ISDS and COVID

'Compulsory licences and ISDS in Covid-19 times: relevance of the new Indian investment treaty practice' by Prabhash Ranjan in (2021) 16(7) Journal of Intellectual Property Law & Practice 748–759 comments 

As the world grapples with the Coronavirus disease (Covid-19)—the worst pandemic in the last 100 years—war-like efforts are being made to find a vaccine or a cure for the disease.  Indeed, a few newly developed Covid-19 vaccines have already been approved for public use.  At the same time, given the concerns of vaccine nationalism—countries pushing to get first access to Covid-19 vaccines —many are filled with consternation about the timely and equitable access to medicines and vaccines. This concern has been outlined by countries like India and South Africa who in their recent proposal to the World Trade Organization (WTO) state: ‘As new diagnostics, therapeutics and vaccines for COVID-19 are developed, there are significant concerns, how these will be made available promptly, in sufficient quantities and at an affordable price to meet global demand.’ 

To ensure timely and equitable access to Covid-19 vaccines, drugs, and diagnostics, India and South Africa have proposed that, following Articles IX.3 and IX.4 of the Marrakesh Agreement establishing the WTO, certain provisions of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement6 be temporarily waived or suspended to allow the prevention, containment, or treatment of Covid-19. Such a temporary suspension of the application of the TRIPS Agreement would give complete regulatory freedom to countries to deal with the production and distribution of Covid-19 vaccines, drugs, diagnostics without being concerned about the enforcement and protection of intellectual property rights. This radical proposal stems from the assumption that intellectual property rights such as patents, in certain circumstances, could act as barriers to accessibility of drugs and medicines. Several least developed and developing countries have endorsed the proposal at the WTO, while developed nations are not in favour. 

Nonetheless, there is a consensus that countries need to collaborate to ensure timely and equitable distribution of drugs, vaccines and diagnostics for the treatment of Covid-19. To accomplish this objective various regulatory tools can be used in a manner that is consistent with the existing international law on intellectual property rights.  This is especially relevant because several patent applications have already been filed for Covid-19 vaccines. 

An important regulatory tool in this regard is a compulsory licence (CL)—the granting of a licence by a government to a third party to use the patent without the consent of the patent holder after paying a government-determined royalty to the patent owner.  The possibility of issuing a CL is significant flexibility in the patent regime, especially in the context of pharmaceutical patents, because it allows governments to address public health needs by ensuring the availability of patented medicines at low-cost prices to those who cannot afford them. 

Some countries have taken steps in this direction by adopting laws to expedite the issuance of CLs.14 Canada enacted a Covid-19 Emergency Response Act,  through which it amended the Patent Act to accelerate the process of issuing CLs for public health purpose.  Likewise, Chile adopted a resolution pronouncing that the Covid pandemic is a strong ground to validate the issuance of CL on Covid-19 related technologies.  Ecuador has also adopted a resolution requiring the national government to establish compulsory licences and adopt other measures to ensure free and inexpensive access to medicines and other medical technologies to combat the Covid-19 pandemic.  Germany, Europe's largest economy, has also passed legislation, the Prevention and Control of Infectious Diseases in Humans Act, which empowers the health ministry to issue government use authorization under the patent law, after the declaration of a national epidemic by Bundestag, German federal legislature’s lower chamber. Israel has already issued a CL for the importation of Kaletra (lopinavir 200 mg/ritonavir 50 mg) for the treatment of Covid-19 patients. 

In India too, several commentators have identified the prominence of CL for realizing public health objectives.  Already demands have been made for the issuance of CL on drugs like remdesivir to augment its accessibility for Covid-19 patients.  The potential use of CL as a regulatory tool in Corona times might go up further as Covid-19 vaccines become available. India, which is often called the pharmacy of the world, might have an important role to play in ensuring supplies of vaccines and drugs to various countries such as in Latin America. 

Given this background of the rising importance of CL, from the perspective of states, it is imperative to understand what kind of legal challenges they can face if they make use of this regulatory tool. This question becomes even more important because patent owners, when it comes to drugs and medicines, in a large number of cases, are pharmaceutical companies who zealously protect their intellectual property. 

