award would compromise the constitutional order of the State or the autonomy of the legal order of the European Union but it leaves those ideas totally undefined.

This amendment is an effort to define precisely what the compromising of the constitutional order of the State would involve. What it would avoid is the awarding of damages in cases where a private investor objects to the provisions of a law that has been passed by the Oireachtas and which has been upheld by the Supreme Court. It would also protect decisions of the Supreme Court itself from such awards. I hope the Government can accept this amendment. It is an entirely reasonable effort to spell out exactly what is being proposed in this Bill rather than asking this House to pass a Bill that leaves vital concepts completely undefined.

As we have said, we in the Labour Party are opposed to investor courts and opposed to this Bill but at the very least, we should be clear about what guardrails we can propose as part of this Bill.

Thomas Byrne (Meath East, Fianna Fail)
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As I have already said on a number of occasions, the Government, with the assistance of the Attorney General, has carefully considered the Supreme Court's findings in the Costello case. We take everything in the round on that. The amendment seeks to provide a partial definition of the meaning of the term "constitutional order of the State" but the Bill intentionally does not include a definition. This is because the term has previously been referenced by Irish courts in their case law. It would be a matter for determination by the High Court or Supreme Court in any cases regarding the enforcement of awards in the State under the Act. It is for the courts to act as the guardians of the Constitution. It is not for the Executive or indeed for the Parliament to be prescriptive about what constitutes the constitutional order of the State. It is therefore a matter for the courts to determine what constitutes a threat. We believe that the proposed amendment is unnecessary and overly prescriptive and therefore, we are not able to agree to accept it.

Nessa Cosgrove (Labour)
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As Senator O'Loughlin said as well, we can see already that in respect of the trade, we have really good trade relationships with Canada. We know this. I just do not understand why an amendment like this would not be put in. The Minister of State has said that it is too prescriptive but it is protecting us and protecting our own judicial system. Why would we not want to put this in? What is wrong with putting it in? If the Minister of State is not concerned about investor courts why not put this in? Work it the other way around. What harm is it going to do if the Minister of State is not concerned about it? There are ten other countries in the EU that have not agreed to this either. Like we said, they are big players like Belgium, Italy and Poland. It can be renegotiated so I do not understand that. We have seen how much trade has increased and to reiterate, we are pro-trade. We have seen how much trade has increased between our two countries. Why not have a protection like this that will protect our Constitution and courts system?

Alice-Mary Higgins (Independent)
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It does not narrow it. The language is very clear. The amendment states, "Without prejudice to the generality" and refers to "non-exhaustive examples of the operation of subsection (3)". There is nothing in amendment No. 14 that closes the frame or the discretion of the High Court. What it does is make clear very important instances whereby a Bill had been referred to the Supreme Court by the President, for example. We know that it is the case that if a Bill is referred to the Supreme Court by the President and that Bill is found to be constitutional that no individual may take a case in relation to that Bill. Its legality is so confirmed. The amendment is simply saying that the same kind of standard would be applied and that there would not also be a situation where a company would be able to seek compensation in relation to a measure contained in a Bill which had been given that imprimatur from the Supreme Court. That is a really important point. This is a situation where individuals would not be able to take cases in relation to the effects that the Bill may have on them but unless we are very clear there is the concern or danger that a corporation would be able to seek measures to ameliorate the impact of that measure on its finances, were those found to be unfair or inequitable. This is why it is important that the High Court would be empowered explicitly to be clear that it would be consistent with a very long-established practice of the precedence of rulings of the Supreme Court, particularly when referred to by the President.

Thomas Byrne (Meath East, Fianna Fail)
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I cannot explain it any further. I will not accuse anyone of a misunderstanding but the fact is that the right to regulate is contained within the CETA agreement. It is the investor courts that are bound by that. This legislation relates to enforcement of awards and we are saying that we have drafted this very carefully to comply with the suggestion given to us in the Supreme Court case.That has been done carefully over a period of time. It is not possible then for me to accept other amendments in relation to that, which would go against the process that we have already had to implement this legislation that will allow us to ratify CETA in a constitutional way.

The right to regulate has already been dealt with extensively in the CETA agreement. The CETA agreement does not affect the State's right to regulate and the idea that corporations could seek to ameliorate their position by taking High Court cases here is not the procedure. A corporation could potentially take a case to an investor court but the law is clear that cannot impact on the State's right to regulate, which essentially, for a large part of it, is its legislation.

Alice-Mary Higgins (Independent)
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That is not the discussion point.

Thomas Byrne (Meath East, Fianna Fail)
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That is well covered. This legislation is about the enforcement of any awards at international level and that is what the constitutional problem was in the Costello case. The judge in the Costello case has said that if the Government wishes to ratify CETA, it will have to change the Arbitration Act and here is a way, the judge suggested, the Government could do it. We have considered that carefully. We have read the judgments as a whole and we have taken the Attorney General's advice. In that context, we drafted the legislation that we have. I, therefore, cannot accept amendments in relation to it.

Alice-Mary Higgins (Independent)
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It is clearly in relation to enforcement. That is what the amendment is in relation to.

Nessa Cosgrove (Labour)
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And the Attorney General does get it wrong.

Chris Andrews (Sinn Fein)
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I move amendment No. 15:

In page 4, between lines 19 and 20, to insert the following:

"(4) For the avoidance of doubt, awards under an international agreement referred to in subsection (1) shall not be enforceable or recognised in the State if such awards were sought in a foreign jurisdiction or an international body.".

Sarah O'Reilly (Aontú)
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I move amendment No. 16:

In page 4, between lines 19 and 20, to insert the following:

"(4) No award shall be enforceable under this section where the award arises from a measure adopted by the State in the exercise of its legislative, regulatory or administrative powers for a public policy objective including public health, environmental protection, climate action, housing policy, labour protection or the protection of public services.".

This amendment is necessary because it provides a clear and explicit protection for the public policy measures adopted by the State. The amendment states that no award shall be enforceable where it arises from measures taken for a legitimate public policy objective including public health, environmental protection, climate action, housing policy, labour protections or the protection of public services. I do not believe that should be controversial.

Alice-Mary Higgins (Independent)
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I was wondering would it be possible to move a grouping in respect of amendment No. 16? Can I move a grouping?

Mark Daly (Fianna Fail)
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It is Senator O'Reilly's amendment.

Sarah O'Reilly (Aontú)
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I would like to group amendment No. 16 with two other amendments. Can I?

Mark Daly (Fianna Fail)
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I will have to get the agreement of the House. Does the Senator want to group amendments Nos. 16 and 17?

Alice-Mary Higgins (Independent)
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No, amendments Nos. 20, 21 and 25.

Sarah O'Reilly (Aontú)
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Can I group amendment No. 16 with amendments Nos. 20, 21 and 25?

Mark Daly (Fianna Fail)
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We have not got to those amendments yet. Is Senator O'Reilly trying to put amendments Nos. 16 and 17 together with-----

Alice-Mary Higgins (Independent)
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No, amendments Nos. 16, 20, 21 and 25.

Sarah O'Reilly (Aontú)
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Amendments Nos. 16, 20, 21 and 25.

