Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [HL]

Lord Davies of Brixton Excerpts

Report stage
Tuesday 16th January 2024 Lords Chamber

[Lord Davies of Brixton (Lab)]

My Lords, I support all the amendments in this group. I happily added my name to Amendment 11, but I will focus on my Amendment 9. The common theme through these amendments is of raising concerns about possible issues arising from a trade agreement. We are all free- traders now, but there is a recognition that free trade should be respectful of the limits that we and other countries set to protect labour standards, the environment, food quality and so on. There is a balance to be achieved and this series of amendments raises issues of concern.

These amendments are all limited, because the Bill is limited. It is not the treaty, but just the administrative arrangements required to implement it, so it could not achieve a lot anyway. We are asking the Government to review these issues. I hope that they are of sufficient importance that they would be studied, in any event. It is possible that we do not need these amendments, as a good Government would review these issues, but they provide us with the opportunity to point out areas of concern.

My Amendment 9 concerns investor-state dispute settlement mechanisms. The investment chapter of the CPTPP contains these arrangements and allows companies to sue Governments over decisions to implement policies that impact their corporate profits, even when these decisions were made in the public interest. We debated this in Committee, and I am sorry to say that I found the Minister’s reply to our concerns less than reassuring. Referring to these arrangements, he said that that they do not

“derogate or hinder our right to regulate in the public interest, including in areas such as the environment and labour standards”.

Referring explicitly to the CPTPP, he also said that it

“preserves states’ rights to regulate proportionately, fairly and in the public interest”.—[Official Report, 14/12/23; col. GC 375.]

That sounds fine.

The International Bar Association has a similar view, stating that,

“while investment treaties limit states’ ability to inflict arbitrary or discriminatory treatment, they do not limit (and, in fact, expressly safeguard) a state’s sovereign right to regulate in the public interest in a fair, reasonable, and non-discriminatory manner”.

The problem is that these phrases, “arbitrary or discriminatory treatment” and a

“fair, reasonable, and non-discriminatory manner”,

are doing a lot of heavy lifting. They are all subject to interpretation. There have been real concerns that, in practice, commercial interests will be elevated above those of the public. There is so much there that needs to be taken on trust. The key point is that this clearly—and, I suggest, inarguably—is an issue that needs to be kept under close review, which my amendment does.

The problem we face is that ISDS arrangements have been used to challenge health provision, labour rights and other important regulations. This is not a theoretical possibility; there have been enough examples in practice to give rise to this concern. I quoted the CBI in Committee and it is worth expressing its views again—that there is

“a risk of the UK becoming disproportionately targeted through ISDS”,

and that

“there could also be environmental implications of the UK being exposed to the ISDS mechanism”.

These are not fringe concerns but concerns of different interest groups.

In simple terms, the ISDS arrangements make it possible for firms to sue Governments for measures that harm their profits. The existence of this power has a chilling effect on regulations, particularly those designed to combat climate change.

A specific example, of which we need some account, is the attitude to the energy charter treaty, under which many cases have been brought by western companies taking action against Governments to limit their use and expansion of fossil fuels. So problematic has this become that large European countries have signalled their intention to exit from this treaty. The Government themselves have said that they are reviewing their energy charter treaty membership and

“will carefully consider the views of stakeholders”.—[Official Report, Commons, 4/9/23; col. 4WS.]

Given the dawning realisation that these sorts of clauses are an impediment to climate action and to sovereign policy-making in general, it seems wrong for us to sign up to further restrictions through this treaty. I am amazed by the modesty of the demand that this aspect of the CPTPP should be subject to a formal review so that we can see what impact it is having on government corporate relations.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am delighted to speak to Amendment 10 in my name, which is in similar terms to the amendment I tabled in Committee and requests

“an assessment of the impact of the implementation of the CPTPP Chapter on government procurement on environmental protection and animal welfare, health and hygiene”.

I am grateful to my noble friend for trying to seek me out. I missed him yesterday and he missed me today. Along with the noble Lord, Lord Alton, and a number of others, we were paying tribute at the memorial to an outstanding parliamentarian, Baroness Boothroyd. I am sorry that I missed my noble friend’s attempt to speak to me, but I am grateful for the opportunity to speak to him in the confines of these deliberations.

What has changed very clearly since Committee stage is that an announcement was made by the Environment Secretary at the Oxford Farming Conference that the Government are committing to consult on new food labelling—plans that will ensure that British produce will, as he put it,

“stand out from the crowd”.

The idea is to allow changes to food labelling entitling consumers to make better decisions at the supermarket in particular, while also highlighting high-quality British produce to the public. I quote from the press release issued by the NFU, which quotes what my right honourable friend Steve Barclay said:

“New food labelling would also make it clearer when imported products do not meet the same UK welfare standards”.


I put it to my noble friend: would it not be better if we did not import food that does not meet the high UK animal welfare and environmental standards that consumers demand and our domestic producers are honoured and delighted to meet? What is the relationship between this new labelling scheme and the Red Tractor scheme, which already demonstrates compliance with all the food requirements by domestic producers?

Is it not a fact, and does my noble friend not agree, that domestic producers meet the highest standards of animal welfare and environmental protection in their production? This means they are meeting a higher standard and it is therefore more expensive to produce. This is exactly what happened in the 1990s with the decision to unilaterally ban sow stalls and tethers in the production of pigmeat while we continued to import pork produced by sow stalls and tethers for an interim period of seven years. This meant the consumer swapped high-end, high-quality, high-animal-welfare-standard UK pig production with lower, cheaper, substandard imports. After seven years, this put our pig producers out of business.

I hope my noble friend will give me his assurance today that after six months—or 12 months in the terms of my Amendment 10—an assessment will be undertaken by his department, jointly with Defra, to ensure that the trade Bill before us this evening does not discriminate against UK domestic production, particularly of meat and dairy. In addition, can he give an assurance that the food labelling provisions that Defra is proposing to consult on, and which I support, will apply not just to supermarket labelling but will somehow translate on to the food menus for food sourced from third countries in our restaurants, bars and cafés in this country? That is the main purport lying behind Amendment 10.