One obvious option for these companies will be to challenge the issuance of such CLs under the domestic laws of the country concerned. Another choice that many foreign pharmaceutical companies might like to employ, under international law, is to challenge the issuance of such CLs before investor-State dispute settlement (ISDS) tribunals. These ISDS tribunals derive their authority from bilateral investment treaties (BITs)  or investment chapters of free trade agreements (FTAs). These BITs or investment chapters in FTAs allow foreign investors to directly bring claims against host States for alleged treaty breaches before ISDS tribunals—a three-member ad hoc arbitration tribunal—often without exhausting local remedies.  Intellectual property rights (IPRs) in these treaties are listed as investments.  Consequently, ISDS tribunals have jurisdiction over regulatory measures that impair the investor’s IPRs. This allows pharmaceutical companies to enforce their IPRs through the ISDS mechanism. 

Indeed, in the last few years, foreign investors have employed the ISDS regime to challenge the host State’s regulatory measures relating to IPRs.  For example, Eli Lily, an American pharmaceutical company challenged the invalidation of its patent by a Canadian federal court on the ground of ‘inutility’.  Philip Morris, a tobacco company, challenged Australia’s legislation mandating plain packaging of tobacco products under the Hong Kong–Australia BIT.  Philip Morris also brought a similar claim against Uruguay under the Switzerland–Uruguay BIT. Accordingly, the possibility of pharmaceutical companies challenging the issuance of CL before ISDS tribunals is real, not conjectural. 

International investment lawyers have pointed out that foreign investors can challenge the issuance of CL before an ISDS tribunal on the ground that it amounts to an indirect expropriation of their investments. In other words, foreign investors can argue that the issuance of a CL has led to substantial deprivation of their investment, thus constituting indirect expropriation under international investment law. As Bryan Mercurio argues, the prospect of challenging the issuance of CLs as expropriation before an ISDS tribunal is an attractive proposition for a patent holder for several reasons.  First, it allows the patent holder to directly bring about a claim before an international tribunal bypassing the domestic courts of the host country. Secondly, if the claim were successful, it would provide higher compensation to the patent holder than what the host State would pay to her as remuneration for issuing the CL (see also Section II.2). 

Whether the foreign investor will succeed in such a claim will depend on various factors, such as the duration for which the CL has been issued, whether the royalty paid to the patent owner is satisfactory, what impact the issuance of the CL had on the patent owner’s overall investment in the host State, what is the language of the treaty provision on expropriation in the BIT, whether the treaty permits deviation from the substantive treaty provisions like expropriation for public health purposes etc.36 Nonetheless, since IPRs are recognized as investments in BITs, the critical point is that foreign investors can bring such claims before ISDS tribunals. Thus, ISDS tribunals will enjoy jurisdiction to decide whether the issuance of a CL amounts to indirect expropriation or not. Foreign investors can also contest the issuance of a CL as a violation of the fair and equitable (FET) provision—a ubiquitous clause present in all BITs or other substantive provisions like national treatment. 

The purpose of this article is to closely examine India’s investment treaty practice  to see whether it provides a safe haven for the issuance of CLs from foreign investor's claims for treaty breaches before an ISDS tribunal. In case a BIT or an investment chapter of an FTA exempts the issuance of CLs from the ambit of the substantive treaty standards, it would imply that the host State has greater regulatory autonomy to make use of CLs in the current times without worrying about ISDS claims. A survey of Indian BITs and FTA investment chapters shows that in the bulk of these treaties there is no specific mention of excusing the issuance of CLs from the application of the treaty's substantive standards. In other words, if a foreign investor contests the issuance of a CL as a breach of any of the substantive provisions of the BIT, the outcome of such a challenge will depend on the numerous factors mentioned before. 

However, there are some Indian BITs and FTA investment chapters that exempt the issuance of CLs from the application of the substantive treaty standards. In this article, we study such investment treaties by dividing the discussion into two parts. First, the article, in Section II, discusses those Indian BITs and FTA investment chapters where issuance of CL is outside the ambit of the expropriation provision. Next, the article, in Section III, focuses on the new Indian investment treaty practice, starting from the 2016 Indian model BIT,  which provides that issuance of CL is outside the scope of the entire BIT. Section IV concludes by arguing that India's recent treaty practice provides greater regulatory bandwidth to States in Covid-19 times to pursue public health objectives should countries wish to use CLs as the regulatory tool to increase accessibility of Covid vaccines and drugs. Thus, India’s new investment treaty practice holds some lessons for other countries to deal with ISDS claims challenging the issuance of CLs. However, before discussing the treaty practice, Section I provides an overview of the Indian patent law on the issuance of CLs.

