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Respondent details

  • Company/Organisation: Observatorio sobre la Protección Jurídica de Inversiones en el Exterior, Universidad Pontificia de Comillas (ICAI-ICADE), Madrid (Spain)
  • Location: Spain
  • Activity: Research in the field of protection of foreign investment in international law
  • Profile: Academic
  • Transparency register: No
  • Prior investment in the US: No


A. Substantive investment protection provisions

Explanation of the issue

The scope of the agreement responds to a key question: What type of investments and investors should be protected? Our response is that investment protection should apply to those investments and to investors that have made an investment in accordance with the laws of the country where they have invested.

Approach in most investment agreements

Many international investment agreements have broad provisions defining “investor” and “investment”.

In most cases, the definition of “investment” is intentionally broad, as investment is generally a complex operation that may involve a wide range of assets, such as land, buildings, machinery, equipment, intellectual property rights, contracts, licences, shares, bonds, and various financial instruments. At the same time, most bilateral investment agreements refer to “investments made in accordance with applicable law”. This reference has worked well and has allowed ISDS tribunals to refuse to grant investment protection to investors who have not respected the law of the host state when making the investment (for example, by structuring the investment in such a way as to circumvent clear prohibitions in the law of the host state, or by procuring an investment fraudulently or through bribery).

In many investment agreements, the definition of “investor” simply refers to natural and juridical persons of the other Party to the agreement, without further refinement. This has allowed in some cases so–called “shell” or “mailbox” companies, owned or controlled by nationals or companies not intended to be protected by the agreement and having no real business activities in the country concerned, to make use of an investment agreement to launch claims before an ISDS tribunal.

The EU's objectives and approach

The EU wants to avoid abuse. This is achieved primarily by improving the definition of “investor”, thus eliminating so –called “shell” or “mailbox” companies owned by nationals of third countries from the scope: in order to qualify as a legitimate investor of a Party, a juridical person must have substantial business activities in the territory of that Party.

At the same time, the EU wants to rely on past treaty practice with a proven track record. The reference to “investments made in accordance with the applicable law” is one such example. Another is the clarification that protection is only granted in situations where investors have already committed substantial resources in the host state - and not when they are simply at the stage where they are planning to do so.

Link to reference text

Taking into account the above explanation and the text provided in annex as a reference, what is your opinion of the objectives and approach taken in relation to the scope of the substantive investment protection provisions in TTIP?

Question 1 covers two different things that should be dealt with separately by the European Commission. a) Definition of ‘investment’ In most investment treaties the definition of ‘investment’ is broad enough to encompass as many investment situations as possible. Examples included in most investment treaties are not normally understood as exhaustive. Any limitation to the definition of ‘investment’ in the treaty may freeze the applicability of the TTIP only to existing kinds of investments, thus eliminating the possibility of being it applicable to any new investment formula that may arise in the future. That limitation would oblige the Parties to renegotiate the TTIP from time to time. To avoid tough renegotiations of the TTIP (and lengthy subsequent ratifications of the amended treaty), the Contributor considers that the European Commission should propose the widest definition of ‘investment’ that may be drafted, like the one developed in the draft EU-Canada agreement (CETA) and as commonly found in many BITs to which EU Member States are parties. Eligible investments should comply with the law of the host State, provided that the law at stake is not contrary to the TTIP itself or customary international law. b) Definition of ‘investor’ Om the one hand, the Contributor suggests that the notion of ‘investor’ encompasses any natural person who: - has the citizenship or nationality of one of the Parties; or, - permanently resides in the territory of one of the Parties. On the other hand, it has been widely accepted that investment protection shall be accorded to a foreign investor that is not a natural person (i.e., any kind of organization and/or enterprise) irrespective of the activities (if any) that such an investor carries out in the State under which it is organized and/or acts (home State). Organizations and/or enterprises organized and/or de facto functioning in accordance with the law of a Party are governed by that law and accordingly have obligations according to the same. They are not more (and not less) legitimate because of the substance and extent of activities they engage in their home State but because of their being subject to the law of that home State. In addition, there should not be any additional prerequisites to conduct ‘substantial business activities’ in order to enjoy investment protection. Foreign investment is mostly channeled nowadays through investment vehicles. Furthermore, arbitral tribunals have expressly endorsed so-called ‘shell’ or ‘mailbox’ companies as eligible investors able to pursue ISDS. In fact, many of those companies are incorporated in EU Member States like Cyprus, Luxembourg, the Netherlands and the United Kingdom. Consequently, the Contributor rejects the European Commission’s proposal to exclude ‘shell’ or ‘mailbox’ companies from TTIP protection. In the Contributor’s opinion, the European Commission should not forget that the problem is not ‘access to ISDS by certain investors’ but actually ‘the actions and omissions committed by State organs that amount to breaches of investment treaties’, notwithstanding the actual nationality of an investor. However, the idea transmitted by the European Commission seems to be that no legal consequences should arise against a Party for breaches of substantive provisions of the TTIP (i.e., international law) if the aggrieved investor is a ‘shell’ or ‘mailbox’ company.