Mark Daly (Fianna Fail)
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Okay. Is it agreed to group amendments Nos. 16, 20, 21 and 25? Agreed.

Sarah O'Reilly (Aontú)
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I reiterate I do not believe that this should be controversial. Throughout this debate, we have heard repeated reassurances that CETA does not undermine the State's right to regulate. If that is truly the Government's position, there should be no objection to placing that protection directly into Irish law.

The concern many people have is not theoretical. We have seen globally how investor dispute mechanisms have been used against environmental protections, energy transitions, public health measures and democratic decisions taken by sovereign states. We have seen the tobacco companies pursue states over health warnings. We have seen energy corporations seek enormous compensation when governments attempt to change environmental policy. We have seen public authorities threatened with litigation simply for attempting to regulate in the public interest. This issue is not merely whether a state technically retains a right to regulate. The issue is whether exercising that right comes with a threat of massive financial penalties that create a chilling effect on democratic decision-making.

Housing is a particular important example in the Irish context. Future Governments may need to take stronger action in housing markets, land use, rental regulation or public provisions. Public health emergencies may require swift intervention.

Governments must retain the freedom to act without fear that multinational corporations can seek compensation. This amendment simply states that measures adopted for legitimate public policy purposes should not give rise to enforceable awards against the State.

Alice-Mary Higgins (Independent)
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We looked for the grouping because there are multiple examples that we could give. Amendment No. 16 gathers a number of them together.

Moving away from the question of what do we need to do to get this passed, those public concerns that related to the investor court components of CETA still stand and have not been addressed. There is a reason whereby anytime a light has been shone on this issue, there has been concern. For example, when the European affairs committee looked at these investor court components, even though there was a Government majority on that committee in the previous Oireachtas, it came down with a 50:50 split. They did not come down in favour of the passing of the investor court component of these agreements.

We are moving between the two here. This Bill is about the enforceability and then a lot of the discussion that the Minister of State is asking us to lean into is to constantly reference the fact - bearing in mind that the ICS is only one of the mechanisms possible under the Bill in terms of other agreements - that you do not have precedents from there but that is because it is not established yet. In terms of fantasy and in terms of living on a hope and a dream, the person who is in a position here in this regard, namely, the Minister, is saying that we should not look to what has happened for the past 20 years and the multiple examples of these arbitration dispute mechanisms, the full gamut of which may come in under this legislation. He is saying that we should not look to everything that has ever happened, not in some abstract way but here in Europe and right across the world. The Minister is saying do not look to everything that has ever happened; look to what the Government hopes is going to pan out in this future untested mechanism where very credible people, including, for example, the German judges association, have pointed to the fact that there are not substantial enough differences.

On that point of being right and wrong, the fact is the Minister of State is saying we responded. It was pulled kicking and screaming to make changes. The changes that were made were not like some spontaneous effort. They were made by people who criticised the previous system and were correct. Moreover, the criticisms being made now are made by the same people who were right then. In 2016, I brought my first Private Members' business to this House, which passed. It was a motion stating that the EU-Singapore ruling is about to happen and they are almost definitely going to say you have to treat the investor courts bit and the trade bit separately. The Government then disagreed with me and it was wrong. Therefore, the record of who has been right and who has been wrong on this issue is that we were being told there was not a problem about the Energy Charter Treaty, which now everybody has to leave. My amendment No. 20 relates specifically to the ability to achieve our climate action targets. We were told not to worry about that and that it would not affect those issues and yet, Europe has had to withdraw and now Ireland has had to withdraw, specifically because it will block the achievement of our carbon climate targets. In fact, the UN body, the Intergovernmental Panel on Climate Change, IPCC, has named investor dispute mechanisms as a whole, not one particular one but all of them, as one of the main blocks to achieving the climate policy changes that we need in order to deliver a liveable planet. Therefore, there is a litany of record and evidence of how this goes, including in the language of those legal companies that tend take this cases and plan to take these cases, and yet there is this plan of preposterous suggestion that we should not worry; it will never happen.It is like saying, "I am just so confident it will never happen that I am willing to sign us up to something". Not only is there a 20-year zombie clause, but we are choosing to accept and give sovereignty to these investor courts. Once done, we cannot take that back on our own. We need the entire European Union to do so.

The Minister of State mentioned the right to regulate. Everybody has been explicitly clear. We know the Government can make the law. The question is what it will cost and whether that becomes an obstacle. The obstacles are clearly set out.

The Minister of State also mentioned these interpretive agreements about keeping the existing standards, but we have a number of areas which are under-regulated. Does he believe our current action on climate will deliver enough? No, it will not. When we seek to strengthen our policies on climate we will meet challenges. We have seen challenges under the Energy Charter Treaty. Ireland is being challenged right now. We will see challenges if we try to strengthen our climate laws.

Home care is an under-regulated area. Despite promises to put it on a statutory basis in the programme for Government, that has not been delivered. When we make that move, we will have exposure because one of the largest actors in that area is a large Canadian company. If we seek to further regulate in the rental area, we will find that the largest landlord in the State is a Canadian company. It is extremely credible and factual that there is a risk now attached to policy and legislation in areas of crucial public policy. A cost may be attached to it due to findings made under this.

That is what arbitration bodies can do. The Minister of State can say we do not know what they will do or that maybe they will not do it or he does not think they will do it. That is where we are at. We know the others will do it because they have done it in the past. Those who critiqued correctly the previous agreements have also said that the ICS is slightly less secretive but operates in a very similar way. Those who were right in the past are telling us that there is a problem with the new system. That is the case. That is the arbitration bit.

What we are talking about here is the enforcement bit. This is not just about what Mr. Justice Hogan said the Government had to do to get CETA through.

Thomas Byrne (Meath East, Fianna Fail)
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He did not say that we have to do it.

Alice-Mary Higgins (Independent)
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He suggested what the Government could do to try to get the fast-track ratification the Government had attempted, and to make that okay for the future. This is the Government's framing of that ruling. We are not talking about that in amendments Nos. 16, 20 or 21. We are simply asking whether the Minister of State believes that the High Court should be required to allow enforcement of an award which may compromise the State's ability to achieve the objectives of the Climate Action and Low Carbon Development Act. Does he think the High Court should have the opportunity to define enforcement of an award when it arises from legislative and regulatory measures the State has taken in all of those important areas listed by Senator Sarah O'Reilly, including labour protection and the protection of public services? This is not a matter of what the court said the Government had to do to get its preferred mechanism of ratification to fly. This is a matter of "Yes" or "No". Does the Minister of State believe that awards made by arbitration bodies in relation to the impact of public policy measures in these areas should be enforceable on the State?

We disagree on whether those arbitration bodies will make awards on these areas.

Thomas Byrne (Meath East, Fianna Fail)
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That is a fundamental point.

Alice-Mary Higgins (Independent)
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Does the Minister of State believe that if they do make awards, they should be enforceable? If an arbitration body makes an award in an area related to an impact of an area of public policy, should that be enforceable?

Amendment No. 21, which is grouped with this one, addresses public procurement and compliance with the Irish Human Rights and Equality Commission Act. If actions are taken in relation to a public procurement decision based on the obligations of public duty, equality and human rights, should a measure taken in that way be subject to an award that can be enforced in Ireland?