Justice Data

‘Justice system data’: a comparative study (A report examining how Canada, Australia and Ireland manage the data and information that is generated by their justice systems) by Judith Townend and Cassandra Wiener for The Legal Education Foundation (TLEF) analyses 

the ways in which ‘justice system data’ – that is the information generated by the process of justice – is managed in three countries: Australia, Canada and Ireland. It considers how data-sharing methods are perceived to relate to judicial independence, innovation, and public understanding and confidence in the justice system. ... the report builds on previous TLEF work on justice data in England and Wales, and aims to inform UK-based policy making as well as knowledge exchange in international legal and technology networks. 

The research

identified that:

• There is a common understanding and definition of ‘justice system’ data types and access in the three case studies of Australia, Canada and Ireland, though in all contexts justice data management has evolved messily over time (with emergency measures during the COVID-19 period) rather than as the result of purposive design. 

• Improved access to justice data is perceived by legal, academic and NGO stakeholders to help deliver access to justice, and protect important principles of open justice, judicial independence and public understanding of the law, and is part of these countries’ work to meet access to justice policy objectives, including UN Sustainable Development Goal 16. 

• In opening up justice data, challenges and tensions across the jurisdictions were also exposed: the impact of legacy practices; the under-investment and decentralised approach to technological reform; a data deficit for user and case experience; a tension between privacy and transparency in the provision of court records containing personal data; and a lack of accountability measures for the management of justice system data. 

• There is limited robust empirical data with which to measure the impact of justice sharing and access methods against desirable outcomes for a justice system.

In light of the findings, we argue that there is a need for:

• Clearly presented policies, shared publicly, on the differing roles for executive, court service, judiciary and any third-party providers in the management of justice system data. 

• Accountability mechanisms for access to justice data: i.e. appropriate routes of application and appeal for accessing justice data that is not readily available in the public domain. 

• Consideration of public and court user views and experiences in the design of justice system data processes (especially with regard to the use of personal data). 

• Detailed measurement of the impact of data sharing practices on outcomes of the justice system.

The authors comment 

 Contemporary justice systems are complex and messy as a result of anachronistic structures and rules that have evolved since the medieval period; they have not been neatly designed to fulfil specific purposes and protect individual or collective interests (even if these purposes and interests are now cemented and protected in national and international law). Inevitably, this means ‘justice system data’ – that is the information generated by the process of justice – is equally complex and messy, with a hybrid of policies and laws governing its collection, storage and dissemination. The transition from analogue and paper-based systems to digital technological methods, with some aspects fast-tracked during the COVID-19 pandemic period, has only further complicated the picture. Despite the importance of reliable data for the purposes of understanding law and legal process, for the development of evidence-based justice policy, and for meeting the objectives of fair and open justice, the theory and practice of justice system data management are rarely the primary focus of academic and policy attention, and often incidental to a broader discussion about an aspect of law. There are, of course, notable exceptions. A previous report on digital justice in England and Wales by The Legal Education Foundation (TLEF) identified data needs within the English justice system and urged the creation of a robust strategy for data collection, analysis and sharing, with 29 specific recommendations, which HM Courts and Tribunals Service (HMCTS) responded to in October 2020. More recently, the Civil Justice Council/TLEF review of the use of remote civil courts during the COVID-19 pandemic highlighted the data gaps on civil justice, and re-iterated the need for the expansion of data collection, and investment in robust data systems. 

In order to further explore this area, we were commissioned by TLEF as part of its ‘Smarter Justice’ programme, which includes developing a Justice Lab UK, to undertake a short-term comparative study considering the ways in which justice system data is managed in different countries, focussing on English-speaking common law jurisdictions. The overall objectives of this study were to consider how current approaches and past experiences can inform the development of justice data systems in other contexts. The research took place from May–August 2020, conducted remotely during the COVID-19 restricted period. 

We contend that while part of a broader agenda on open data and access to administrative data, justice system data deserves its own particular and special treatment, owing to the particular constitutional principles underpinning its generation and use, such as a separation of powers between judiciary and executive. 

