Arbitration (Amendment) Bill 2025: Committee Stage
Seanad Éireann — 2026-05-20
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Michael McDowell (IND), National University of Ireland

I welcome the Minister of State, Deputy Thomas Byrne, and his officials. As I said in the very limited time that was available on Second Stage, I am totally opposed to the enactment of this Bill. I want to make a few points.
First, I am fully in favour of free trade. I do not believe in tariffs. As between Ireland and Canada, I have no problems with the European Union concluding a trade with agreement with Canada for the importation and exportation of goods and services between the two jurisdictions, namely the member states of the European Union, which are independent states, on the one hand, and Canada, which is a highly respectable, stable democracy, even if it is, at present, under siege from the appalling rhetoric of President Trump, on the other.
The second point is that I do not believe that any real Irish interest is served by the Comprehensive Economic and Trade Agreement, CETA, being ratified. The free tree trade elements of CETA are already in operation, so the positive benefits of the agreement are already in play.
Nobody that I know of in this House is opposed to those already existing elements continuing to operate. As a matter of European law, the EU is not competent to conclude this agreement except by the individual ratification of all its member states. At the moment, or as last advised, 17 EU member states have indicated their willingness to ratify it and ten states in the EU have yet to ratify it. This is something in which we have a free choice. This Bill is before us because former Deputy Patrick Costello brought a case in the High Court effectively to prevent Ireland from ratifying the CETA agreement on the grounds that it was an impermissible derogation from Irish sovereignty, on which point he won by a majority of four to three in the Supreme Court. The Supreme Court held that for Ireland to ratify this agreement, with the Constitution as it is and the law as it was, would be unconstitutional. So we start from there.
As I indicated on the last occasion, being in favour of free trade and tariff-free imports and exports between countries does not mean being in favour of elevating international capital or international corporations to the status of sovereign independent states - bodies that can go to a tribunal and have a sovereign state made amenable to the order of that tribunal, except insofar as a sovereign state agrees voluntarily to accept that state of affairs by way of some international agreement. It is well worth noting that Belgium, Bulgaria, Cyprus, France, Greece, Hungary, Ireland, Italy, Poland and Slovenia have not ratified the CETA agreement. These are not just outliers. France, Poland, Hungary and Ireland are countries which are significant players in the European Union's affairs. What I find problematical about this Bill is that its effect is not stated honestly to the Irish people. I listened carefully to the Minister of State's reply on Second Stage and I agreed with a lot of it. This does not prevent Ireland from regulating huge areas which are part of our sovereign entitlement as a member state. We are not totally bound by this agreement to surrender those powers of regulation, as the Minister says. I accept that proposition.
However, that is not what is at stake here. I regard it as unfortunate that the Supreme Court, when asked by former Deputy Patrick Costello to rule whether Ireland could ratify the CETA agreement as it stood by reference to the Constitution, ruled by a majority that it could not do so - that the Constitution did not permit the State to do so. Unfortunately, the majority agreed to a formula put forward by Mr. Justice Gerard Hogan which effectively said we should amend our Arbitration Act so as to qualify the enforceability of the decisions of the appeal court envisaged by the CETA agreement to make them unenforceable in the High Court in Ireland, and presumably in the Irish courts of appeal, if they adversely affected the constitutional order of the Irish State on the one hand or European law on the other.
I have the greatest respect for the judges of the Supreme Court and in particular Mr. Justice Gerard Hogan, but it was not his function to speculate on what amendment would or would not get the Government out of its difficulty. I do not see it as the function of the Supreme Court to effectively advise proofs as to how Ireland could ratify CETA without offending the Constitution. Why do I say that? First, it was prejudging a broader issue as to whether the combined effect of this Bill, if enacted, and the CETA agreement are, in fact, constitutional. It was prejudging that issue and the Supreme Court should not do that. If this Bill was put before the Legislature and enacted into law, it was perfectly open to somebody to decide to litigate it before a court which has not committed itself to any propositions in relation to the question as to whether this Bill actually does clear the decks, so to speak, for Ireland's ratification.
Therefore I think it was an unfortunate, if well-intentioned, peradventure into what is in fact the political sphere for the Supreme Court to say that if the Legislature comes up with an amendment to the Arbitration Act, there is no constitutional problem insofar as it provides in the amending Act that there is a residual capacity on the part of the Irish courts to refuse to enforce the decisions of the arbitral court and the appeal court provided for in CETA on the grounds, crucially, that they would adversely affect the constitutional order of the State.
What is the constitutional order of the State? We do not know in advance what the constitutional order of the State will turn out to be in this context. It is a very vague phrase. It is what the Supreme Court in the end will decide it means if a challenge comes to this legislation or to Ireland's ratification at a later stage. The real question is as follows. Is the formula put forward by Mr. Justice Hogan's judgment, in which a majority of the Supreme Court ruled that Ireland's ratification of CETA would be unconstitutional without it, effective? I do not think it is. I do not think it has any effect at all. I think it is a legal fig leaf, a fiction and a fantasy.
I might elaborate on that point.
Section 25A to be inserted proposes that an award of the appeal court provided for by CETA is "not ... enforceable in the State if enforcing the award would compromise ... the constitutional order of the State." What does that mean? What is the constitutional order of the State we are talking about? What is the implication of that vague sentence? Mr. Justice Hogan was not legislating when he handed down his opinion as to a possible cure for the inability of the State to ratify CETA. In the language he used he was not purporting to determine what would be the constitutional order of the State. He was not saying that one set of circumstances would be compatible with the constitutional order of the State but another would not. He was not attempting any of that. Yet, we have this half-mangled sentence from his judgment put down before us as if it is a cure-all - the placebo pill effect. We are supposed to say that this cures the problem because the majority of the Supreme Court has said that if the Arbitration Act is amended to include a formula of this kind - not in those exact words - and if we do what was hinted at by the majority in the Supreme Court by putting in this formula of words in the amending statute to the Arbitration Act, the constitutional problem goes out the window.
There are so many obvious problems with this. It is, as presented to this House, a sham. If I did not believe that I would not say it. First of all, it is utterly vague. I do not know whether a particular set of circumstances would offend the constitutional order of the State at all. I do not know what that means but I know that a jurisdiction is being created for the High Court in Ireland to consider that question. Let us be clear that every statute has that written into it, implicitly. The Road Traffic Act has that written into it. It must be interpreted in accordance with the Constitution. Is that what we are talking about? Is that what this great cure-all supposedly achieves? Every single Bill we pass in this House is impressed with the imperative that it must be consistent, must be applied by the courts and everywhere else, and disapplied if it does not satisfy the test that it is compatible with the constitutional order of the Irish State. This is nothing new. Every single Act and statutory instrument must be interpreted in that way.

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Record URI: https://data.oireachtas.ie/akn/ie/debateRecord/seanad/2026-05-20/debate/main
Retrieved: 2026-08-14T04:54:58+00:00
Sitting date: 2026-05-20