Brussels, 17/03/2014 (Agence Europe) - Like France, Germany is against the inclusion of an investor-state dispute mechanism in the free-trade agreement.
Reporting the results of last week's fourth round of TTIP negotiations in Brussels to the press on 14 March, the chief EU and US negotiators, Ignacio Bercero and Dan Mullaney respectively, did not get caught up in conjecture in their replies to questions from journalists on the opposition shown by Paris and Berlin to the inclusion of an investor-state dispute mechanism (ISDS) in the agreement. “A comprehensive 21st century trade agreement should include appropriate protection for investors. That does include ISDS”, said Mullaney, who nevertheless believed it is “important that these provisions respect national regulatory space”. Bercero, for his part, reiterated that the ISDS was part of the negotiating mandate granted to the Commission “by unanimity” of the member states.
In the middle of last week, Germany clearly showed its opposition to the inclusion of an ISDS in the future TTIP agreement. “The federal government is doing all it can to ensure that it doesn't come to this. We are currently in the consultation process and are committed to ensuring that the arbitration tribunals are not included in the agreement. The German federal government's view is that the US offers investors from the EU sufficient legal protection in its national courts. Equally, US investors in Germany have sufficient legal protection through German courts”, Germany's Minister for Economic Affairs Brigitte Zypries told the Bundestag on 12 March, as reported by German daily newspaper Die Zeit. “Arbitration tribunals of this kind should only be brought in as a last resort after exhausting all legal remedies brought in national courts”, she added. At the end of January, France's Minister for Trade Nicole Bricq had also highlighted her opposition to the ISDS, believing that a state to state dispute settlement mechanism is enough under the TTIP.
The negotiation between the Commission and the US administration of a protection clause for investors in the form of an ISDS is of concern to NGOs and unions, which fear that such a mechanism discourages states from settling social and environmental issues. The court case over health warnings on cigarette packets, which is being conducted by world tobacco leader Philip Morris against Uruguay and Australia, constitutes a dangerous precedent in the eyes of NGOs and unions.
However, the Commission - which wants to keep room for manoeuvre in negotiating - is anxious to ensure that the ISDS is not totally withdrawn from the negotiating table (as has already happened with the audiovisual sector) - and all the more so because the US is unwilling to include the regulation of financial services in the TTIP. The Commission has currently shelved the ISDS discussions with the US, while it awaits the results of the three-month public consultation launched at the end of January. Bercero hopes that the consultation will be “an opportunity to come forward with a much improved model on the standards of protection with much clearer provisions on transparency and conflicts of interest”. (EH)