Korean Prime Minister agreed to abolish ISDS

On 12 July 2019, the Prime Minister of South Korea, Mr. Lee Nak-Yon, attended the National Assembly and said that he agreed to abolish ISDS. (Media coverage: Yonhap, Hani, Khan) This remark came out while his responding to a lawmaker, Mr. Song, at the plenary session of the Budget and Accounting Committee.

The Prime Minister gave reasons for his consent: an excessively high cost; a poor predictability of outcome; and the problem of tyranny of a strong man. He added that the government, especially the Ministry of Justice, the Ministry of Industry, Trade and Energy, and the Ministry of Foreign Affairs were discussing how to reform ISDS, and would consult with the National Assembly when a government plan was developed.

As for the UNCITRAL working group, he said that the Korean government's solution would be prepared in consideration of the national interest and submitted in due time. Interestingly, both the Prime Minister and Mr. Song said the due date is the end of July, not July 15th (This is because the Korean government was granted from the UNCITRAL an extension on the July 15 deadline).

It is the first time that the senior government official officially mentions the repeal of ISDS. Back in 2012, Mr. Lee signed a letter of Korean politicians to the U.S. political leaders (including the President Obama), but at that time he belonged to the opposition party. 

The inquiry of the lawmaker Mr. Song and the response of the Prime Minister stems from the campaign of Korean civil society groups, especially the press conference of June 26th  at the National Assembly, and subsequent media coverage (here, here, here and here). When Mr. Song asked the Prime Minister about ISDS, he reiterated what the civil society groups explained at the press conference and subsequent op-ed. 

Mr. Song demanded, exactly as the CSOs did, the Korean government to present solutions which went beyond the US did in the re-negotiation of NAFTA and the new model BIT of the Netherlands. NAFTA 2.0, or USMCA, eliminates ISDS between the US and Canada and limits the application of ISDS between the US and Mexico. The Dutch new model BIT imposes an obligation upon foreign investor to comply with domestic laws and regulations of the host state, including laws and regulations on human rights, environmental protection and labor laws.

Letter between USG and SKG on confidentiality of KORUS renegotiation documents

January 5, 2018

Michael Beeman

Assistant United States Trade Representative

Office of the United States Trade Representative

Washington, D.C.

Dear Mr. Beeman:

This letter is to acknowledge receipt of your letter of this date, which reads as follows:

“In preparation for initiating negotiations on amendments and modifications to the United States-Korea Free Trade Agreement (KORUS), I would like to outline the following important points about the handling of documents in the context of the negotiations, and confirm that you agree with this approach: 

Letter b/w EC and SKG on confidentiality of negotiation documents of EU-Korea FTA

Facts and Figures of TRIPS-Plus: Experiences of South Korea

Joint Sign-on Letter of CSOs to Trade Ministers of RCEP Negotiating Countries

- Updated version with further signatories from 29 Sep. letter-

 6 October 2017

Dear Ministers of Trade & Negotiators from RCEP Negotiating Countries,

The 20th round of the Regional Comprehensive Economic Partnership (RCEP) negotiations is taking place from 17-28 October 2017 in Songdo, Korea. [1] RCEP negotiations include chapters on goods, services, investment, intellectual property etc and the proposed provisions in these chapters affect the daily lives of the peoples of all sixteen countries [2] involved in these negotiations including their access to knowledge and affordable life-saving medicines, farmers’ livelihoods, privacy, environmental protection and many other needed regulations.

KORUS Negotiation Documents (Preamble for Investors): Disclosed by the Supreme Court Order

Now we got a piece of negotiation documents of KORUS FTA. They reveal the US unilateralism, which will be pursued more strongly by the Trump Administration. Efforts of Korean negotiators to insert "Korea" into the KORUS Preamble were all failed. Compare the final text and failed proposals of South Korean Government (SKG).

Korean Supreme Court Opposing ISDS in KorUS FTA

When the KorUS FTA was negotiated from 2006, the Korean Supreme Court delivered its opinion against ISDS to the Korean government twice in 2006 and 2007. Ridiculously, the opinion of 2006 was disappeared for unknown reason. Here is the opinion of 2007. English translation was made by the Korea National Assembly in May 2012 upon request of the lawmaker Joosun Park (currently the Deputy-Speaker). Original Korean text is found here, and PDF file of the official English translation is here.