On amendment No. 25, I will not reiterate the points I made because this relates to the public interest question we discussed previously.

When people are concerned about this, they are concerned about what the impact of the enforcement of these measures and the enforcement of fines in relation to these policies may have. There are two issues. The first is the chilling effect in terms of whether it affects public policy. I will come to that in further detail in a later amendment. The second is the cost of these awards. We are looking at awards that relate to future unearned profit, not just the loss on a previous investment but a loss based on reasonable expectations of money someone was planning to make. The awards have been stratospheric. Senator Andrews pointed to that. There have been €100 billion in awards made under these kinds of arbitration mechanisms. These powers that the Minister of State is designating, or these responsibilities in terms of the decision being given to the High Court, do not just relate to CETA. They relate to any agreements made under this legislation. They also relate to any other agreement that may be made, which may have any other form of investor dispute mechanism attached. That will be voted on by the Oireachtas, but the point is that we do not know which kinds of systems will be feeding in awards and then enforcement will be sought. Where does the Minister of State stand on this? The risks are clear. Even if the Minister of State thinks differently about the risks and believes these cases will not arise and awards will not be made in relation to measures that might be taken, why block these amendments?

Thomas Byrne (Meath East, Fianna Fail)
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The Senator has accused me of being in a fantasy here. The reverse could be argued to be true as well. She talked about stratospheric awards. That is the vista in front of us if we are to pass this legislation. She has moved on the debate now because she has lost the question on the right to regulate. She is saying that the State can regulate-----

Alice-Mary Higgins (Independent)
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Sorry, with respect-----

Mark Daly (Fianna Fail)
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Sorry, can the Minister-----

Alice-Mary Higgins (Independent)
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-----the right to regulate argument is not lost. We have always been clear. It is the cost of regulation that has been explicitly clear.

Mark Daly (Fianna Fail)
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The Senator is not allowed to interrupt.

Thomas Byrne (Meath East, Fianna Fail)
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That is changing the foundations of the argument. The Senator is not saying what some Senators said, namely, that we would not be able to regulate these things. What she is saying is that if we do, we will get fined. I have outlined at length-----

Alice-Mary Higgins (Independent)
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That is what everybody has said. That is the case. What everyone has said is that it will have a dissuasive effect on the ability-----

Thomas Byrne (Meath East, Fianna Fail)
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Not everybody has said that.

Alice-Mary Higgins (Independent)
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It will materially compromise the ability to regulate.

Thomas Byrne (Meath East, Fianna Fail)
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I have not said that.

Mark Daly (Fianna Fail)
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Allow the Minister of State to proceed without interruption.

Thomas Byrne (Meath East, Fianna Fail)
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The Government has not said that. The CETA agreement says the opposite, as does the CETA joint interpretative instrument. The European Court of Justice said the opposite. All the legal advice said the opposite.

On the companies the Senator mentioned, it is very unfortunate that we have started to bring individual companies into the debate as if they are some threat to the State. I do not know those companies or who they are, but it is not fair to mention them in the Seanad as some kind of threat to the State. The legal advice those companies will have is the same as the legal advice the Government is receiving and I am outlining here. They would not have a right to sue the State in the circumstances that Senator Higgins and many others described. This is well established. It could not be written any clearer. It is simply not the case that the right to regulate is accompanied by some cost. That is a moving on of the argument. It is a moving of the ground of the argument because the argument does not stand up. We could not be clearer that this does not arise. I have said this at length. The courts have said it at length. Some Supreme Court judges have stated this as well. I cannot put it any further than this - what the Senators are saying is simply not correct. This is about investment. We want Irish companies to do in Canada what Canadian companies are doing here, which is investing, providing services, selling goods and employing people. That is what we want to do because that is how we raise our funding for the State - by generating taxes - and it is how people can get jobs, employment and have the good life.There is a fundamental disagreement on this between both sides of the House.

Patricia Stephenson (Social Democrats)
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On that point, I go back to that piece around the cost of public policy and the chilling regulatory effect on nation states and governments, which we have seen evidenced in other cases. I also mentioned previously that the Minister of State acknowledged on Committee Stage in select committee: "If an Irish government were to say it is going to seize all the houses owned by Canadian pension funds at a price of half their value but would not touch any other properties, those funds might have a claim in an arbitration court or even in the Irish courts under Irish law."

I recognise the Minister of State used a very extreme example but-----

Thomas Byrne (Meath East, Fianna Fail)
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Yes, but the Irish law would apply for them too.

Patricia Stephenson (Social Democrats)
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The Minister of State used a very extreme example but that is still an example of there being the ability of funds to claim. What Senator Higgins touched upon at length is that idea of fair and equitable treatment and that being open to interpretation. She also referenced the Beyond Barriers report document quite a lot and the active engagement that we have done to invite people to invest in Ireland under certain terms. The risk is that if those terms change we are opening ourselves up then. Those arguments are really clear and strong and I cannot fathom why we interpret them on such different basis.

Thomas Byrne (Meath East, Fianna Fail)
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The terms under which people invest in this country are the laws of the land, trade agreements that are relevant to their particular operations or maybe their place of operation. They are the terms. The trade agreement in this case and the other cases that would come in under this legislation specifically point to the fact that the State can continue to regulate. I can say with 100% confidence that no Government decision has ever considered whether there is a regulatory chill on the Government because of the Canada trade agreement. The Government is subject to regulatory chill at times. The Constitution prevents the Government doing certain things that political parties may want to do from time to time. That is a prevention of what the Government is doing. However, I can say with almost complete certainty that this has not arisen in the case of CETA.

I also want to contradict one point that was made earlier to the effect that there was some process to fast-track CETA. There is no process to fast-track the ratification of the agreement. The Constitution provides the ratification process for that. All this legislation is doing is enabling us to do that process in a constitutional way but that process is set out in the Constitution.

I want to be clear that the right to regulate provisions means that the mere fact that the interests of an investor are adversely affected by measures taken to protect the public interest will not amount to a breach of the agreement. However, if there is an added element of abusive treatment, manifest arbitrariness, targeted discrimination or some equivalent behaviour on the part of a party, then it is that behaviour that could bring a claim within the scope of CETA and potentially result in liability for the party concerned. The Government and the text of the agreement itself do not agree that this in anyway hollows out the protections of the right to regulate; indeed, many of those activities described would be not permitted under the Constitution in any event.

Alice-Mary Higgins (Independent)
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I would like the Minister of State to clarify something. He mentioned that the Government has never considered CETA in relation to anything because, of course, we have not had the investment clauses, though I would have hoped there would have been a risk analysis in relation-----

Thomas Byrne (Meath East, Fianna Fail)
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There is a risk analysis.

Alice-Mary Higgins (Independent)
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-----to any of those. Specifically-----

Thomas Byrne (Meath East, Fianna Fail)
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The risk is that we would collapse the agreement if we do not ratify it.

Alice-Mary Higgins (Independent)
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I would like the Minister of State to clarify whether the Energy Charter Treaty has been considered in relation to any legislative or regulatory decisions? Has there been consideration of the potential impact of litigation under the treaty and its investor components? Has that ever been a factor in any decision-making by the State?