Explanation of the issue

Under the standards of non-discriminatory treatment of investors, a state Party to the agreement commits itself to treat foreign investors from the other Party in the same way in which it treats its own investors (national treatment), as well in the same way in which it treats investors from other countries (most-favoured nation treatment). This ensures a level playing field between foreign investors and local investors or investors from other countries. For instance, if a certain chemical substance were to be proven to be toxic to health, and the state took a decision that it should be prohibited, the state should not impose this prohibition only on foreign companies, while allowing domestic ones to continue to produce and sell that substance.

Non-discrimination obligations may apply after the foreign investor has made the investment in accordance with the applicable law (post-establishment), but they may also apply to the conditions of access of that investor to the market of the host country (pre-establishment).  

Approach in most existing investment agreements

The standards of national treatment and most-favoured nation (MFN) treatment are considered to be key provisions of investment agreements and therefore they have been consistently included in such agreements, although with some variation in substance.

Regarding national treatment, many investment agreements do not allow states to discriminate between a domestic and a foreign investor once the latter is already established in a Party’s territory. Other agreements, however, allow such discrimination to take place in a limited number of sectors.

Regarding MFN, most investment agreements do not clarify whether foreign investors are entitled to take advantage of procedural or substantive provisions contained in other past or future agreements concluded by the host country. Thus, investors may be able to claim that they are entitled to benefit from any provision of another agreement that they consider to be more favourable, which may even permit the application of an entirely new standard of protection that was not found in the original agreement. In practice, this is commonly referred to as "importation of standards".

The EU’s objectives and approach

The EU considers that, as a matter of principle, established investors should not be discriminated against after they have established in the territory of the host country, while at the same recognises that in certain rare cases and in some very specific sectors, discrimination against already established investors may need to be envisaged. The situation is different with regard to the right of establishment, where the Parties may choose whether or not to open certain markets or sectors, as they see fit.

On the "importation of standards" issue, the EU seeks to clarify that MFN does not allow procedural or substantive provisions to be imported from other agreements.

The EU also includes exceptions allowing the Parties to take measures relating to the protection of health, the environment, consumers, etc. Additional carve-outs would apply to the audio-visual sector and the granting of subsidies. These are typically included in EU FTAs and also apply to the non-discrimination obligations relating to investment. Such exceptions allow differences in treatment between investors and investments where necessary to achieve public policy objectives.

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Taking into account the above explanations and the text provided in annex as a reference, what is your opinion of the EU approach to non –discrimination in relation to the TTIP? Please explain.

Question 2 covers two different standards of protection of foreign investments: a) National Treatment The Contributor considers that non-discrimination should be applied under the TTIP in all circumstances. No more comments are necessary on this topic. b) Most-favored-nation (MFN) clause In the Contributor’s opinion, the approach taken by the European Commission towards the MFN clause may jeopardize investment protection of international law. The Contributor is well aware of the debate about the application of MFN clauses to import procedural provisions from another investment treaty (the so-called Maffezini doctrine). However, the European Commission is proposing to reject the application of MFN clauses even to import substantial provisions from other BITs or investment chapters of free trade agreements. If the TTIP so provides, - MFN clauses would be rendered moot; and, - investors would be forced to structure their investments through States that have more protective BITs (treaty shopping). The Contributor considers it essential to include MFN protection over the substantive standards of the TTIP such as fair and equitable treatment, most constant protection and security, prohibition against (direct or indirect) expropriation, non-discrimination, unreasonable measures, etc. If the TTIP provides for ISDS (including investment arbitration), the MFN clause must also be construed as including the possibility of importing more favorable procedural requirements to pursue ISDS (including arbitration) provided for in other international investment treaties. In this regard, the European Commission may find it useful to follow Article 3(3) of the United Kingdom’s 2005 Model BIT: “For the avoidance of doubt, it is confirmed that the treatment provided for in paragraphs (1) and (2) above shall apply to the provisions of Articles 1 to 11 of this Agreement.”

Explanation of the issue

The obligation to grant foreign investors fair and equitable treatment (FET) is one of the key investment protection standards. It ensures that investors and investments are protected against treatment by the host country which, even if not expropriatory or discriminatory, is still unacceptable because it is arbitrary, unfair, abusive, etc. 

Approach in most investment agreements

The FET standard is present in most international investment agreements. However, in many cases the standard is not defined, and it is usually not limited or clarified. Inevitably, this has given arbitral tribunals significant room for interpretation, and the interpretations adopted by arbitral tribunals have varied from very narrow to very broad, leading to much controversy about the precise meaning of the standard. This lack of clarity has fueled a large number of ISDS claims by investors, some of which have raised concern with regard to the states' right to regulate. In particular, in some cases, the standard has been understood to encompass the protection of the legitimate expectations of investors in a very broad way, including the expectation of a stable general legislative framework.

Certain investment agreements have narrowed down the content of the FET standard by linking it to concepts that are considered to be part of customary international law, such as the minimum standard of treatment that countries must respect in relation to the treatment accorded to foreigners. However, this has also resulted in a wide range of differing arbitral tribunal decisions on what is or is not covered by customary international law, and has not brought the desired greater clarity to the definition of the standard. An issue sometimes linked to the FET standard is the respect by the host country of its legal obligations towards the foreign investors and their investments (sometimes referred to as an "umbrella clause"), e.g. when the host country has entered into a contract with the foreign investor. Investment agreements may have specific provisions to this effect, which have sometimes been interpreted broadly as implying that every breach of e.g. a contractual obligation could constitute a breach of the investment agreement.

