Why the EU and Canada's CETA deal is not just another treaty

There are a number of reasons for Ireland to be cautious about this trade agreement, writes Dr Oisin Suttle, Department of Law

There is an unavoidable tension between international law and national democracy. If the Oireachtas or the people by referendum choose a course of action, but international law says no, then something has got to give.
This does not mean that all international law is undemocratic. Whatever democracy means, it must be compatible with rules allowing states to coexist and cooperate on important matters, to solve shared problems like climate change, and protect important values like human rights. The freedom of a democratic state can only be freedom within the constraints of a reasonable international law. However, this tension means that we must closely examine any particular treaty to see if it strikes the right balance.
The Oireachtas and the courts will shortly be asked to decide whether the state can, and should, ratify the EU-Canada Comprehensive Economic and Trade Agreement (CETA). The fact that this treaty will limit the choices of the state's democratic institutions is not, in itself, an objection to it. This is what international law does.

However there are at least two important reasons to be especially cautious about this treaty. First, the treaty is for all practical purposes irreversible from Ireland’s point of view. Most international treaties provide an exit mechanism, allowing a state to give notice to the other parties and withdraw, giving up the benefits of membership but also freeing itself from the constraints the treaty imposes.

Article 58 of the European Convention on Human Rights allows states to leave following a six month notice period. Few need reminding of Article 50 of the Treaty on European Union, which allows member states to leave the EU on two years’ notice. It might not be possible for states, having ratified its charter, to withdraw from the United Nations, but irreversibility is very much the exception for international treaties. It is probably justifiable for fundamental obligations like the UN charter, but less so for more workaday matters.

At first glance, CETA seems to be terminable by notice. Article 30.9 allows a party to give 180 days’ notice of termination. While Ireland will be a party to this treaty, it is not the party who can terminate it. Only Canada, or the EU as a whole, can give the notice under Article 30.9. It is Ireland’s choice to be bound by the treaty but once bound, it will take the EU and its member states, acting together, to terminate it.

The only way Ireland acting alone can exit this treaty is by leaving the European Union. Even if the treaty were terminated, whether by the EU or Canada, or by Ireland leaving the EU, obligations in relation to investors and the Investment Court System would remain in place for a further 20 years. The full terms of at least four Dáils would pass between giving notice to terminate and being free from the restrictions the treaty imposes.
Second, the investment protection system that CETA establishes is a back door around the Oireachtas’s normal legislative role. Ireland adopts a 'dualist’ approach to international law. This means that international agreements only have effect in Irish law once they have been made part of that law through an act of the Oireachtas. Ireland joined the European Convention on Human Rights in 1953, but citizens could not rely on the convention in Irish courts until a 2003 act of the Oireachtas gave it domestic legal effect.
The government has broad freedom to make treaties on behalf of the state and only requires ratification in the Dàil where those treaties impose a charge on public funds. The Oireachtas’s exclusive power of making laws is protected by the rule that those treaties only have effects within our legal system once they are transposed through legislation.

On the face of it, CETA respects that distinction. Article 30.6.1 provides that the agreement cannot be "directly invoked in the domestic legal systems of the Parties". However the Investor Court System provides a parallel court system, exclusively for investors. This allows individual companies to directly enforce the investment provisions of CETA against the Irish state, challenging Irish legislation and Irish administrative and judicial actions, and potentially obtaining huge sums in compensation.
The judgments of the Investor Court System will be directly enforceable in Irish (and most other countries’) law. Under the ICSID Convention and the Arbitration Act 2010, those judgments will have the same effect in Ireland as a judgment of an Irish court, while Irish courts will be prohibited from reviewing them in any way.
Every treaty requires a balancing act, between imposing restrictions on state action, and retaining space for meaningful democratic choice. CETA’s irreversibility and effective short-circuiting of the Oireachtas’ legislative power mean that it tilts that balance strongly against democracy.

(Front photo credit: Rene Baker on Unsplash)