Renegotiating the Korea-U.S. Free Trade Agreement is impossible and the investor-state dispute or ISD settlement clause is a long-standing international practice, Trade Minister Kim Jong-hoon said Monday, rejecting the opposition parties’ call for the clause to be removed from the accord.
Speaking on a local radio station, Kim said Korea has been including ISD settlement clauses in agreements with other nations since 1976 and that the clause has not proved damaging to Korea since.
The “ISD clause has been included since the country formed its first investment promotion and protection agreement in 1976 with the U.K., and was included in the investment promotion and protection agreements signed with 81 countries since,” Kim said. He added that among the many international mediation processes, the International Center for Settlement of Investment Disputes treaty, which was formed in 1966, is the most commonly invoked, and 147 nations are currently using the process.
“It has been 45 years since we (Korea) joined the treaty but we have not once sued nor had suits brought against us.”
He added that a large number of cases brought to the International Center for Settlement of Investment Disputes involve U.S. investors and that in the majority of cases the investor has lost.
The ISD settlement clause allows investor-state disputes to be settled under the mediation of a third-party.
The opposition parties have honed in on the ISD clause saying that the system could interfere with Korean government policies, as disputed issues are viewed only in terms of investor protection under the system.
While the Democratic Party-led coalition of opposition parties at first selected 10 items they considered to favor the U.S. in the plans for the so called “re-renegotiations,” Rep. Chung Dong-young of the Democratic Party has recently stated that the party will “actively consider” the Korea-U.S. FTA if the ISD clause is removed.
By Choi He-suk (email@example.com