EU objectives and approach

The main objective of the EU is to clarify the standard, in particular by incorporating key lessons learned from case-law. This would eliminate uncertainty for both states and investors.

Under this approach, a state could be held responsible for a breach of the fair and equitable treatment obligation only for breaches of a limited set of basic rights, namely: the denial of justice; the disregard of the fundamental principles of due process; manifest arbitrariness; targeted discrimination based on gender, race or religious belief; and abusive treatment, such as coercion, duress or harassment. This list may be extended only where the Parties (the EU and the US) specifically agree to add such elements to the content of the standard, for instance where there is evidence that new elements of the standard have emerged from international law.

The “legitimate expectations” of the investor may be taken into account in the interpretation of the standard. However, this is possible only where clear, specific representations have been made by a Party to the agreement in order to convince the investor to make or maintain the investment and upon which the investor relied, and that were subsequently not respected by that Party. The intention is to make it clear that an investor cannot legitimately expect that the general regulatory and legal regime will not change. Thus the EU intends to ensure that the standard is not understood to be a “stabilisation obligation”, in other words a guarantee that the legislation of the host state will not change in a way that might negatively affect investors. In line with the general objective of clarifying the content of the standard, the EU shall also strive, where necessary, to provide protection to foreign investors in situations in which the host state uses its sovereign powers to avoid contractual obligations towards foreign investors or their investments, without however covering ordinary contractual breaches like the non-payment of an invoice.

Link to reference text

Taking into account the above explanation and the text provided in annex as a reference, what is your opinion of the approach to fair and equitable treatment of investors and their investments in relation to the TTIP?

The European Commission’s proposal on fair and equitable treatment (hereinafter, “FET”) would limit protection to foreign investors only to some of the most outrageous breaches of investment treaties such as denial of justice, the disregard of the fundamental principles of due process, manifest arbitrariness, targeted discrimination based on gender, race or religious belief, and abusive treatment, such as coercion, duress or harassment. Such a departure from the generally established wider protection under this standard in international investment law should be avoided. It may be regarded a step backwards, to Neer. However, the current development of international law (applicable to the European Union, its Member States and the United States of America) shows that the threshold for holding a State liable for a breach of an investment (or human rights) treaty is substantially lower than that which the European Commission is now pursuing under this Consultation. This is one of the “key lessons learned from case-law,” in the words of the European Commission in the Consultation: there is evidence that new elements of the FET standard have emerged from international law that justify additional protection to investors. In addition, the European Commission’s proposal also waters down the ‘legitimate expectations’ component of the FET standard to the effect that foreign investors would eventually be under-protected in cases of regulatory opportunism. The FET standard and the so-called ‘umbrella clause’ should encompass situations where general representations were made by the disputing Party, not necessarily directed specifically to one particular investor but to a generality of investors –including foreign investors–, and the Party later on engages in conduct that frustrates the legitimate expectations relating to the investments made in reliance on those representations.

Explanation of the issue

The right to property is a human right, enshrined in the European Convention of Human Rights, in the European Charter of Fundamental Rights as well as in the legal tradition of EU Member States. This right is crucial to investors and investments. Indeed, the greatest risk that investors may incur in a foreign country is the risk of having their investment expropriated without compensation. This is why the guarantees against expropriation are placed at the core of any international investment agreement.

Direct expropriations, which entail the outright seizure of a property right, do not occur often nowadays and usually do not generate controversy in arbitral practice. However, arbitral tribunals are confronted with a much more difficult task when it comes to assessing whether a regulatory measure of a state, which does not entail the direct transfer of the property right, might be considered equivalent to expropriation (indirect expropriation).

Approach in most investment agreements

In investment agreements, expropriations are permitted if they are for a public purpose, non-discriminatory, resulting from the due process of law and are accompanied by prompt and effective compensation. This applies to both direct expropriation (such as nationalisation) and indirect expropriation (a measure having an effect equivalent to expropriation).

Indirect expropriation has been a source of concern in certain cases where regulatory measures taken for legitimate purposes have been subject to investor claims for compensation, on the grounds that such measures were equivalent to expropriation because of their significant negative impact on investment. Most investment agreements do not provide details or guidance in this respect, which has inevitably left arbitral tribunals with significant room for interpretation.

The EU's objectives and approach

The objective of the EU is to clarify the provisions on expropriation and to provide interpretative guidance with regard to indirect expropriation in order to avoid claims against legitimate public policy measures.  The EU wants to make it clear that non-discriminatory measures taken for legitimate public purposes, such as to protect health or the environment, cannot be considered equivalent to an expropriation, unless they are manifestly excessive in light of their purpose. The EU also wants to clarify that the simple fact that a measure has an impact on the economic value of the investment does not justify a claim that an indirect expropriation has occurred.

Link to reference text

Taking into account the above explanation and the text provided in annex as a reference, what is your opinion of the approach to dealing with expropriation in relation to the TTIP? Please explain.