Within the scope of this project we cannot promise a complete overview of each of the chosen countries; as we peeled back the layers of the chosen jurisdiction, we discovered further layers of complexity and idiosyncrasy, as we attempted to understand the handling of justice system data within the federal or national level courts, the state or province level courts, and within these, between different court types and jurisdictions (civil, criminal, family, tribunal). Even within a court ‘type’ in a single regional jurisdiction, there may be differences in practice and policy. We have, however, attempted to set out a more thorough comparative review than currently exists in the academic and policy literature. Our review focuses on Australia, Canada and Ireland, with some reference to other global and national initiatives. Our goal is to inform policy development in England and Wales and beyond but as one of our interviewees advised, we do not attempt to set universal recommendations or standards at this point. Instead we focus on evidencing and explaining the principles and practice of existing systems and drawing conclusions on what has and has not worked in the regions we studied, highlighting good practice examples. We hope these conclusions can be drawn upon to inform future justice data governance in England and Wales, where some of the recommendations of ‘Digital Justice: HMCTS Data Strategy and Delivering Access to Justice’ (Byrom, 2019) are already being progressed, as well as to assist initiatives in other countries and at a global comparative level. 

1.2 The brief and our approach 

Our brief asked us to consider: 

1 How other countries define ‘justice system data’. What are the categories they use to describe the different types of data generated by the justice system? This includes information like case files, judgments, management information, tribunal decisions etc. 

2 What arrangements are in place for making this data available to different stakeholders (public/press/researchers/private sector) and how are they financed? To what extent have other countries delegated the function of data dissemination to the private sector? 

3 Where have other countries placed different types of data on the open/shared/closed spectrum? Are these arrangements time limited, e.g. closed until x date? 

4 What have been the benefits and drawbacks of the approaches developed in these countries? We are particularly interested in identifying robust research that is capable of demonstrating a link between the types of sharing practices adopted and: a. judicial independence b. public understanding of the law c. public confidence in the justice system d. innovation e. the attractiveness of the legal system as a forum for resolving disputes. 

In order to answer these questions, via literature review and remote interviews, we have structured our report as follows. Following this introduction, which includes a description of the methodology of the report, Chapter 2 gives more detailed context for the report, providing a definition of ‘justice system data’; details of global initiatives on improving justice data; the risks and safeguards for managing justice data; and an overview of justice system data in England and Wales. Chapters 3, 4 and 5 describe our main case studies, the justice systems in Australia, Canada and Ireland, considering the questions above for selected courts in each jurisdiction, and other relevant issues that emerged in the course of the research. Chapter 6 offers a comparative and critical analysis of all three case studies, with some reference to other jurisdictions, including England and Wales; and makes some general conclusions and recommendations of good practice for policymaking and practice in this area (while not attempting to draft universal standards). The Appendices offer a list of key resources and information about our interviewees. 

.

Speech

'Defamation Actions and Australian Politics' by Michael Douglas in (2021) 5 UNSW Law Journal Forum comments 

 In recent years, politicians have been frequent participants in Australian defamation litigation. Attorney-General Christian Porter’s recent claim against the Australian Broadcasting Corporation and journalist Louise Milligan is a notable example of the weaponisation of defamation in Australian politics. This article reviews prominent examples of where politicians have commenced or threatened defamation proceedings. The article also considers whether the trend of politicians litigating defamation is desirable, and how it will be affected by the amendment of the Uniform Defamation Acts once the Model Defamation Amendment Provisions 2020 are implemented. 

Douglas argues 

In recent years, politicians have been frequent participants in Australian defamation litigation. Attorney-General Christian Porter’s recent claim against the Australian Broadcasting Corporation (‘ABC’) and journalist Louise Milligan  is a notable example of the weaponisation of defamation in Australian politics. This brief article reviews prominent examples of where politicians have commenced or threatened defamation proceedings. The focus is on cases in which politicians are plaintiffs, although some cases mentioned below also involve politician defendants.  The article considers whether the trend of politicians litigating defamation is desirable, and how it will be affected by the amendment of the Uniform Defamation Acts once the Model Defamation Amendment Provisions 2020 are implemented. It begins by considering the value of politicians’ reputations, which defamation law may protect. 

 ‘Reputation’ is a multi-faceted concept at the heart of defamation law.  The value of a person’s is bound up with their honour and dignity, and their standing in society.  Australian defamation law protects the value of a person’s interest in their reputation by providing that publication of matter about a person that damages their reputation, is actionable.  If reputation is what society generally thinks of a person,  then every one of us who is part of the community has a reputation. Politicians are no different. Politicians’ reputations may be different to those of ‘regular people’ in some respects. First, a politician derives an income from their reputation in a way that many (but not all) individuals do not. While impact on a person’s employment may sound in special damages that would be unavailable to a person whose employment was not affected by defamation,  the High Court has confirmed that the general test for defamation applies to professional and non-professional reputations alike. 

