Authored by Luciana Ghiotto – Associate Researcher at the Transnational Institute (TNI).
In February 2025, the governments of Ecuador and Canada announced the conclusion of negotiations of a free trade agreement (FTA). This treaty contains an investor-state dispute settlement (ISDS) mechanism that allows foreign corporations to sue the Ecuadorian government in private international tribunals when they believe that their expected profits have been or will be affected. However, this mechanism violates article 422 of the 2008 Constitution, which prohibits the state from surrendering its sovereign jurisdiction to international arbitration bodies in disputes with foreign investors.
This paper examines five dimensions that explain the importance of the Ecuador-Canada treaty today: the geopolitical race for critical minerals such as copper; the history of Canadian mining companies’ use of international arbitration; the government’s strategy to do away with article 422; Canada's double standard on ISDS, and the proliferation of investment protection agreements with Canadian mining companies to circumvent the constitutional prohibition. It concludes by establishing the connection between this treaty and the upcoming referendum on November 16, 2025, in which one of the questions proposes that a Constituent Assembly be held.