The Contributor considers it necessary, for the purposes of addressing Question 4, to distinguish between direct and indirect expropriation. a) Direct expropriation The Contributor recalls that direct expropriations of investments of foreign investors still occur today, even in EU Member States. The European Commission should not reject this argument so loosely. b) Indirect expropriation The EU’s proposal that non-discriminatory measures purportedly seeking to protect the public interest must not be considered (unlawful) indirect expropriations is excessively wide. In addition, such proposal would leave investors unprotected by de facto exempting States of responsibility in cases of blatant ‘takings’. This could ultimately lead to regulatory opportunism. Any non-discriminatory measure(s) that so negatively (and, hence, severely) affect(s) an investment as to substantially deprive the investor of the use, enjoyment, benefit and/or disposal of their investment should be considered in any event an (unlawful) indirect expropriation, entitling the investor to prompt, adequate and effective compensation. It must be recalled that the public interest is already embedded within the requirements for a lawful expropriation. As a result, the Contributor rejects the European Commission’s plan to include paragraph 3 of the Annex: Expropriation of the draft EU-Canada agreement (CETA). Furthermore, the Contributor wishes to recall that the factors mentioned in paragraph 2 of the Annex: Expropriation of the draft EU-Canada agreement (CETA) cannot be considered ‘requirements’ for a finding that an indirect expropriation exists. In the field of investment protection, an indirect expropriation exists whenever the effect of the challenged measure(s) is to substantially deprive the investor of its right to commercially enjoy its investment. Therefore, by way of example, an indirect expropriation exists irrespective of the intent of the challenged measure(s). The Contributor suggests that the TTIP includes a statement providing that “Article (…) on Expropriation is intended to reflect customary international law concerning the obligations of States with respect to expropriation,” as included in paragraph 1 of Annex B (“Expropriation”) of the (2012) US Model BIT. The interest rate to be added to compensation should not be referred to ‘a normal commercial rate’, as indicated in Article X(3) of the draft EU-Canada agreement (CETA). It should rather depend on the circumstances of the case – in some circumstances, the specific characteristics of the investor, the investment and/or the contract should be taken into account. Additionally, the interest rate must always be higher than that with which the State is trading its debt in capital markets. The Contributor considers that this approach would better comply with the requirement of full reparation of damages that general international law has set out as the consequence of an internationally wrongful act.

Explanation of the issue

In democratic societies, the right to regulate of states is subject to principles and rules contained in both domestic legislation and in international law. For instance, in the European Convention on Human Rights, the Contracting States commit themselves to guarantee a number of civil and political rights. In the EU, the Constitutions of the Member States, as well as EU law, ensure that the actions of the state cannot go against fundamental rights of the citizens. Hence, public regulation must be based on a legitimate purpose and be necessary in a democratic society.

Investment agreements reflect this perspective. Nevertheless, wherever such agreements contain provisions that appear to be very broad or ambiguous, there is always a risk that the arbitral tribunals interpret them in a manner which may be perceived as a threat to the state's right to regulate. In the end, the decisions of arbitral tribunals are only as good as the provisions that they have to interpret and apply.

 Approach in most investment agreements

Most agreements that are focused on investment protection are silent about how public policy issues, such as public health, environmental protection, consumer protection or prudential regulation, might interact with investment. Consequently, the relationship between the protection of investments and the right to regulate in such areas, as envisaged by the contracting Parties to such agreements is not clear and this creates uncertainty.

In more recent agreements, however, this concern is increasingly addressed through, on the one hand, clarification of the key investment protection provisions that have proved to be controversial in the past and, on the other hand, carefully drafted exceptions to certain commitments. In complex agreements such as free trade agreements with provisions on investment, or regional integration agreements, the inclusion of such safeguards is the usual practice.

The EU's objectives and approach

The objective of the EU is to achieve a solid balance between the protection of investors and the Parties' right to regulate.

First of all, the EU wants to make sure that the Parties' right to regulate is confirmed as a basic underlying principle. This is important, as arbitral tribunals will have to take this principle into account when assessing any dispute settlement case.

Secondly, the EU will introduce clear and innovative provisions with regard to investment protection standards that have raised concern in the past (for instance, the standard of fair and equitable treatment is defined based on a closed list of basic rights; the annex on expropriation clarifies that non-discriminatory measures for legitimate public policy objectives do not constitute indirect expropriation). These improvements will ensure that investment protection standards cannot be interpreted by arbitral tribunals in a way that is detrimental to the right to regulate.

Third, the EU will ensure that all the necessary safeguards and exceptions are in place. For instance, foreign investors should be able to establish in the EU only under the terms and conditions defined by the EU. A list of horizontal exceptions will apply to non-discrimination obligations, in relation to measures such as those taken in the field of environmental protection, consumer protection or health (see question 2 for details). Additional carve-outs would apply to the audiovisual sector and the granting of subsidies. Decisions on competition matters will not be subject to investor-to-state dispute settlement (ISDS). Furthermore, in line with other EU agreements, nothing in the agreement would prevent a Party from taking measures for prudential reasons, including measures for the protection of depositors or measures to ensure the integrity and stability of its financial system. In addition, EU agreements contain general exceptions applying in situations of crisis, such as in circumstances of serious difficulties for the operation of the exchange rate policy or monetary policy, balance of payments or external financial difficulties, or threat thereof.