Second, politicians’ reputations are bound up with their work in political institutions. We judge politicians by their ability to deliver on promises, their integrity, and how their expressed values align with their lived values.  Our system of representative government depends on politicians’ accountability to the public. Thus, some criticism of public officials is to be expected or even welcomed. Arguably, the public is less likely to take a derogatory comment about a politician to heart; people understand that politicians will be criticised no matter what.  However, insofar that Australian law protects freedom of speech in order to keep leaders accountable, its focus is on the subject matter rather than the person.  The freedom of political communication implied in the Commonwealth Constitution is narrowly confined to certain political speech. The so-called ‘Lange qualified privilege’  underpinned by that freedom is narrow in its operation,  as some of the cases below illustrate. 

Third, putting aside their financial incentives, politicians may have a stronger incentive to sue over defamation than other would-be plaintiffs. Perception is critical to a politician maintaining their standing in the system and grip on power. Several Australian politicians have resigned in the wake of allegations of impropriety.  Although truth provides the foundation of a justification defence for a person publishing an allegation of impropriety,  the mere threat of defamation litigation may be enough to sway some to believe that any allegations were unfounded. The mention of defamation by a politician can signal to the electorate that damaging publications are merely ‘fake news’. The frequency of defamation litigation involving politicians shows that many perceive defamation law as providing a powerful political weapon.

Memory

'Amazon Echo Dot or the Reverberating Secrets of IoT Devices' by Dennis Giesse and Guevara Noubir in Proceedings of Conference on Security and Privacy in Wireless and Mobile Networks, Abu Dhabi, United Arab Emirates, June 28–July 2, 2021 (WiSec ’21),comments 

Smart speakers, such as the Amazon Echo Dot, are very popular and routinely trusted with private and sensitive information. Yet, little is known about their security and potential attack vectors. We develop and synthesize a set of IoT forensics techniques, apply them to reverse engineer the hardware and software of the Ama- zon Echo Dot, and demonstrate its lacking protections of private user data. An adversary with physical access to such devices (e.g., purchasing a used one) can retrieve sensitive information such as Wi-Fi credentials, the physical location of (previous) owners, and cyber-physical devices (e.g., cameras, door locks). We show that such information, including all previous passwords and tokens, remains on the flash memory, even after a factory reset. This is due to the wear-leveling algorithms of the flash memory and lack of encryption. We identify and discuss the design flaws in the storage of sensitive information and the process of de-provisioning used devices. We demonstrate the practical feasibility of such attacks on 86 used devices purchased on eBay and flea markets. Finally, we propose secure design alternatives and mitigation techniques.

Citizenship Shopping

Ius pecuniae again, with the Guardian reporting that 'the sale of passports' (in other words citizenship-by-investment, aka CBI) brought in over US$100m to the Vanuatu government last year, with Investment Migration Insider clasiming the sales accounted for 42% of all Vanuatu government revenue in 2020. Since January 2020 over 2,000 people have purchased Vanuatu citizenship. That nation has 300,000 people. 

'The pros and cons of ius pecuniae: investor citizenship in comparative perspective' (EUI Working Paper RSCAS 2012/14) by Jelena Dzankic comments 

This paper looks at the economic inclusivity of citizenship regulation and draw parallels between different countries offering naturalisation to investors. The underpinning question of the paper is whether investor citizenship has a merely economic dimension in terms of attracting foreign capital, and whether and when there is also a normative argument for making naturalisation easier for investors. By answering this question, the paper highlights the tension in understanding the logic behind investor citizenship programs. That is, in deciding to naturalise investors, states can either maximize economic utility and grant citizenship to investors by waiving all other naturalisation requirements, or uphold genuine ties with the polity as the core of citizenship by retaining them. 

