A new approach to investment protection and dispute settlement has been agreed by the European Commission and the Canadian government.
This new amendment to the EU-Canada Comprehensive Economic and Trade Agreement (CETA) has been made to reflect the EU's new approach on investment, as outlined in the its Transatlantic Trade and Investment Partnership proposal of November 2015, and marks a clear break from the older Investor to State Dispute Settlement approach.
As part of the changes, stronger language will be adopted on the right to regulate for all levels of government regarding investment protection, with efforts made to move away from an ad hoc arbitration system towards a permanent and institutionalised dispute settlement tribunal.
Meanwhile, more detailed commitments on ethics will be implemented to avoid any conflicts of interest, as well as an appeals system comparable to that found in domestic legal systems. Additionally, the EU and Canada have pledged to engage in joint efforts with other trading partners to set up a permanent multilateral investment court with a standing appellate mechanism.
European Commission first vice-president Frans Timmermans said: "With the changes we have agreed, we bring CETA fully in line with our new approach on investment protection in trade agreements.
"In particular, we demonstrate our determination to protect governments' right to regulate, and to ensure that investment disputes will be adjudicated in full accordance with the rule of law."
The new provisions will help to further accentuate the potential benefits of the CETA deal, which will remove 99 per cent of customs duties between the EU and Canada, leading to tariff savings for EU exporters of around €470 million (£366.19 million) a year for industrial goods.
It will also end limitations in access to public procurement, making it possible for EU firms to bid for Canadian public contracts, while also opening up the services market and ensuring Canada recognises the special status of the EU's Geographical Indications.