He also mentioned that some of these large companies have the same advice that he has. Has he engaged with large Canadian companies in relation to their expectations of how this will operate?

Thomas Byrne (Meath East, Fianna Fail)
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On the Energy Charter Treaty, again, what is happening here in this House is a conflation of two different systems. The system we are debating under CETA has been specifically designed with the experience under the Energy Charter Treaty and other agreements fully in mind. The Government has a regulatory impact assessment and it is publicly available to anybody. There are no costs to the State arising from CETA. In a case where it is determined that there has been a material breach, the ICS could require a state to pay monetary damages, but investors cannot be given compensation just because they have lost profits, sustained economic loss or incurred costs.

Alice-Mary Higgins (Independent)
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They were "Yes" or "No" questions. It was simply a "Yes" or a "No" to whether the State has considered or factored in the Energy Charter Treaty when making decisions on legislation policy or regulation and whether the potential risk of litigation under the treaty had been a consideration in any of those processes. Then the other simple question related to the companies. The Minister of State stated that the companies have the same legal advice he has. None of us has the Attorney General's advice, so I do not know if the Minister of State means that the companies have similar legal advice. I was asking what engagement there had been with large companies around the expectations of how this is likely to operate.

Thomas Byrne (Meath East, Fianna Fail)
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All I can say is that we are dealing with two different animals and the second one has been created and devised because of the experience of the previous one. I will quote from the regulatory impact analysis:

... the State’s exposure to economic loss cannot be regarded as materially impacted arising from the introduction of the ICS mechanism provided for within CETA, and especially given the already existing recourse inward investors from any jurisdiction have [in] the domestic courts. Furthermore, it must be noted that CETA preserves the right of each EU Member State to regulate in [the] public interest.

Alice-Mary Higgins (Independent)
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It was a "Yes" or "No" question, with respect.

Thomas Byrne (Meath East, Fianna Fail)
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I was asked about the regulatory impact assessment and-----

Alice-Mary Higgins (Independent)
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The Minister of State has answered on that and then I came back with a specific question.

Thomas Byrne (Meath East, Fianna Fail)
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What is being continually thrown in every contribution is that this is completely incorrect. What Senators are basing it on is on a different system. They are basing it on something that is not only not in the text of CETA and the various documents and court decisions surrounding it, but the very opposite of what they are saying is written in black and white in CETA, the interpretative instrument and court decisions, including our own Supreme Court decisions.

Alice-Mary Higgins (Independent)
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I am going to assume from the Minister of State's lack of answer that the Energy Charter Treaty has been a factor in the making of regulation, legislation or public policy, and the threat of suit under that. That is something to note as we come to later amendments around the chilling effect.

Maria Byrne (Fine Gael)
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Would the Minister of State like to respond?

Thomas Byrne (Meath East, Fianna Fail)
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I cannot put it any further.

Sarah O'Reilly (Aontú)
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I move amendment No. 17:

In page 4, between lines 19 and 20, to insert the following: “(4) The Minister shall publish, as soon as practicable, any application for enforcement under this section, any award made pursuant to such application and any settlement entered into by the State in respect of such award.”.

I will keep it short and sweet so we can move on. The amendment just proposes that the Minister publishes any application for enforcement under this section, any award made pursuant to such an application and any settlement entered into by the State in relation to such awards. This is the bare minimum that should apply where potential enormous liabilities may arise against the State. If these mechanisms are to exist at all, the public has a right to know when claims are being pursued, what awards are being made and whether settlements are being entered into on behalf of taxpayers.

Thomas Byrne (Meath East, Fianna Fail)
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The amendment appears to be based on the premise that somehow these investor courts, and, indeed High Court decisions, would lack transparency. This is not the case. CETA and similar agreements ensure transparency of proceedings for full public scrutiny.All substantive materials, including the request, the written submissions by the party, the decisions of the first instance tribunal and-or appeal tribunal will be publicly available. Hearings will be open to the public. Interested parties, that is, NGOs and trade unions, would be able to make submissions, aided by publicly available materials. Any domestic proceedings are held in open court. The amendment seems to be partly premised on the fact that Irish court decisions could be made behind closed doors. That would not be the case. It would be on the news or on "Six One", if this were ever to happen. It is not going to happen. The idea that there would be any kind of enormous liability is again in the category of the scare stories we have heard. There is nothing secret about this and there is nothing secret about the Irish court system. The system in CETA has been specifically designed to be transparent and to allow for full public scrutiny.

Alice-Mary Higgins (Independent)
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I move amendment No. 18:

In page 4, between lines 19 and 20, to insert the following: “(4) Where an applicant is seeking leave from the High Court for enforcement of an award pursuant to an international agreement, the applicant shall demonstrate to the satisfaction of the High Court that the enforcement of that award shall not compromise—

(a) the constitutional order of the State, or

(b) the autonomy of the legal order of the European Union.”.

I believe amendments Nos. 18 and 19 are grouped. If they are not, I propose that they be grouped.

Maria Byrne (Fine Gael)
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Is that agreed? Agreed.

Alice-Mary Higgins (Independent)
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Amendments Nos. 18 and 19 simply refer to the language in the Bill. Regarding the current language used in the legislation, concerning awards not having been enforceable and never shall be enforceable, it is very hard to see how this applies in relation to the energy charter treaty and so forth. Leaving that aside, these amendments simply try to ensure that a burden of proof is placed on the applicant. Rather than the State having to challenge the enforcement of an award by claiming it would "compromise the constitutional order of the State" or "the autonomy of the legal order of the European Union", there would be an onus on the applicant, that is, the company seeking to have an award enforced, to demonstrate that the enforcement of the award would not compromise the constitutional order of the State or the autonomy of the legal order of the European Union. It just shifts the burden of proof onto the people seeking the enforcement of an award. It would be for them to demonstrate that it does not compromise these aspects. These are straightforward amendments.

Thomas Byrne (Meath East, Fianna Fail)
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As I stated previously, with the help of the Attorney General, the Government has carefully considered the Supreme Court’s findings in the Costello case, and the legislation sets out the response, including specification of the grounds on which an award is not enforceable. The Senator’s amendment seeks to amend and expand what are carefully considered positions. I note that the Senator's amendment goes into the detail of the legislation, and the premise of the amendment actually accepts what we are trying to do.

Alice-Mary Higgins (Independent)
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It does not.

Thomas Byrne (Meath East, Fianna Fail)
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The premise of the amendment accepts what we are trying to do. The Senator just wants to improve it. The procedure in relation to the new section 25A would follow the 2010 Act and the relevant rules of court. For these reasons, we are unable to agree to amendment No. 18.

Alice-Mary Higgins (Independent)
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My amendments certainly do not represent an acceptance of the premise of the mechanism and its credibility. They are simply trying to ensure that we would have a guarantee of proper High Court scrutiny, with an evidence base, in relation to every instance of enforcement. I do not see why we cannot have a proper review in relation to every instance of enforcement and proper consideration, rather than simply in instances where that enforcement may be challenged. If the Minister of State envisages, as he suggested, so few awards being made and so few attempts at enforcement, then why not have a bar that would ensure the High Court would be provided with evidence in relation to those instances in terms of their compatibility with the law?

