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What are we trading away?

CHOICE says a secret trade agreement could lead to higher prices and reduced consumer protections

24 October 2014

CHOICE is calling on the Government to reveal what Australia is trading away in the Trans-Pacific Partnership Agreement (TPP) trade discussions being held in secret in Sydney tomorrow.

“While big business has had a seat at the table, Australian consumers have been locked out of negotiations,” says CHOICE Campaigns Manager Erin Turner.

“Instead, we have to rely on leaked documents to learn what is being negotiated our behalf.

“Australia has an extremely open economy with few tariffs and trade barriers, and this raises the critical question - what are we offering up in these negotiations?” Ms Turner says.

CHOICE is renewing its calls on the Federal Government to release the text of the TPP to inform an open and transparent debate on its costs and benefits for Australians.

Based on the leaks, the consumer group says Australia has three things to fear in the TPP:
  • Higher medicine prices;
  • New criminal penalties; and
  • The right for big business to sue if they don’t like local consumer protection laws.[1]

Medicines

“Leaked copies of the TPP include provisions to lengthen patents for some life-saving drugs for up to 12 years,”[2] Ms Turner says.

“When drugs listed on the Pharmaceutical Benefit Scheme come off patent, prices drop by 16 percent.[3] If the TPP extends patents we’ll be paying higher prices for some medicines over a longer period of time.

“This is even more concerning given our latest Consumer Pulse survey results which found 63 per cent of Australians are concerned about the cost of medicines. Concern increased to 66 per cent for people who earn $50,000 per annum or less and 67 per cent among parents.

“Clearly, people are already worried about cost of medicine and the Federal Government needs to be extremely cautious about any agreement that would put the interests of pharmaceutical companies ahead of consumers.”

New criminal penalties

“The TPP leaked chapter contains extremely harsh penalties for online copyright infringement that go far beyond what current Australian law requires,” Ms Turner says.

“Downloading a single song, for instance, could lead to serious criminal penalties.”[4]

Rights for big business to sue

“CHOICE doesn’t believe that a foreign business should have the right to overturn decisions made by the Australian Government, or the Australian High Court,” Ms Turner says.

“However, the likely inclusion of ’investor-state dispute settlement’ mechanisms in the TPP will have this effect.

“It will make it harder for the Australian government to pass new legislation, including consumer protection laws, in the future.

“We understand trade negotiations are sensitive matters. However, when an agreement has the potential to increase cost of living pressures on Australians, it becomes a matter of public interest and should be released for public debate,” Ms Turner says.

The CHOICE Consumer Pulse survey was designed and analysed by CHOICE with fieldwork by GMI/Lightspeed Research conducted with 1012 consumers aged 18-75 years between 18 and 24 September 2014. Final data has been weighted to ensure it is representative of the Australian population based on the ABS Census 2011.

[1] TPP IP Chapter, dated 16 May 2014  available via  https://wikileaks.org/tpp-ip2/

[2] See Article QQ.E.20, ibid. Also note the words "...an extra..." have been removed from this quotation.

[3] Harris, T., Nicol, D., Gruen, N. 2013, pxviii Pharmaceutical Patents Review Report, Canberra, available at http://www.ipaustralia.gov.au/pdfs/2013-05-27_PPR_Final_Report.pdf

[4] See article QQ.H.7 of the leaked IP Chapter of the TPP, dated 16 May 2014  available via  https://wikileaks.org/tpp-ip2/

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