On August 29, USCIB and the National Association of Manufacturers (NAM) co-hosted a very useful briefing on the challenging investment chapter issues in the just-launched NAFTA updating negotiations with senior officials from the Office of the U.S. Trade Representative (USTR). The USTR lead investment negotiators were joined by other senior USTR officials and a business side of two dozen company and trade association representatives with major concerns about the NAFTA investment chapter, especially the important issue of “Investor-State Dispute Settlement” (ISDS). The business turnout at a short notice meeting in late August is a clear demonstration of the importance that USCIB members and the broader community ascribe to these investment issues. The US negotiating team was heading to Mexico City for the second round in the NAFTA updating negotiations September 1-5.
Most of the meeting consisted of business reps around the table offering their comments, concerns, questions and recommendations regarding USTR’s approach to these investment negotiations. By design, the USTR team did more listening than talking. USCIB and NAM staff led the business comments and were very clear and direct with our concerns and recommendations. We also had broad and strong participation around the table from companies and associations from a wide range of sectors. The key points made by a number of business representatives included:
- The NAFTA investment chapter has generally worked quite well for U,.S business. We are open to well-crafted proposal to improve the chapter but, as in many other important chapters in NAFTA, our basic watchword will be “first, do no harm.”
- Business needs a strong investment chapter in NAFTA and in other U.S. Free Trade Agreements (FTAs) and Bilateral Investment Treaties (BITs), including high standard core substantive investment protections, broad coverage and definitions to include new forms of foreign direct investment , and, critically, strong ISDS provisions to ensure enforcement.
- We are quite concerned by recent press report that the Administration might be considering a proposal to make the ISDS enforcement provisions “optional”, whereby each of the three NAFTA government could “opt in” or “opt out” of NAFTA’s ISDS dispute settlement provisions. If a government of governments were to opt out, the only way an aggrieved foreign investor could seek redress would be in the local court system of the host government. USCIB and company and associations reps around the table made clear that such revisions in NAFTA’s investment chapter would be unacceptable.The discussion was, we thought, very useful for all participants and will hopefully provide a model for on-going consultations with USTR on all the key investment issues throughout the negotiations. Members interested in getting more involved in USCIB’s efforts on NAFTA investment issues should contact Shaun Donnelly or Eva Hampl.