IRAQ IS NOT BUSH'S TO SELL; PRIVATIZATION IS 100% ILLEGAL (N KLEIN)

"..most of the controversy surrounding Iraq's reconstruction has
focused on the..corruption in the awarding of contracts. This
badly misses the scope of the violation: even if the sell-off of Iraq
were conducted with full transparency and open bidding, it would still
be illegal for the simple reason that Iraq is not America's to sell"

"Iraq's constitution outlaws the privatisation of key state assets,
and it bars foreigners from owning Iraqi firms...because Bremer's
reforms directly contradict Iraq's constitution, they are "in breach
of international law and are likely not enforceable". Blanch argues
that the CPA "has no authority or ability to sign those
[privatisation] contracts"..The only way out for the administration is
to make sure that Iraq's next government is anything but sovereign.
..[which would] be celebrated as the happy marriage of free markets
and free people. Once that happens, it will be too late: the contracts
will be locked in.

"Which is why anti-war forces must use this fast-closing window to
demand that the next Iraqi government be free from the shackles of
these reforms. It's too late to stop the war, but it's not too late to
deny Iraq's invaders the myriad economic prizes they went to war to
collect in the first place."

IRAQ IS NOT AMERICA'S TO SELL

International law is unequivocal - Paul Bremer's economic reforms are
illegal

Naomi Klein
Friday November 7, 2003
The Guardian

Bring Halliburton home. Cancel the contracts. Ditch the deals. Rip up
the rules. Those are just a few of the suggestions for slogans that
could help unify the growing movement against the occupation of
Iraq. So far, activist debates have focused on whether the demand
should be for a complete withdrawal of troops, or for the United
States to cede power to the United Nations.

But the "troops out" debate overlooks an important fact. If every last
soldier pulled out of the Gulf tomorrow and a sovereign government
came to power, Iraq would still be occupied: by laws written in the
interest of another country; by foreign corporations controlling its
essential services; by 70% unemployment sparked by public sector
layoffs.

Any movement serious about Iraqi self-determination must call not only
for an end to Iraq's military occupation, but to its economic
colonisation as well. That means reversing the shock therapy reforms
that US occupation chief Paul Bremer has fraudulently passed off as
"reconstruction", and cancelling all privatisation contracts that are
flowing from these reforms.

How can such an ambitious goal be achieved? Easy: by showing that
Bremer's reforms were illegal to begin with. They clearly violate the
international convention governing the behaviour of occupying forces,
the Hague regulations of 1907 (the companion to the 1949 Geneva
conventions, both ratified by the United States), as well as the US
army's own code of war.

The Hague regulations state that an occupying power must respect
"unless absolutely prevented, the laws in force in the country". The
coalition provisional authority has shredded that simple rule with
gleeful defiance. Iraq's constitution outlaws the privatisation of key
state assets, and it bars foreigners from owning Iraqi firms. No
plausible argument can be made that the CPA was "absolutely prevented"
from respecting those laws, and yet two months ago, the CPA overturned
them unilaterally.

On September 19, Bremer enacted the now infamous Order 39. It
announced that 200 Iraqi state companies would be privatised; decreed
that foreign firms can retain 100% ownership of Iraqi banks, mines and
factories; and allowed these firms to move 100% of their profits out
of Iraq. The Economist declared the new rules a "capitalist dream".

Order 39 violated the Hague regulations in other ways as well. The
convention states that occupying powers "shall be regarded only as
administrator and usufructuary of public buildings, real estate,
forests and agricultural estates belonging to the hostile state, and
situated in the occupied country. It must safeguard the capital of
these properties, and administer them in accordance with the rules of
usufruct."

Bouvier's Law Dictionary defines "usufruct" (possibly the ugliest word
in the English language) as an arrangement that grants one party the
right to use and derive benefit from another's property "without
altering the substance of the thing". Put more simply, if you are a
housesitter, you can eat the food in the fridge, but you can't sell
the house and turn it into condos. And yet that is just what Bremer is
doing: what could more substantially alter "the substance" of a public
asset than to turn it into a private one?

In case the CPA was still unclear on this detail, the US army's Law of
Land Warfare states that "the occupant does not have the right of sale
or unqualified use of [non-military] property". This is pretty
straightforward: bombing something does not give you the right to sell
it. There is every indication that the CPA is well aware of the
lawlessness of its privatisation scheme. In a leaked memo written on
March 26, the British attorney general, Lord Goldsmith, warned Tony
Blair that "the imposition of major structural economic reforms would
not be authorised by international law".

So far, most of the controversy surrounding Iraq's reconstruction has
focused on the waste and corruption in the awarding of contracts. This
badly misses the scope of the violation: even if the sell-off of Iraq
were conducted with full transparency and open bidding, it would still
be illegal for the simple reason that Iraq is not America's to sell.

The security council's recognition of the United States' and Britain's
occupation authority provides no legal cover. The UN resolution passed
in May specifically required the occupying powers to "comply fully
with their obligations under international law including in particular
the Geneva conventions of 1949 and the Hague regulations of 1907".

According to a growing number of international legal experts, that
means that if the next Iraqi government decides it doesn't want to be
a wholly owned subsidiary of Bechtel and Halliburton, it will have
powerful legal grounds to renationalise assets that were privatised
under CPA edicts.

Juliet Blanch, global head of energy and international arbitration for
the huge international law firm Norton Rose, says that because
Bremer's reforms directly contradict Iraq's constitution, they are "in
breach of international law and are likely not enforceable". Blanch
argues that the CPA "has no authority or ability to sign those
[privatisation] contracts", and that a sovereign Iraqi government
would have "quite a serious argument for renationalisation without
paying compensation". Firms facing this type of expropriation would,
according to Blanch, have "no legal remedy".

The only way out for the administration is to make sure that Iraq's
next government is anything but sovereign. It must be pliant enough to
ratify the CPA's illegal laws, which will then be celebrated as the
happy marriage of free markets and free people. Once that happens, it
will be too late: the contracts will be locked in, the deals done and
the occupation of Iraq permanent.

Which is why anti-war forces must use this fast-closing window to
demand that the next Iraqi government be free from the shackles of
these reforms. It's too late to stop the war, but it's not too late to
deny Iraq's invaders the myriad economic prizes they went to war to
collect in the first place.

It's not too late to cancel the contracts and ditch the deals.

http://www.guardian.co.uk/usa/story/0,12271,1079602,00.html

* A version of this article appears in the Nation.
[http://www.thenation.com/]

RESOURCE:

Q/A: Why The Privatization is Illegal:

http://www.guardian.co.uk/comment/story/0,3604,1079562,00.html


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