Citizenship denotes the relationship between the individual and the state, including the rights and duties stemming from an individual’s membership in the polity. Citizenship, as such, is a relationship of reciprocity (Held 1991: 20), which has both a political and a normative dimension. The political dimension of citizenship is intimately related to participation, through which individual members of the community exercise their will. The political aspect of citizenship has implications for the nature of the relationship between the individual and the state, as it also entails the individual’s loyalty to the state and his or her identification with the polity. In cases of individuals born into a polity, this loyalty is assumed and exercised through the duties of citizenship (e.g. law abidance, taxation, military duty). Yet, citizenship is exclusionary for those aspiring to become citizens of a polity. This means that gaining membership to a polity entails fulfilling a set of conditions, which are aimed at proving an individual’s commitment to the state he or she aspires to be admitted into. These conditions stem from the normative facet of citizenship and are encapsulated in nationality laws. 

Naturalisation, or the admission of individuals into the polity, is a prerogative of the state. According to Spiro (2007: 34), naturalisation, albeit used only in exceptional circumstances, has existed in Ancient Rome, whereby citizenship could ‘be conferred on an individual for great acts in the service to the community’. Nowadays, naturalisation conditions are far more regulated, and seek to ensure the establishment of genuine ties between the individual and the polity. They often entail the individual’s physical link with the state (residence), his or her knowledge of the socio-cultural norms of the polity (language and culture tests), moral standing (proof of non-conviction), and financial sustainability (proof of income). 

Yet, citizenship by investment can be obtained with or without residence. The investment may grant the individual the right to reside in another state and acquire citizenship subject to residence and other criteria, or it may result in the outright conferral of citizenship. The former is a common practice, adopted by a number of countries worldwide including the United Kingdom, the United States, Canada, Belgium, Australia, and Singapore. These countries offer premier residence1 to investors, with the assumption that the investment will yield significant economic benefits to their country, while also creating strong links between the individual seeking to be naturalised and the state through mandatory residence. In many cases the residence requirement is the same as for ordinary naturalisation, but some countries may act on a case-to-case basis and reduce the residence requirement for investors (e.g., Austria, Belgium). By contrast, in some countries, the investment may confer citizenship upon an individual regardless of other naturalisation criteria. Although many countries have given the state authorities the discretion to naturalise individuals on grounds of cultural, economic, or other achievements, only two countries have developed detailed investor citizenship programs: Commonwealth of Dominica and St. Kitts and Nevis. In Europe, Austria and Montenegro also implement investor citizenship programs, but these are loosely regulated and thus more reliant on discretionary power of the state authorities. In none of these countries are prospective applicants bound by residence. Such a conferral of citizenship is based on the assumption that the investment in itself is a sufficient proof of an individual’s commitment to the new polity. Given the degree of discretion that governments have in deciding upon naturalisation on these grounds, citizenship by investment programs have raised numerous contentious questions, including those related to tax evasion, extradition, and corruption. 

In the context of the competitive market pressures that exist in the era of global economic interconnectedness, citizenship has become a good with which both states and investors seek to optimise their performance. According to Ong (2005: 627), ‘nation-states seeking wealth-bearing and entrepreneurial immigrants do not hesitate to adjust immigration laws to favour elite migrant subjects, especially professionals and investors’. However, there is a manifest normative tension underpinning the decision of some states to grant citizenship to investors and the objections of others to such a practice. Hence a full understanding of the different ways of regulating and practicing of investor citizenship requires an insight into the economic club good theory of citizenship (Buchanan 1965) that provides an argument for the defence of investment-based naturalisation, as well as in the sphere boundary theory (Walzer 1983) which provides a rationale for rejecting it. 

The economic club good theory of citizenship (Buchanan 1965; Frey and Eichberger 1999) offers an explanation as to why states would seek to co-opt individuals who invest money in the polity. Buchanan’s (1965: 4) theory has an economic rationale in that membership in ‘clubs’, as polities indeed behave, should be based on a cost-benefit analysis. That is, polities produce club goods for their members and should therefore select for membership those individuals whose contribution will optimize the production of club goods. According to Buchanan (1965:8), ‘[t]he bringing of additional members into the club also serves to reduce the cost that the single person will face’. This argument also explains the conditions for naturalisation, whereby an individual is often required to comply with certain pecuniary criteria so as to be allowed to become a citizen of a particular state. By contrast, those who are already members of the polity are not required to meet such criteria. The explanation of this asymmetry of the polity’s behaviour towards its members and those aspiring to that status is that only those people whose contribution can help to decrease the shared costs of membership should be naturalised. This also supports Reich’s (1991: 18) ‘idea that the citizens of a nation share responsibility for their economic wellbeing’. As the operation of markets within the polity entails transactions among individuals, companies, other states, etc., in order to maximise their economic security and performance, states seek to ensure that the naturalised individuals will pose no financial burden on their economies. 