In terms of the procedural aspects relating to ISDS, the objective of the EU is to build a system capable of adapting to the states' right to regulate. Wherever greater clarity and precision proves necessary in order to protect the right to regulate, the Parties will have the possibility to adopt interpretations of the investment protection provisions which will be binding on arbitral tribunals.  This will allow the Parties to oversee how the agreement is interpreted in practice and, where necessary, to influence the interpretation.

The procedural improvements proposed by the EU will also make it clear that an arbitral tribunal will not be able to order the repeal of a measure, but only compensation for the investor.

Furthermore, frivolous claims will be prevented and investors who bring claims unsuccessfully will pay the costs of the government concerned (see question 9).

Link to reference text

Taking into account the above explanation and the text provided in annex as a reference, what is your opinion with regard to the way the right to regulate is dealt with in the EU's approach to TTIP?

The Contributor acknowledges that States have a right to regulate and it may be taken into account by arbitral tribunals. However, that right is not unlimited and may prompt the State’s responsibility in cases in which the new regulation causes an excessive burden on investors. The latter is the application of the principle of proportionality as developed by the jurisprudence of the European Court of Human Rights. The Contributor recalls that on most occasions investors disputing a measure taken by a State do not request the repeal of that measure (restitution) but payment of compensation, both being available types of reparation in international law. The reason is that the investor usually loses confidence in the host State after the passing of the disputed measure. The consequence is that it will divest from that State and will only claim for compensation. As a result, the European Commission’s proposal is not new at all. Nonetheless, in certain circumstances the repeal of the measure may be positive, so the European Commission should not push for restricting arbitral tribunals’ powers in this regard. Finally, Question 5 deals with topics also addressed by the European Commission under other questions. The Contributor hereby refers to Answers to: - Question 3, with regard to limitations to the fair and equitable treatment standard; - Question 4, on indirect expropriation. - Question 9, on frivolous claims and payment of costs. - Question 10, on filters to claims on prudential measures for the financial sector; and, - Question 11, on the interpretation of the TTIP.

B. Investor-to-State dispute settlement (ISDS)

Explanation of the issue

In most ISDS cases, no or little information is made available to the public, hearings are not open and third parties are not allowed to intervene in the proceedings. This makes it difficult for the public to know the basic facts and to evaluate the claims being brought by either side.

This lack of openness has given rise to concern and confusion with regard to the causes and potential outcomes of ISDS disputes. Transparency is essential to ensure the legitimacy and accountability of the system. It enables stakeholders interested in a dispute to be informed and contribute to the proceedings. It fosters accountability in arbitrators, as their decisions are open to scrutiny. It contributes to consistency and predictability as it helps create a body of cases and information that can be relied on by investors, stakeholders, states and ISDS tribunals.

Approach in most existing investment agreements

Under the rules that apply in most existing agreements, both the responding state and the investor need to agree to permit the publication of submissions. If either the investor or the responding state does not agree to publication, documents cannot be made public. As a result, most ISDS cases take place behind closed doors and no or a limited number of documents are made available to the public.

The EU’s objectives and approach 

The EU's aim is to ensure transparency and openness in the ISDS system under TTIP. The EU will include provisions to guarantee that hearings are open and that all documents are available to the public. In ISDS cases brought under TTIP, all documents will be publicly available (subject only to the protection of confidential information and business secrets) and hearings will be open to the public. Interested parties from civil society will be able to file submissions to make their views and arguments known to the ISDS tribunal. 

The EU took a leading role in establishing new United Nations rules on transparency[1] in ISDS. The objective of transparency will be achieved by incorporating these rules into TTIP.

Link to reference text

Taking into account the above explanation and the text provided in annex as a reference, please provide your views on whether this approach contributes to the objective of the EU to increase transparency and openness in the ISDS system for TTIP. Please indicate any additional suggestions you may have.

The Contributor agrees to the application of the UNCITRAL Rules on Transparency in Treaty-based Investor-State Arbitration to ISDS proceedings under the TTIP. However, transparency should not be understood in a way that allows third parties to play a decisive role on the adjudication of the dispute. The European Commission should take into account the functioning of other international proceedings in which the actions and omissions of a State are examined by an international tribunal or court, such as those of the Court of Justice of the European Union or the European Court of Human Rights. In those cases, although there is currently a lot of transparency (between the filing of the claim against the State until the rendering of the final judgment), the disputing parties do not usually face a heavy burden due to compliance with transparency prerequisites. The European Commission should not forget that the primary aim of ISDS is to solve an existing dispute between two parties. Transparency in ISDS must not undermine the disputing parties’ rights to present their case before the arbitral tribunal and to be heard in a fair and equal manner, nor should transparency be used by third parties to jeopardize the system or the parties’ legitimate rights referred to above. In this regard, the Contributor would like to submit the following reflections: - Access to documents of the dispute must be weighed against the protection of confidential information. Confidentiality is more important for investors as private parties than for respondent States, which in general are subject to transparency requirements in dealing with public affairs. - Respondent States should not be allowed not to disclose documents when requested by the investor or the arbitral tribunal, particularly in cases of regulatory decisions. - The submission of amicus briefs by non-disputing parties must not alter the normal conduct of the proceedings; nor should it unfairly delay the final adjudication of the dispute. - Attendance by non-disputing parties to the hearings must not prevent the parties’ counsel from doing their job properly. The Contributor would also like to recall that in many cases the respondent States are not interested in transparency in ISDS proceedings so as to avoid their actions and omissions towards investors’ investments being scrutinized or assessed by the general public (i.e., taxpayers/voters).

