Investor-State Protection

In 2009, the EU and Canada started negotiate about the future Comprehensive Economic and Trade Agreement (CETA). The negotiations are now in their final phase. The negotiations covers for example access to each other’s markets, the framework for investment, the movement of professionals between the parties, and rules that frame trade.

Despite the fact that the Parliament clearly rejected the Anti-Counterfeiting Trade Agreement (ACTA), there is a risk that some parts of the impugned proposal returns in the CETA. The Commission insists that the accusations are unfounded.

Title II, Article 9 of the Consolidated Version of the Treaty on European Union says that “In all its activities, the Union shall observe the principle of the equality of its citizens, who shall receive equal attention from its institutions, bodies, offices and agencies.”


Amelia’s first question (2012-12-06) about this why the ordinary court system is not good enough for the investors when it is good enough for all others citizens. She also wants to know how the treaty is compatible with the CETA, since the investors are given additional attention with the Investor-State Dispute Settlement (ISDS). The Commission answered that there has been several cases where foreign investors in Canada has been denied access to Canadian courts, and by guaranteeing access to international courts the ISDS mechanism ensures that European investors in Canada would be granted an effective remedy. The rights in question are granted because the investor is a foreign investor.

The second question (2012-12-07) is about the fact that a representative of the Commission has said that the ISDS mechanism in the CETA was only of “some economic value”, and at the same time the Commission says that the actual reason for including the mechanism in the CETA is its political value. Amelia wants to know why chapters with only “some economic value” are included in the agreement, and what the context of the term “political value” is. The Commission answered that the ISDS chapter in the CETA would protect European investors in Canada by granting them access to an international tribunal, and therefore the mechanism is of significant economic value.

In the third question (2012-12-10) Amelia wants to know why the Commission has chosen to ignore the advices of their own experts, which concludes that a state-state dispute settlement mechanism is a more appropriate enforcement mechanism in CETA than an investor-state dispute settlement. The Commission answered that the Sustainability Impact Assessment explicitly states that it does not represent the views of the Commission. The Commission also says that they consider that an investor-state dispute settlement mechanism is more appropriate than a state-to-state dispute settlement.

The fourth question (2013-02-04) is a follow-up to the second, and Amelia asks the Commission for more information about cases of expropriation in which European or other investors apparently did not receive any compensation and were not able to start legal proceedings in Canada. In its answer, the Commission listed to cases where this has happened, the case Abitibi Bowater verses Canada and the case Gallo verses Canada.