The same rationale is used to explain why polities would facilitate the naturalisation of investors. According to Frey, ‘the optimal size of a club is reached when the marginal utility received corresponds to the marginal cost induced by an additional member’ (2000:6). In fact, the contribution to the country’s economy by the investor is disproportionately higher than the contributions of many of those who are already citizens of a given state. Since the benefits of the investment (such as the boost to the economy, opening of new jobs, etc.) vastly exceed the cost of admitting the investing individual to the ‘club’, the addition of that member would optimize or at least enhance the club’s economic performance. Yet, the economic logic behind facilitated naturalisation for investors undermines the very nature of citizenship. According to Walzer (1983), in determining their citizenship, states act as ‘clubs’, and thus have the prerogative to include or exclude prospective members according to their interest. Carens (1987) challenged this observation of Walzer’s (1983) when he claimed that by doing so, states act as enterprises rather than as public communities, thus failing to acknowledge the boundary between the public and the private spheres: ‘in the private sphere freedom of association prevails and in the public sphere equal treatment does’ (Carens 1987: 269). This implies that in deciding on their membership criteria, states are bound to treat all individuals equally. 

However, the conventional argument, also highlighted by Carens (1987; 1992) is that states have the moral obligation to treat as equals only those who are already their members. There is no obligation for states to treat those who want to naturalise equally as those who are already citizens. Yet, states do have an obligation to treat those who apply for citizenship as equals in the sense of not discriminating in morally arbitrary ways between them. Those who are non-members thus need to comply with the same set of criteria in order to become citizens. The departure from this logic, in contemporary citizenship legislation, is made through different criteria for naturalisation for certain categories of non-members, such as spouses of nationals, expatriates, recognized refugees, etc. The reason for facilitating naturalisation in these cases is premised on the assumption of their pre-existing ties with the aspired community of membership (spouses, children, expatriates), or humanitarian arguments and international legal obligations (refugees). These circumstances enable states to waive some of the criteria for admission, for instance, by reducing the residence requirement. 

A similar logic operates in waiving all other criteria in cases of naturalising individuals on grounds of national interest, or exceptional contribution to the state. The logic of equal treatment is overridden by the asymmetry of gains for the community from an individual’s membership, as outlined by Buchanan (1965). In countries that allow facilitated naturalisation on grounds of exceptional contribution to the state, rewarding such achievements is recognition of merit rather than of money or class. Naturalising investors by waiving all other criteria, however, equalises financial contribution with cultural, sports, and educational achievements. The latter are considered reputational gains ’which are not available for purchase’, and thus investment violates the sphere boundary of money (Walzer 1983: 102). The fast-track admission of investors into a polity breaks the equality principle inherent in the citizenship legislation in that only wealthy individuals are able to offer a significant contribution to the state’s economy. Thus, naturalisation of this kind gives precedence to one social class over others, breaching the sphere boundary of ‘money’ (Walzer 1983) by ‘unlocking’ blocked exchanges that limit the dominance of wealth. It reduces citizenship to a commodity that is traded for money and not for genuine ties with the state, as is the case in ordinary naturalisation. 

Moreover, the discretion in the granting of investor has caused political controversies in a number of countries. Corruption and secret deals, which have manifestly happened in cases of investor citizenship,2 violate the sphere boundary of money as ‘political power and influence cannot be bought and sold’ (Walzer 1983: 100). This fact, however, does not imply that naturalising the investor will affect political power by virtue of a single individual’s participation in the polity’s operation. Rather, the marginal influence of a single vote in a polity will be outweighed by the much stronger concern about corruption of those who have had the discretionary power to decide on the admission of such an individual.comments

Unwell

Another 'stolen honour' incident, withy the ABC reporting that Troy Daniel Barnes has been fined $2,500 Parramatta Local Court and placed on a three-year good behaviour bond after pleading guilty to six charges regarding impersonation of an ADF member. 

Barnes resigned as a NSW POlice senior constable last year after colleagues became suspicious of dramatic war stories he told over nine months, including claims he had beemn awarded service medals, had met warlords, witnessed a woman and child being killed, and jumped from a helicopter during tours of duty in Afghanistan and Iraq. 

