Brussels, 15/07/2014 (Agence Europe) - On the sidelines of the sixth round of free-trade negotiations between the EU and USA (transatlantic trade and investment partnership - TTIP - negotiations) in Brussels this week, the European Commission announced on 14 July that it was beginning its analysis of the responses to its public consultation on the controversial issue of investment protection and investor-state dispute settlement (ISDS) in the TTIP.
The survey - launched in March and extended by a week in view of the flood of comments by stakeholders - closed on 13 July. “European citizens and interest groups replied in large numbers”, said the Commission, announcing that it “will soon confirm” the precise number of responses received, their origin by EU country, and the types of respondent who submitted them. The Commission promises to “look at the responses carefully” over the next few months, before publishing a report on the results “towards the end of 2014” - a report which will contain strategic recommendations.
At the launch of the public consultation on 27 March, European Commissioner for Trade Karel De Gucht argued in favour of the ISDS as an instrument enabling the climate for investment to be improved, and also as an instrument enabling arbitration to be more transparent and better delineated. In response to the concerns and loopholes mentioned in the public debate, De Gucht promised to develop an “innovative approach” for the ISDS - on the one hand, by clarifying and improving the rules on the protection of investments so as to guarantee that the right to legislate is not threatened; and on the other hand, by developing a modern ISDS mechanism that can prevent risks of abuse, making the system of arbitration more transparent, and that can prevent conflicts of interests or differences between the mediators. While ensuring more consistency and control, the new ISDS mechanism will be applied only in the case of breaches of the arrangements on the protection of investments, to the exclusion of any other part of the TTIP (see EUROPE 11048).
In the meantime, De Gucht last week hailed the United Nations initiative to increase transparency in the settlement of disputes between investors and states. According to the new rules adopted by the United Nations Commission on International Trade Law (UNCITRAL), any bilateral investment treaty concluded after 1 April 2014 will have to allow the public access to all documents in the event of a dispute between investors and states. The EU will be the main funder of the UN database accessible to the public (see EUROPE 11121).
The European Commission is nevertheless under some pressure. The inclusion of the ISDS mechanism in the TTIP - which is very much supported by the USA - remains a burning issue. Those who oppose it - anxious that the inclusion of this mechanism might dissuade states from regulating on social, environmental, and health protection issues for fear of being taken to court by multinationals that consider they have been wronged by public policies - stand firmly by their position. On Monday, health NGOs demanded that the ISDS be excluded from the future TTIP agreement (see EUROPE 11121).
In a joint statement last week, the European Trade Union Confederation (ETUC) and the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) reaffirmed their opposition to an ISDS mechanism in TTIP - a mechanism “which grants special legal rights and privileges to foreign corporations”. “The US has already lost state-to-state challenges to its anti-smoking, meat labelling and tuna labelling policies, and even now, European multinationals are using the investor-to-state system to challenge decisions to phase out nuclear energy and raise minimum wages. Simply put, these policies are part of a government's most basic responsibility to promote the general welfare of its people”, the ETUC and AFL-CIO state in a press release published on 10 July. (EH)