Explanation of the issue

Investors who consider that they have grounds to complain about action taken by the authorities (e.g. discrimination or lack of compensation after expropriation) often have different options. They may be able to go to domestic courts and seek redress there. They or any related companies may be able to go to other international tribunals under other international investment treaties.

It is often the case that protection offered in investment agreements cannot be invoked before domestic courts and the applicable legal rules are different. For example, discrimination in favour of local companies is not prohibited under US law but is prohibited in investment agreements. There are also concerns that, in some cases domestic courts may favour the local government over the foreign investor e.g. when assessing a claim for compensation for expropriation or may deny due process rights such as the effective possibility to appeal. Governments may have immunity from being sued. In addition, the remedies are often different. In some cases government measures can be reversed by domestic courts, for example if they are illegal or unconstitutional. ISDS tribunals cannot order governments to reverse measures.

These different possibilities raise important and complex issues. It is important to make sure that a government does not pay more than the correct compensation. It is also important to ensure consistency between rulings.

Approach in most existing investment agreements

Existing investment agreements generally do not regulate or address the relationship with domestic courts or other ISDS tribunals. Some agreements require that the investor choses between domestic courts and ISDS tribunals. This is often referred to as "fork in the road" clause.

The EU’s objectives and approach

As a matter of principle, the EU’s approach favours domestic courts. The EU aims to provide incentives for investors to pursue claims in domestic courts or to seek amicable solutions – such as mediation. The EU will suggest different instruments to do this. One is to prolong the relevant time limits if an investor goes to domestic courts or mediation on the same matter, so as not to discourage an investor from pursuing these avenues.  Another important element is to make sure that investors cannot bring claims on the same matter at the same time in front of an ISDS tribunal and domestic courts. The EU will also ensure that companies affiliated with the investor cannot bring claims in front of an ISDS tribunal and domestic courts on the same matter and at the same time. If there are other relevant or related cases, ISDS tribunals must take these into account. This is done to avoid any risk that the investor is over-compensated and helps to ensure consistency by excluding the possibility for parallel claims.

Link to reference text

Taking into account the above explanation and the text provided in annex as a reference, please provide your views on the effectiveness of this approach for balancing access to ISDS with possible recourse to domestic courts and for avoiding conflicts between domestic remedies and ISDS in relation to the TTIP. Please indicate any further steps that can be taken. Please provide comments on the usefulness of mediation as a means to settle disputes.

Question 7 again poses different topics that must be dealt with separately: a) Recourse to domestic courts Foreign investors have always been very reluctant to resort to the domestic courts of the host State to have their investment disputes adjudicated, as the former consider that those courts may likely be influenced by the respondent State, even showing hostility towards foreigners. As a result, the Contributor considers that the European Commission will not easily convince foreign investors to submit their investment claims mainly to the courts of justice of the respondent State, even in the context of the TTIP. b) Multiple claims The Contributor does not agree with the European Commission’s proposal that affiliates with the claiming investor may not pursue ISDS proceedings on their own. On the contrary, it may happen that their affiliates have individualized claims against the respondent State which could be different to and independent from those of their parent company and that could even benefit shareholders other than their parent company. As a result, the European Commission should pursue the protection of any company that might have been affected by the actions and omissions of the host State. The Contributor understands that, if there is any risk of overlapping compensation, subsequent tribunals will no doubt take into account the outcome of any initial arbitration proceeding, as acknowledged in case law, if circumstances so require. The Contributor considers that it is not necessary for an arbitral tribunal under the TTIP to “stay its proceedings”, as indicated in article x-23 of the EU-Canada agreement (CETA) in case of multiple claims. On the contrary, it would be enough for the arbitral tribunal to “ensure that proceedings pursuant to another international agreement are taken into account in its decision, order or award”, for example reducing compensation by an amount proportional to that granted in any previous award, to avoid double recovery of damages. c) Mediation as a means to settle investor-State disputes The Contributor agrees that mediation may serve as a means to settle investor-State disputes. It may be so during either the cooling-off period triggered by the request for consultations or even the pendency of the arbitration proceedings. However, recourse to mediation must be optional for the disputing parties. If mediation is set out as a compulsory prerequisite to allow an investor to later resort to investment arbitration, mediation will likely fail.

Explanation of the issue

There is concern that arbitrators on ISDS tribunals do not always act in an independent and impartial manner. Because the individuals in question may not only act as arbitrators, but also as lawyers for companies or governments, concerns have been expressed as to potential bias or conflicts of interest.

Some have also expressed concerns about the qualifications of arbitrators and that they may not have the necessary qualifications on matters of public interest or on matters that require a balancing between investment protection and e.g. environment, health or consumer protection.

