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Trade agreements (eg: ChAFTA in this case) typically contain clauses which restrict the ability to pass laws that directly harm the interests of one countries

Trade agreements (eg: ChAFTA in this case) typically contain clauses which restrict the ability to pass laws that directly harm the interests of one countries investments in the other. But in any case, transmission grid operators are natural monopolies that are usually heavily regulated and can’t simply charge whatever they want. I’m sure South Australia’s grid is no different.

kurthr 4y ago
Well, based on that every utility should be sold off to a foreign country since only then are you prevented global trade laws and treaties from passing laws (or even failing to enforce civil fines?) that harm their interests. Frankly, I'm doubtful this is a case of actual enforcement of global trade rules, it's pure economic power. That works until it doesn't, and even the purchasers of these profitable "rights" know this. That's why they want to get their money out quickly, but once the local government has turned against you it's rarely worth fighting even for the largest funds.
pas 4y ago
Trade agreements usually contain provisions for dispute resolution. Back before 2016 the big boogeyman was ISDS (investor-state dispute settlement). If a state made a bad deal they can either renegotiate it (eg. negotiate in a fee to cancel the whole contract) or try for arbitration (and the tribunal might set a fee for cancellation), or assert their sovereignty. Of course with China everything that reaches political circles becomes a power-play, but at least in the first two cases they are less motivated to respond in kind (ie. levy tariffs or fuck with the business of Australian companies in China).
- Reason077 4y ago
  Sure, but there's no dispute here that I'm aware of. Turns out the South Australia grid isn't really owned by China anyway - they have a 46.6% stake, with the other 53.4% controlling interest now held by Australian Utilities, a consortium of Australian infrastructure and pension funds. https://realassets.ipe.com/news/australian-utilities-trust-emerges-as-electranets-majority-shareholder/10057935.article https://realassets.ipe.com/news/australian-utilities-trust-e...

kurthr 4y ago

Well, based on that every utility should be sold off to a foreign country since only then are you prevented global trade laws and treaties from passing laws (or even failing to enforce civil fines?) that harm their interests. Frankly, I'm doubtful this is a case of actual enforcement of global trade rules, it's pure economic power. That works until it doesn't, and even the purchasers of these profitable "rights" know this. That's why they want to get their money out quickly, but once the local government has turned against you it's rarely worth fighting even for the largest funds.

pas 4y ago

Trade agreements usually contain provisions for dispute resolution. Back before 2016 the big boogeyman was ISDS (investor-state dispute settlement). If a state made a bad deal they can either renegotiate it (eg. negotiate in a fee to cancel the whole contract) or try for arbitration (and the tribunal might set a fee for cancellation), or assert their sovereignty. Of course with China everything that reaches political circles becomes a power-play, but at least in the first two cases they are less motivated to respond in kind (ie. levy tariffs or fuck with the business of Australian companies in China).

Reason077 4y ago
Sure, but there's no dispute here that I'm aware of. Turns out the South Australia grid isn't really owned by China anyway - they have a 46.6% stake, with the other 53.4% controlling interest now held by Australian Utilities, a consortium of Australian infrastructure and pension funds. https://realassets.ipe.com/news/australian-utilities-trust-emerges-as-electranets-majority-shareholder/10057935.article https://realassets.ipe.com/news/australian-utilities-trust-e...