Thomas Byrne (Meath East, Fianna Fail)
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I do not think the Constitution requires us to guarantee a fair High Court decision, which seems to be the premise of what the Senator is saying. I cannot accept the amendment.

Amendment put and declared lost.

Alice-Mary Higgins (Independent)
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I move amendment No. 19:

In page 4, between lines 19 and 20, to insert the following: “(4) Where an applicant is seeking leave from the High Court for enforcement of an award pursuant to an international agreement, the applicant shall demonstrate to the satisfaction of the High Court that the enforcement of that award shall not compromise—

(a) the constitutional order of the State,

(b) the fundamental principles of the constitutional order of the State,

or

(c) the State’s obligation (reflected in Article 29.4.4 of the Constitution) to give effect to European Union law (including the Charter of Fundamental Rights and Freedoms) and to preserve its coherence and integrity.”.

Alice-Mary Higgins (Independent)
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I move amendment No. 20:

In page 4, between lines 19 and 20, to insert the following: “(4) The High Court shall have full discretion to refuse leave for enforcement of an award made pursuant to an international agreement to which this section applies where enforcement of that award would compromise the State's ability to achieve the objectives for in the Climate Action and Low Carbon Development Acts 2015 to 2021.”.

Alice-Mary Higgins (Independent)
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I move amendment No. 21:

In page 4, between lines 19 and 20, to insert the following: “(4) The High Court shall have full discretion to refuse leave for enforcement of an award made pursuant to an international agreement to which this section applies where that award was in relation to a public procurement decision made to ensure compliance with section 42 of Irish Human Rights and Equality Commission Act 2014.”.

Alice-Mary Higgins (Independent)
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I move amendment No. 22:

In page 4, between lines 19 and 20, to insert the following: “(4) The High Court shall have full discretion to refuse leave for enforcement of an award made pursuant to an international agreement to which this section applies where the calculation of that award has been affected by any repeal or modification of the measure giving rise to that award.”.

This amendment goes to the core of what everybody has been saying throughout the debate, despite the litany of references to the right to regulate, namely, what is being talked about is the compromising of regulation, lawmaking and policymaking because of the economic impact. This is not a shift in the position. That has always been the case and is how it has often worked. I have given a litany of examples whereby companies have demonstrated that just by taking a case, they get to change the law. Vermilion, by threatening its case against France, got a change in the French climate law. The company got it diluted. The minister for the environment in that country was explicitly clear that was what had happened.

There are multiple examples. Togo passed a decree in 2012 requiring health warnings text to cover 65% of tobacco packaging. British American Tobacco and Philip Morris claimed the rules violated their trade rights under investor-state dispute settlement, ISDS, and Togo was forced to scale back its plans. What was really important was that this was then given as the example to intimidate other jurisdictions from bringing in similar laws. It is only necessary to threaten to bring a case against one country and have it fold to create a chilling effect, where other countries may not attempt similar legislation.

I will expand on this point in case there is any doubt at all that this chilling effect is part of the designed functioning of not just CETA but also the many other investor trade dispute mechanisms we may be signing up to in this Bill. In terms of CETA, the text of that agreement states that, "For the calculation of monetary damages, the Tribunal shall also reduce the damages to take into account any restitution of property or repeal or modification of the measure." It is literally there in black and white concerning what happens when it is being decided how much money a state will have to pay. The litany of awards has been huge. These are not small awards - they have run into hundreds of millions and even billions. This is what we have seen in the last few years.

When it is being decided how big the bill will be, a tribunal will weigh up whether a law was repealed or modified. This is what is on the table. To be really clear, whatever about the right to regulate, in terms of the cost of making regulations and laws that reflect the actual will of the Irish people, their concerns and what they want to happen in a litany of areas we have heard about, right through from the environment to housing and public health, which has been a particular target of these kinds of cases, that is what is on the table. The Minister of State mentioned that the secrecy has been removed. I recall that I had to go and read the Transatlantic Trade and Investment Partnership, TTIP, in a private room with a pencil. That is where we were. The bar has not moved so much because there can still be requests for privacy in relation to certain parts of the detail of an adjudication. What is on the table when the bill attached to any law or public policy measure is being decided in these arbitrations is whether there was a willingness to compromise that law. That is the direct language. There is a reference to repeal or modification of a measure, namely, whether a country has been willing to repeal or modify a law. It is there on the bill.That is in the text of CETA, which does not seem to have moved on that much. Why have the right to regulate and then say "By the way"? We can regulate but whether we are willing to compromise on those laws is going to affect how big the rulings made against us will be. It will affect the size of the award that might be made. The chilling effect is built in. Leaving aside the chilling effect that happens due to the threat of a case and in terms of the cost of a case - by the way the costs are huge for cases for states, win or lose - if we do get to the table on this case, and if it does proceed, we will be under pressure to compromise on our law in order to ensure a lesser award.

What I am simply saying in amendment No. 22 is that the High Court should not be asked to reward that. The High Court should have full discretion to refuse the enforcement of an award made under one of the many international agreements that may come in under this Bill, where the calculation of that award has been affected by repeal or modification of the measure giving rise to the award. If the amount of money that is being sought to be enforced against the Irish State has been affected by a compromise on the part of the Irish State in relation to the repeal or change to a law, that should not be enforceable in Ireland. Will the Minister of State clarify exactly where he is on that part of the enforcement piece in terms of being told this is how it operates? It is how this one operates too. It has been extremely effective.

Thomas Byrne (Meath East, Fianna Fail)
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The amendment proposes to assign a broad and ill-defined discretion to the High Court regarding the enforcement of relevant awards. I again repeat that we are designing this following the Supreme Court decision on the Costello judgment, in particular the comments of Mr. Justice Hogan. In CETA, there are specifications regarding final awards. Article 8.39 sets out the specifications regarding final awards in relation to the measure or measures challenged in the claim. The tribunal may only award monetary damages or restitution of property, with the right of the State to pay monetary damages instead. The article specifies that monetary damages shall not be greater than the loss suffered by the investor or, as applicable, the locally established enterprise, reduced by any prior damages or compensation already provided. In the calculation of monetary damages the tribunal shall also reduce the damages to take into account any restitution of property or appeal or modification of the measure. This provision is in keeping with the trend of limiting available remedies for investors and, contrary to the Senator’s assertions, is in line with the goal of preserving the regulatory space of states. I completely reject the proposition argued here that the provisions in CETA restrict the protections and the right to regulate and increase the risk of regulatory chill. In fact, arguments relating to the right to regulate would have to be considered by the tribunal before an award is made. As noted, the right to regulate in the public interest is protected in these agreements. These provisions mean that the mere facts that interests of an investor are adversely affected by measures taken to regulate in the public interest will not amount to a breach of the agreement. That will not happen. However, if there is an added element, for example, abusive treatment, manifest arbitrariness, targeted discrimination or some equivalent behaviour on the part of a party, it is that added element that would bring a claim within the scope of the agreement’s protections and thus potentially result in liability for the party concerned. I have given some extreme examples of where that might happen that Irish companies would have protection for in Canada as well, which is an added part. In such cases where a violation has been found and an award has been granted, the tribunal cannot order a change to the measure giving rise to the award, but the respondent party could choose to make a change. If such a measure is repealed or modified – this is in a case where a violation has been found, and that violation will not be found based on the right to regulate – it is appropriate that the award would be reduced to reflect this change. A number of things have been conflated here in the argument of the proposers. For that reason, I am unable to agree to this amendment.