Approach in existing investment agreements

  Most existing investment agreements do not address the issue of the conduct or behaviour of arbitrators. International rules on arbitration address the issue by allowing the responding government or the investor to challenge the choice of arbitrator because of concerns of suitability.

Most agreements allow the investor and the responding state to select arbitrators but do not establish rules on the qualifications or a list of approved, qualified arbitrators to draw from.

  The EU’s objective and approach

The EU aims to establish clear rules to ensure that arbitrators are independent and act ethically. The EU will introduce specific requirements in the TTIP on the ethical conduct of arbitrators, including a code of conduct. This code of conduct will be binding on arbitrators in ISDS tribunals set up under TTIP.  The code of conduct also establishes procedures to identify and deal with any conflicts of interest.  Failure to abide by these ethical rules will result in the removal of the arbitrator from the tribunal. For example, if a responding state considers that the arbitrator chosen by the investor does not have the necessary qualifications or that he has a conflict of interest, the responding state can challenge the appointment. If the arbitrator is in breach of the Code of Conduct, he/she will be removed from the tribunal. In case the ISDS tribunal has already rendered its award and a breach of the code of conduct is found, the responding state or the investor can request a reversal of that ISDS finding.

In the text provided as reference (the draft EU-Canada Agreement), the Parties (i.e. the EU and Canada) have agreed for the first time in an investment agreement to include rules on the conduct of arbitrators, and have included the possibility to improve them further if necessary. In the context of TTIP these would be directly included in the agreement.

As regards the qualifications of ISDS arbitrators, the EU aims to set down detailed requirements for the arbitrators who act in ISDS tribunals under TTIP. They must be independent and impartial, with expertise in international law and international investment law and, if possible, experience in international trade law and international dispute resolution. Among those best qualified and who have undertaken such tasks will be retired judges, who generally have experience in ruling on issues that touch upon both trade and investment and on societal and public policy issues. The EU also aims to set up a roster, i.e. a list of qualified individuals from which the Chairperson for the ISDS tribunal is drawn, if the investor or the responding state cannot otherwise agree to a Chairperson. The purpose of such a roster is to ensure that the EU and the US have agreed to and vetted the arbitrators to ensure their abilities and independence.  In this way the responding state chooses one arbitrator and has vetted the third arbitrator.

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Taking into account the above explanation and the text provided in annex as a reference, please provide your views on these procedures and in particular on the Code of Conduct and the requirements for the qualifications for arbitrators in relation to the TTIP agreement. Do they improve the existing system and can further improvements be envisaged?

Question 8 deals with very sensitive questions that must be dealt with separately. a) Arbitrator ethics The Contributor wishes to recall that it has been standard practice that counsel and advocates to parties at the International Court of Justice also serve as judges ad hoc in other proceedings at the same court. In fact, rules on service as arbitrators or counsel before arbitral tribunals are stricter (for example, at the Court of Arbitration for Sport/Tribunal Arbitral du Sport) than before international permanent courts. b) Code of conduct The international arbitral community has already created standard codes of conduct for international arbitrators that are applied on a regular basis. In fact, article X-25(6) of the draft EU-Canada agreement (CETA) affirms that arbitrators under that treaty “shall comply with” the IBA Guidelines on Conflicts of Interest in International Arbitration of May 22, 2004. The Contributor considers that no new code of conduct for arbitrators is necessary. In fact, article X-42 of the draft EU-Canada agreement (CETA) indicates that the Committee created pursuant to that treaty will decide to adopt a code of conduct that may address topics including disclosure obligations, the independence and impartiality of arbitrators and confidentiality. Those topics are already dealt with by existing codes of conduct, particularly the IBA Guidelines referred to above. What matters now is to apply those existing codes to investment disputes under the TTIP. c) Qualifications of arbitrators The Contributor rejects the idea that retired domestic judges are suitable candidates to include in the proposed List of Arbitrators. On the one hand, they may be perceived as biased towards respondent States. They would not then necessarily meet the requirements set out in article X-25(6) of the draft EU-Canada agreement (CETA) with regard to “independence and impartiality”. On the other hand, they may lack qualifications to serve as arbitrators in ISDS as, at least in Spain, judges do not usually apply international law (whether treaties, customs or general principles of law) in the adjudication of disputes; nor are they frequently familiar with international treaties and case law of international courts and tribunals. They would not then necessarily meet the requirements set out in article X-25(5) of the draft EU-Canada agreement (CETA) with regard to “expertise or experience in public international law”.

Explanation of the issue

As in all legal systems, cases are brought that have little or no chance of succeeding (so-called “frivolous claims”). Despite eventually being rejected by the tribunals, such cases take up time and money for the responding state. There have been concerns that protracted and frequent litigation in ISDS could have an effect on the policy choices made by states. This is why it is important to ensure that there are mechanisms in place to weed out frivolous disputes as early as possible.

Another issue is the cost of ISDS proceedings. In many ISDS cases, even if the responding state is successful in defending its measures in front of the ISDS tribunal, it may have to pay substantial amounts to cover its own defence.

