Brussels, 22/09/2003 (Agence Europe) - The United States, the European Commission and seven future Member States from central and Eastern Europe on Monday signed a "Memorandum of Understanding" (MoU), negotiated over the past several months between Brussels and Washington, and which lays down a series of changes to be made by 1 May 2004 to bilateral investment treaties (BITs) in force between the United States and the countries in question: Poland, Slovakia, Estonnia, Lithuania, Latvia, Bulgaria, and Romania. An eighth country connected to the United States by a BIT, the Czech Republic, will also sign the MoU very soon. Hungary and Slovenia are not involved, as they have no bilateral investment treaty with Washington. The Commission had insisted on adapting the BITs before enlargement, as it thought that several provisions of these agreements concluded in the early 1990s (after the wall came down) were incompatible with the acquis communautaire, notably those giving "national treatment" to American investors (see EUROPE of 9 September, p.11). In order to prevent American investors established in the new Member States from, for example, benefiting from agricultural subsidies under CAP or European aid and production quotas in the audiovisual sector on the basis of this national treatment principle, the Commission asked the United States to resign all claim to national treatment in a number of "sensitive" sectors (agriculture, audiovisuals, financial services, transport, fisheries, energy). The United States agreed.
On Monday; at the sidelines of the signing of the MoU and of the individual bilateral protocols implementing it, American negotiator Wesley Scholz (director of investment affairs) stressed how important keeping BITs with the future Member States was for "reassuring" American investors in these countries. "The adjustments we have had to make [resigning national treatment in sensitive sectors] were only a small price to pay" compared to the advantages these agreements bring to current and future investors. BITs give a "special security" to American investments, as they provide for international arbitration in the case of a dispute, for instance, and the application of very strict rules in the case of compulsory purchase, said Mr Scholz.
At the time of writing, the United States have concluded BITs with 45 countries throughout the world, and others are being negotiated. None of the fifteen current Member States has signed such an investment agreement with Washington.