Alice-Mary Higgins (Independent)
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I move amendment No. 23:

In page 4, between lines 19 and 20, to insert the following: "(4) The High Court shall have full discretion to refuse leave for enforcement of an award made pursuant to an international agreement to which this section applies where the applicant of such enforcement is in receipt of public grants, public investment monies or public procurement contracts related to the circumstances of the award."

What the Minister of State has just described is exactly as it is: when rulings are made, compromising on those laws and on those measures can be a consideration. That is directly the chill effect in practice. That comes to this piece here. The Minister of State leant on the fact and he keeps using the phrases "the right to regulate" and "the mere fact". That means on its own it is a fact that it is not a consideration if a company would lose profits. It is not the mere fact, it is the fact combined with what the Minister of State described as abusive treatment and so forth. Those categories of what constitutes abusive treatment are the basis on which the awards are made and that is wide open in itself to abuse.

Indeed, Ireland is extremely vulnerable under a number of those categories. Here is one that is really clear. It has been asked about repeatedly, including by Senator Sarah O'Reilly and others. When applying the fair and equitable treatment obligations, which is one of the grounds on which those awards could be made, consideration must be given not only to whether a company loses profits but also to whether it was treated unfairly and inequitably in regards to that. That is the key point. That is the situation whereby an award may be made, and that is the situation whereby a government may be offered the opportunity to repeal a law or change it in order to reduce the bill. While the fair and equitable treatment obligation has not so much changed - it is set out more clearly compared to some of the previous obligations - the basic grounds are the same. It also has subsection (f), which allows for other things to be added under fair and equitable treatment in the future. It is not a closed box of circumstances applying to fair and equitable treatment in terms of CETA.

As I keep saying, this is not the only piece. There will be other worse agreements as well, potentially. In terms of this one, the category of fair and equitable is not a closed box. It can be expanded. The text of CETA explicitly states:

When applying the ... fair and equitable treatment obligation, the Tribunal may take into account whether a Party made a specific representation to an investor to induce a covered investment, that created a legitimate expectation, and upon which the investor relied in deciding to make or maintain the covered investment, but that the Party subsequently frustrated.

The point that was made relates to whether we have created inducements or encouraged a company to invest. For example, the IDA may have given them a grant or encouraged them to do so. We have a list. In the Beyond Barriers report that looked at trade, most of the areas of trade are all covered already and do not require the investor clause to operate. One of the things that Canadian companies mentioned is that they like the really proactive measures the Government takes to invite them and encourage them to invest. That is good, of course; that is what we should be doing. Nobody is against that, but the problem when we choose to make ourselves liable to an arbitration tribunal is that those measures such as making specific representations to investors, or inducing or encouraging an investment, are in themselves a consideration in whether that company was unfairly or inequitably treated. I give the example of a very large REIT, which was encouraged to enter the rental market in Ireland, and then new rental regulations come in.It may well go that it came in and subsequently the party, that is, the State, has frustrated the expectations it had in relation to the investment the State encouraged it to make. That is a wide-open goal in terms of rulings against the Irish State. There are multiple examples again here. The fact is that this proactive encouragement to business should not come with a risk attached and by choosing to make ourselves vulnerable to the decisions of these arbitration tribunals, we are unnecessarily rushing to create a new risk attached to the encouragement of investment. Incidentally, not having the investor court has not been an obstacle to it. We heard the Canadian ambassador say that there has been no obstacle with our other courts.

Companies, of course, prefer these courts. With respect, it is not about mere fact, it is the fact plus the behaviour of the State, and the provision of fair and equitable means is wide open to be used by companies and has been one of the largest grounds on which previous cases have been taken. The Minister of State may say that they were different agreements but it is the same language. Nonetheless, even within this piece, it is explicitly clear that there is vulnerability.

The Minister of State has been asked about this repeatedly. What risk analysis has been done around that question of the induced investment? Has there been proper consideration given in relation to our vulnerability when it comes to the provision of fair and equitable treatment?

What this amendment will do, in terms of inducements, is ensure that the High Court will have full discretion to refuse leave for enforcement of an award made pursuant to an agreement where the applicant of such enforcement is in receipt of public grants, public investment moneys or public procurement contracts.

What we do not want is to give a firm a public procurement contract, investment or a grant and it then gets to use that as proof that we gave it a reasonable expectation that then allows it to sue the State. That is exactly what is allowed under the CETA text, but it should not be enforced by our High Court. That is the vulnerability circle that has been created, and it is deeply regrettable.

There are multiple examples of it. It was Veolia, I am almost certain, that got a contract in Argentina to provide water and when Argentina ended that public contract because the water was undrinkable, it was told that under the terms of the contract it did not have to be drinkable and a ICSID case was taken. Veolia said that it was simply required to provide water; not to ensure its drinkability. These are the kinds of cases and kinds of vulnerabilities that have been created.

Thomas Byrne (Meath East, Fianna Fail)
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In terms of inducements for investors into the country, one of the biggest inducements is the fact of a free trade agreement. One of the biggest reasons companies invest in this country is because we have free trade agreements and stability. Far from negatively affecting Ireland's competitive advantages, there are quite a number of advantages to ratifying CETA from the perspective of attracting FDI. Ratification of agreements that include investment dispute resolution provisions, reduces investment risk through access to neutral binding dispute resolution and lowers the legal and political risk while enhancing our foreign direct investment offering.

The Bill will enable the ratification of major trade and investment agreements, thereby opening access to new markets and encouraging cross-border investment flows into Ireland. Ratification of such agreements helps to align Ireland with global investment standards and brings Ireland in line with EU and international frameworks. It reinforces us as modern, rules-based investment destination. Overall, it improves Ireland's competitiveness for FDI through a clear and transparent process which is available to investors in the countries with which we compete for FDI. This can serve to make Ireland more attractive when competing for foreign direct investment. Where Ireland is the global or regional headquarters for companies that operate here, it can offer them an additional layer of confidence when managing their global operations and footprint.

The question about why we are exposing the State to a new financial risk is asked time and again. I reject that we are doing that. Irish domestic law also has many similar provisions that are in the CETA agreement. In fact, it is not just me saying that these cases might be remote, Ms Justice Dunne also said:

It is difficult to imagine a provision or measure of Irish law which would amount to a breach of CETA, giving rise to a claim which would not, of itself, give rise to a claim before the Irish courts, arising out of the same circumstances.

The Senator has spoken again and with a lot of repetition on this and I feel that at times I am obliged to repeat things that I said already. The Senator has spoken at length on fair and equitable treatment. It is important to stress that the standard of fair and equitable treatment that is drafted under the new investor court system is quite different from the old approach and the fair and equitable treatment provision under the old approach was opaque and based on customary international law, which I have said already, with no description of content. The agreement clearly lists the aspects of fair and equitable treatment. They are denial of justice, manifest arbitrariness, targeted discrimination and manifestly wrongful grounds such as gender, race or religious belief. The Irish State does not do that.

