Trade Gurus & Public Affairs Mavens

Germany’s Objections to Investor Protection in CETA and TTIP

Reports from Berlin over the weekend indicated that Germany cannot accept the Investor-State Dispute Settlement (ISDS) provisions in the Canada-E.U. Comprehensive Economic and Trade Agreement (CETA), nor in the U.S.-E.U. Transatlantic Trade and Investment Partnership (TTIP).

The report which created the fuss does seem to be premature as the negotiations have not been completed; there is no final text.  How does a Trade and Investment Partnership work without Investor Protection?  The initial report was at least premature.  See here.

German officials claim to be “stunned” by the press report.  See here.  But the same article confirms Germany’s position that NAFTA-type ISDS among countries with sound legal systems is superfluous.

How serious is the problem?  Will it become an impasse?  This is not the first time Germany has publicly explained its position on ISDS.  See here and here.  But the 11th hour timing is quite troublesome and E.U. officials are reluctant to change what has been agreed.

The implications of rejecting ISDS are drastic and could lead to unravelling.  See my iPolitics.ca column here.

Germany has said it wants nothing to do with independent arbitral tribunals in either TTIP or CETA passing judgement on German laws.  Both CETA and TTIP are negotiations among equals with well developed legal systems.  Germany considers its courts are good enough.

Negotiations among so many different parties are bound to be difficult – and when so many of the parties are sovereign states, one understands the difficulties involved in herding cats.

The problems will not be over with the initialing of the final text.  The ratification process by all 28 E.U. member states will be a new ball game.

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