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TPP pact under parliamentary scrutiny

AAP logoAAP 30/09/2016 Lisa Martin

A parliamentary examination of a controversial Pacific trade pact could prove ultimately pointless, with the agreement looking increasingly doomed.

The Trans-Pacific Partnership agreement has become a toxic issue in the US ahead of the November presidential election, with both Hillary Clinton and Donald Trump opposing the 12-nation pact.

It's unlikely to attract enough support in Congress amid a public backlash in different countries towards globalisation.

Prime Minister Malcolm Turnbull lobbied US politicians to stay the course on the free-trade agenda during his recent visit to the US.

Despite its fading prospects, parliament's treaties committee is holding inquiry hearings in Perth next Wednesday and Melbourne on Friday.

Perth-based mining company Planet will give evidence extolling the merits of a controversial aspect of the deal - investor-state dispute settlements.

The clauses allow foreign investors to access an international tribunal if they believe actions taken by a host country's government breach investment obligations.

Planet managing director Nicholas Smith will argue the clauses help give smaller exploration companies the confidence to invest capital in developing countries where the rule of law may not be as strong as Australia.

"Treaties like the TPP are therefore very important tools for the promotion and protection of foreign investment," he said in a submission to the inquiry.

Planet dismissed the arguments of free-trade agreement critics that the clauses exposed Australia to frivolous legal action by foreign investors.

"We think the risk is being overstated," Mr Smith said.

The company briefly detailed its own experience using investor-state dispute settlements proceedings against Indonesia over a coal project in East Kalimantan.

Planet and its parent company Churchill Mining spent $US70 million ($A92 million) on exploration activities and discovered a major coal resource.

However, the head of the local East Kutai sub-regional government unilaterally revoked mining licences in 2010.

The company claims the revocation was aimed at transferring the licences to Indonesian-owned companies controlled by wealthy businessmen and politicians.

The arbitration action is before the International Centre for Settlement of Investment Disputes in Washington DC.

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