by Eva Hampl
In May 2009, the European Union launched negotiations with Canada for the Comprehensive Economic and Trade Agreement (CETA). After five years of negotiations, they successfully concluded in August of 2014, and the Canada-EU summit in September 2014 officially marked the end of the negotiations of the agreement, which promises to remove over 99 percent of tariffs between the two economies. CETA is the first agreement where the EU has negotiated investment provisions drastically different from the long-established language found in European investment treaties, many akin to what is also provided in our U.S. Model Bilateral Investment Treaty (BIT). The EU has also been negotiating a Transatlantic Trade and Investment Partnership (TTIP) with the U.S. since 2013. Negotiations on the investment chapter in TTIP resumed only recently, following an extended process and public debate in Europe on investment protection.
Today investment accounts, directly or indirectly, for a significant and growing percentage of cross-border commerce, encompassing vast global supply chains, and businesses rely on strong investment protections for legal certainty in many countries around the world. Accordingly, investment agreements and chapters continue to be of great importance.
Until a few years ago, the public in Europe had not paid much attention to investor-state dispute settlement (ISDS), however has now taken up this cause in an effort to negatively impact agreements such as CETA as well as the TTIP. The widely publicized public debate on ISDS in Europe has been very ideological and emotional in parts, resulting in a politicization of the issue, the response to which was a political solution: “improving” the world of international investment agreements (IIAs), by providing solutions to not quite clearly articulated problems. One such “solution” is the proposal of an international investment court, consisting of a roster of judges, as described in detail in the EU’s proposal for an investment chapter in the context of the TTIP negotiations.