Alice-Mary Higgins (Independent)
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The Minister of State has literally not answered the question. First, in terms of that list, it also includes provision for other measures that can be attached. It is not a closed box in terms of fair and equitable treatment. Further things may be added.

The Minister of State has been repeatedly asked - and not just by me - to address the interpretation of fair and equitable treatment and the question of specific representations. He has not addressed that. Will he clarify what, if any, risk analysis has been taken in terms of that element of exposure? The Minister of State has been asked about it repeatedly and he has never spoken about this section. It is there in the text of Article 8.10, that if a party has made a representation to encourage investment and then that investment is subsequently frustrated by the party, it may be considered unfair and inequitable treatment.

Has the Minister of State considered that because any time he has been asked about it he has not given an answer?

Thomas Byrne (Meath East, Fianna Fail)
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I cannot put the matter any further. The Bill has been drafted to ensure compliance with the Constitution and the international obligations we would assume upon ratification of various international agreements. The inclusion of broad discretion as provided for in this amendment would not be in compliance with the obligations, and I am unable to agree to it.

Alice-Mary Higgins (Independent)
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I move amendment No. 24:

In page 4, between lines 19 and 20, to insert the following:

“(4) The High Court shall have full discretion to refuse leave for

enforcement of an award made pursuant to an international agreement

to which this section applies where such enforcement would run

contrary to an opinion of the International Court of Justice.”.

Amendment No. 24 is an important one but our time is constrained, so I will be very brief. Amendment No. 24 asks that the High Court would have discretion to refuse leave for enforcement of an award where such enforcement would run contrary to an opinion of the International Court of Justice. This is relevant in terms of the occupied territories Bill and the concern expressed relating to the financial impact on companies by taking action and having a full and proper Bill that addresses both goods and services. We are seeing the interests and concerns of companies being quoted very heavily as a rationale in the argument for the dilution of that Bill. This again goes back to it being hard to credit the suggestion that the chill effect would not come in.

If we had a measure such as the occupied territories Bill - which in its preamble states that it relates to ensuring compliance with the opinion of the International Court of Justice - and were a company to take a case to the arbitration body and it went ahead and said here is the company's award, as we know it would because it does not consider itself bound by national and European law or the International Court Justice, would that award be enforced in Ireland?

I suggest that it should not be. If an award is made in relation to a measure that was taken to ensure compliance with the International Court of Justice, then it should not be enforced here.It is so not credible that the Minister of State is suggesting there will be no impact whatsoever when we see the Government already wobbling on previous commitments on international law, when the international law is crystal clear. As he knows himself, the foreign affairs committee has been clear on that as well, simply because of the concerns of the interests of some companies. Would it not be even more of a constraint on the Government or any future Government when it came to doing what we and the public all know is the right thing, if those companies also had a very useful tool by which they could threaten legal action in the event of the frustration of their expectations?

Thomas Byrne (Meath East, Fianna Fail)
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I have to be honest, I had not considered the occupied territories Bill was relevant to CETA, but I can tell the Senator this - the rules of general international law are binding on all states. Our Constitution makes that clear as well. We bind ourselves to international law. It is absolutely inconceivable that a CETA tribunal would make an award that breaches general international law. Therefore, this is unnecessary. To put it mildly, and to be generous, some of the examples are getting more stark now in terms of what the CETA will be. I have not heard previously the terrible situation in Gaza being brought into the CETA debate. That is certainly a new moment in this debate.

Michael McDowell (Independent)
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I want to intervene to mention that while I was temporarily out of the Chamber the Minister of State took it upon himself to say I was dismissive of Mr. Justice Gerard Hogan. I am not dismissive of him at all. He is a good friend and a jurist whom I admire greatly. I am however dismissive of the suggestion that Ireland can unilaterally and without making a protocol or reservation of any kind in acceding to the CETA agreement reserve unto itself in safety the right to refuse to implement awards of the arbitral courts on the grounds that they conflict with the Irish constitutional order. I say that because if somebody came to the courts in Ireland and was confronted by a defence by the Irish Government that to implement the agreement would contravene the Irish constitutional order, the dissatisfied Canadian investor or whoever else it may be under some future agreement could ask the Irish court to ask the European Court of Justice to rule as to whether Ireland's refusal to implement the award was consistent with the law of the European Union, and on that matter I favour hugely the view taken by Mr. Justice Charleton rather than the view taken by the majority in the Supreme Court.

I want to make one final point. The Minister of State on the last occasion correctly said that one judge, to wit the Chief Justice, who was in the minority, had responded to some of Mr. Justice Charleton's points. He had, but in respect of many of them, he did not. He effectively dismissed – if I may use that phrase – the views of Mr. Justice Charleton in a laconic way. What I am saying is that if this matter ever comes before an Irish court, and if it ever gets to the Court of Justice of the European Union to rule on Ireland's refusal to implement the award of an arbitral court under the CETA agreement, or any other agreement, on constitutional grounds, which has become binding as a matter of European law, the European Court of Justice will have jurisdiction to determine that issue if it is asked by an unhappy investor. As I said on the last occasion, I would put my life savings on the proposition that they would say that Ireland cannot do that. I say that because the Vienna Convention and the Washington Convention – all of these things – make it quite clear that where a treaty or international agreement is adhered to by a member state, if you want an opt-out in terms of your domestic law, that has to be signalled to everybody so that everybody else who is party to the agreement knows that it is the situation.

I want also to make the point that the Attorney General, when confronted with the interaction of CETA with the 2010 Act said the following in his submission to the court. He said nothing prevents the Oireachtas from amending or even repealing the 2010 Act if it wished. The interaction of CETA with the 2010 Act cannot credibly be suggested to constitutionally diminish sovereignty. That was the position of the Attorney General in the court when he made a submission. The court took a different view. Now we have the Attorney General effectively advising – if the Minister of State's description of his advice is correct – that this makes everything constitutional - that we are amending the Arbitration Act to accommodate this. All I am saying is we may think that in relation to domestic enforcement but in the end the European Court of Justice will have the final say. I cannot believe that it would uphold a unilateral provision which, in the words of the Attorney General, can be amended or repealed at the wish of the Oireachtas – that that changes Ireland's obligations under the statute.

I will conclude by saying this: we should not ratify CETA. Other states are not ratifying CETA. We should not do so for one very solid reason: every Canadian investor should have total confidence in the Irish legal order to uphold his or her rights in Ireland. That may not be true in terms of confidence in all of the member states in the European Union, but it is true about Ireland. We have a comparative advantage in that our legal system is totally trusted by outside investors. The experience since the provisional entry into force of CETA has shown that the issue of whether Ireland should or should not be bound by the arbitral courts has in no way inhibited Canadian-Irish trade or investment.