The Court heard he took "props" to work, including a knife and a telescope, to substantiate the claims and showed colleagues photographs in which he had photoshopped his face onto images of two decorated veterans. 

 Barnes was initially charged with 29 offences (facing a maximum penalty of six months' jail and $3,300 fine for each charge). He sought to have them dismissed on mental health grounds, with his lawyer arguing that suffered post-traumatic stress disorder after a decade in the police force where movement to a desk job resulted in a "loss of identity". She commented "I'd describe it as locker room talk to his colleagues to perhaps make himself seem more appealing".

Judgment

Singh v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2021] FCA 755 is one of those quotable judgments re the AAT, with Perram J stating

[19] I should briefly mention the reasons of the Federal Circuit Court. These were at [59]-[60] and [63]:

Mr Karp’s reference to the evidence of the particular witnesses in paragraph (a) did not identify any material or significant evidence that was not the subject of genuine intellectual consideration by the Tribunal. The Tribunal expressly referred in paragraph 6 of its reasons to the evidence of witnesses and further referred to the evidence of witnesses in its reasons, as summarised above. There is no basis to find that the Tribunal did not take into account the evidence of the witnesses, notwithstanding Mr Karp’s submissions to the contrary. There was no material or significant evidence identified by the witnesses that the Tribunal was required to further expressly engage with in the circumstances of the findings made by the Tribunal in this case. 

The Tribunal does not have to refer to every item of evidence before the Tribunal and is not required to specifically discuss and evaluate every piece of evidence. The Tribunal did refer to the witnesses, and the fifth witness’s evidence was summarised at paragraph 28 of the Tribunal’s reasons. The Tribunal, however, was not bound to accept the witnesses’ opinions. It is apparent that the Tribunal took into account the applicant’s mother’s views as to there being a marriage between the sponsor and the applicant and it also expressly referred to the applicant’s mother’s evidence about having lived with the parties. 

... The Tribunal also made express reference to the number of witnesses advanced in the submissions as having indicated there was a genuine relationship. There is no basis to infer that the Tribunal overlooked this submission or the evidence. The Court does not accept that there was any material or significant evidence that required further express consideration by the Tribunal in respect of the persons identified by the particulars to particular (a). The Tribunal reasons as summarised above evidence that the Tribunal had a genuine intellectual engagement with evidence and submissions advanced by the applicant. No jurisdictional error is made out by particular (a).

[20] For the reasons I have given, this is entirely erroneous. It reflects a complete lack of intellectual engagement with the argument which was being put and is indicative of a judicial method in which meaningless phrases are unthinkingly gathered from the authorities like twigs and patched together in some kind of forensic bird’s nest. Judgments like this are a blot on the judicial department of government. The appeal must be allowed with costs. Mr Karp also raised a similar argument in relation to the evidence of Mr Manjinder Singh and a psychologist, Mr Gachon. It is not necessary to deal with these in circumstances where the decision of the Tribunal is to be set aside. 

[21] For completeness, it should be noted that the next hearing in the Tribunal will be the fourth time it will have attempted to determine the Appellant’s review application according to law. The first decision, made on 2 July 2015, was set aside by consent when the parties agreed in the Federal Circuit Court that the Tribunal had failed to consider the mandatory matters in reg 1.15A(3) of the Regulations, which include the very same question involved in this appeal: ie the social aspects of the relationship. The second Tribunal decision made on 2 November 2016 was set aside when it came to light that the second Tribunal had extensively plagiarised the first Tribunal’s reasons. The third Tribunal’s decision made on 22 November 2019 will now be set aside because it failed to consider evidence which was favourable to the Appellant under reg 1.15A(3). The Appellant’s initial application for review of the delegate’s decision was filed with the Tribunal as long ago as 12 December 2013 and the Tribunal has now been considering this entirely straightforward matter for nearly 8 long years. It is to be hoped that the Appellant, who is still a relatively young man, lives a long enough life to see the Tribunal deal with his review application according to law. It is by no means too much to expect that the Tribunal takes into account the matters which by law it is required to take into account, that it does not unwisely plagiarise earlier decisions which have been set aside and that it remembers to consider not only the evidence which is unfavourable to the Appellant but also that which is in his favour. Public confidence in the Tribunal resides in its reputation for competence. The conduct of the present review application is apt to undermine that confidence.