My last point is an ideological one. We are elevating international capital to an equivalent position on the plinth of international law with a private investor's interests on the one hand, and with a state's capacity to govern its own jurisdiction in a democratic manner on the other hand. International capital has no such rights. It does not have those rights. It should not be accorded those rights. In the last analysis, every member state of the European Union and every member of the United Nations must do its utmost to preserve its own capacity to fend off challenges or threatened challenges from international capital when it conflicts with the sovereign independence of the institutions of that state. I will finish by saying that CETA is unnecessary insofar as it is not yet in operation.The arbitral system envisaged by CETA is unnecessary and it is a precedent that the Department of Foreign Affairs and Trade should in future avoid. The Department should say Ireland does not need and is not signing up to these types of provisions, which are in effect elevating international capital to coequal status with sovereign states. That is not in the Irish interest or the people’s interest and ultimately it is not consistent with the spirit of our Constitution.

Thomas Byrne (Meath East, Fianna Fail)
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On those points, we go back time and again to the quotation from Ms Justice Dunne, namely that it is inconceivable that there would be a case under CETA that would not also be a case under Irish law. That is the practical reality. The cases that might arise uniquely because of the circumstances that Senator McDowell has outlined are highly unlikely because of the way we operate our system. He favours the judgment of Mr. Justice Charleton. It is not possible for the Government to say it prefers to dissent in a case. We have to look at what the law of the land is. The Supreme Court established that ratifying the CETA agreement would be unconstitutional and stated this legislation was potentially a way to make its ratification constitutional. We have taken that option, as suggested by the Supreme Court, because it is strongly our policy view that we wish to ratify this agreement. If any state party does not ratify the agreement, the whole thing collapses. That is established. Our view is that this Bill has been drafted to ensure compliance with both the Constitution and the international obligations, including EU law, which Ireland assumes.

Alice-Mary Higgins (Independent)
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I move amendment No. 25:

In page 4, between lines 19 and 20, to insert the following: "(4) The High Court shall have full discretion to refuse leave for enforcement of an award made pursuant to an international agreement to which this section applies where such enforcement would not be in the public interest.".

Maria Byrne (Fine Gael)
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Amendment Nos. 27 to 29, inclusive, are related. Amendments Nos. 28 and 29 are physical alternatives to amendment No. 27, and amendment No. 29 is a physical alternative to amendment No. 28. Amendments Nos. 27 to 29, inclusive, may be discussed together, by agreement. Is that agreed? Agreed.

Patricia Stephenson (Social Democrats)
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I move amendment No. 27:

In page 4, to delete lines 24 to 31.

The Minister for Foreign Affairs and Trade, after consultation, may by order prescribe an international agreement as an agreement to which the section applies. I do not agree with the idea that this Bill can, just by an order of the Minister, be made applicable to any agreement in the future. The concern is that this is the last opportunity colleagues will have to provide any scrutiny or analysis. This is particularly the case for the Seanad because it literally will not have another opportunity if trade agreements are only to be ratified by the Dáil. The idea that an arbitration order can be applied to any future agreement is seriously concerning and that is why I seek to remove the relevant lines.

Alice-Mary Higgins (Independent)
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Amendment No. 27 relates to the fact that we do not know what is coming. There is the old-time phrase “a pig in a poke”, and that is what it is. We are left wide open to future agreements or arbitration mechanisms any kind. As was said, the Dáil may be a technical imprimatur in relation to this, but the Seanad, which has shown great interest in these areas, will not. Agreements will not be subject to the kind of pre-legislative scrutiny that the Government sought to have waived on CETA. They will not be subject to proper and appropriate scrutiny, even though their detail is significant and requires significant decision-making.

Again, we do not know what we sign up to. Much as we do not know, the Minister of State, despite his great statements of confidence about things being inconceivable, does not know what forms of rulings may be made in relation to the arbitration tribunal. In this regard, we can look only to the facts of previous patterns of behaviour. This is the fundamental point that Senator McDowell made. This is a choice to create a special court system that is only available to corporations. It is not available to citizens concerned about the financial impact of laws or how they are unfair or inequitable.

There is a reason these mechanisms were originally introduced and imposed on African countries largely through economic partnership agreements and other provisions. There was an argument that their legal systems would not be adequate or appropriate. There has been a notable pushback from many of the countries that originally had this kind of extra court, a court outside the norms of the legal order they operated in, imposed upon them. South Africa became a champion in this regard when an Italian company tried to look for compensation for the ending of apartheid laws because it frustrated its reasonable expectations. Many other countries have taken that position. It is not that the direction of travel is the new courts; the direction of travel has been to remove them from treaties. Mercosur does not have one nor is there one in the Brexit deal. They are not being included in trade deals anymore because they are a parasitic element on trade agreements, which rightly should be between sovereign regions and states and those that are mandated by a public. The gratuitous giving of power to corporations was recommended as an opportunistic element in respect of CETA but it has been absent in many current agreements.

The Minister referred to regulatory impact. The risk analysis we seek in amendment No. 28 is to have clarification on the exact calculations in multiple areas, besides the hope and dream that the Minister of State has put forward.

Amendment No. 29 tries to limit the scope to agreements with states that are party to the Paris Agreement. The Minister of State has talked a lot about the climate, but let us be clear. Can deals be made with countries that are entirely outside the Paris Agreement? It is possible under this legislation. That is just a reminder that we do not know what parties these deals will be made with. We do not know the terms of the future deals. However, what we and experts can accurately predict are the likely outcomes of the ICS and other investor-state mechanisms attached to the EU-Chile and CETA agreements.

The fundamental question is exactly as Senator McDowell put it: why create a separate legal system if we have confidence in our legal system and in its ability to balance the public interest in the widest sense and the full sphere of the law, be that international law, European law or our own national law? It is only an opportunistic grab by corporate power, which has a historical record in this regard, and it has been resoundingly rejected by almost every country that has had the misfortune to have been subject to these kinds of investor dispute mechanisms. Ireland has not been exposed to this to the same degree as others. The Government is seeking to create such exposure and choosing to push the idea of a ratification vote and a dynamic that will become extremely difficult for future generations and Governments to undo. The Government is binding the hands of those in the future with this.

Again, I hope the Minister of State will indicate that he is going to accept amendment No. 29. Will there be deals with countries that are not party to the Paris Agreement? Where is the risk analysis?If the Minister of State is doing is doing what the court said, which relates just to CETA, why is he widening it to every other kind of agreement?

Maria Byrne (Fine Gael)
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I welcome to the Gallery guests of the Minister, Deputy Chambers, Senator Noonan and the Minister of State, Deputy Harkin. I hope they enjoy their visit to Leinster House.

As it is now 2.30 p.m., I am required to put the following question in accordance with the order of the Seanad of this day: "That amendment No. 27 is hereby negatived in Committee; section 4 is hereby agreed to in Committee; in respect of each of the sections undisposed of, the section is hereby agreed to in Committee; and the Title is hereby agreed to in Committee". Is that agreed?

Patricia Stephenson (Social Democrats)
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It is not agreed.

Mark Daly (Fianna Fail)
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When is it proposed to take Report Stage?

Maria Byrne (Fine Gael)
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Next Tuesday.

Mark Daly (Fianna Fail)
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Is that agreed? Agreed.

Fiona O'Loughlin (Fianna Fail)
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I propose a suspension of 20 minutes before we start the next item of business.

Mark Daly (Fianna Fail)
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Is that agreed? Agreed.