Approach in most existing investment agreements:

Under existing investment agreements, there are generally no rules dealing with frivolous claims. Some arbitration rules however do have provisions on frivolous claims. As a result, there is a risk that frivolous or clearly unfounded claims are allowed to proceed. Even though the investor would lose such claims, the long proceedings and the implied questions surrounding policy can be problematic.

The issue of who bears the cost is also not addressed in most existing investment agreements. Some international arbitration rules have provisions that address the issue of costs in very general terms. In practice, ISDS tribunals have often decided that the investor and responding state pay their own legal costs, regardless of who wins or loses.

The EU’s objectives and approach

The EU will introduce several instruments in TTIP to quickly dismiss frivolous claims.

ISDS tribunals will be required to dismiss claims that are obviously without legal merit or legally unfounded. For example, this would be cases where the investor is not established in the US or the EU, or cases where the ISDS tribunal can quickly establish that there is in fact no discrimination between domestic and foreign investors. This provides an early and effective filtering mechanism for frivolous claims thereby avoiding a lengthy litigation process.

To further discourage unfounded claims, the EU is proposing that the losing party should bear all costs of the proceedings. So if investors take a chance at bringing certain claims and fail, they have to pay the full financial costs of this attempt.

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Taking into account the above explanation and the text provided in annex as a reference, please provide your views on these mechanisms for the avoidance of frivolous or unfounded claims and the removal of incentives in relation to the TTIP agreement. Please also indicate any other means to limit frivolous or unfounded claims.

Question 9 poses three interrelated topics that nonetheless should be dealt with separately. a) Claims manifestly without legal merit The Contributors understand that proposed article X-29 of the draft EU-Canada agreement (CETA), as extended to the TTIP, develops existing Rule 41(5) of ICSID Arbitration Rules (which was approved in April 2006). The aim of that provision would be to allow non-ICSID arbitral tribunals to have recourse to a procedure for a fast-track dismissal of a claim “manifestly without legal merit.” The Contributor considers that there should be no presumption that once the respondent State has invoked the application of article X-29 the arbitral tribunal should in any event dismiss the claim as frivolous or unfounded. Case law proves that arbitral tribunals have rejected dismissing cases under Rule 41(5) requests either entirely or partially, thus allowing the non-requesting party to present its case in a comprehensive manner in a subsequent phase of the proceeding. b) Claims unfounded as a matter of law The Contributor considers that proposed article X-30 of the draft EU-Canada agreement (CETA), as extended to the TTIP, is very similar to article X-29. The Contributor considers it unnecessary. c) Costs of the arbitration proceeding The Contributor recalls that arbitral tribunals take their decisions on costs by relying not only on the outcome of the case (jurisdiction and/or merits), but also on the way in which the parties behaved during the proceedings. As a result, the Contributor does not agree that arbitrators rule on the costs of the proceedings under the principle ‘cost follow the event’ mandatorily, as provided for in article x-36 of the draft EU-Canada agreement (CETA). On the contrary, the Contributor proposes that the general rule be that the arbitrators be free to adjudicate on costs according to their own, independent assessment of the circumstances of the case. In this regard, the Contributor highlights that current draft article x-36 of the draft EU-Canada agreement (CETA) allows arbitral tribunals to deviate from the ‘cost follow the event’ rule if they determine “that apportionment [of costs] is appropriate in the circumstances of the claim.” d) General comment To strike a balance between investors and States, it would be fair for the European Commission to set up a fast-track procedure to adjudicate claims submitted by investors which are manifestly with legal merit, such as in cases of direct expropriations without payment of compensation.

Explanation of the issue

Recently, concerns have been expressed in relation to several ISDS claims brought by investors under existing investment agreements, relating to measures taken by states affecting the financial sector, notably those taken in times of crisis in order to protect consumers or to maintain the stability and integrity of the financial system.

To address these concerns, some investment agreements have introduced mechanisms which grant the regulators of the Parties to the agreement the possibility to intervene (through a so-called “filter” to ISDS) in particular ISDS cases that involve measures ostensibly taken for prudential reasons. The mechanism enables the Parties to decide whether a measure is indeed taken for prudential reasons, and thus if the impact on the investor concerned is justified. On this basis, the Parties may therefore agree that a claim should not proceed.

Approach in most existing investment agreements

The majority of existing investment agreements privilege the original intention of such agreements, which was to avoid the politicisation of disputes, and therefore do not contain provisions or mechanisms which allow the Parties the possibility to intervene under particular circumstances in ISDS cases.

The EU’s objectives and approach

The EU like many other states considers it important to protect the right to regulate in the financial sector and, more broadly, the overriding need to maintain the overall stability and integrity of the financial system, while also recognizing the speed needed for government action in case of financial crisis.

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Some investment agreements include filter mechanisms whereby the Parties to the agreement (here the EU and the US) may intervene in ISDS cases where an investor seeks to challenge measures adopted pursuant to prudential rules for financial stability. In such cases the Parties may decide jointly that a claim should not proceed any further. Taking into account the above explanation and the text provided in annex as a reference, what are your views on the use and scope of such filter mechanisms in the TTIP agreement?

The Contributor is manifestly against this filter. The European Commission has suggested following the text developed in the draft EU-Canada agreement (CETA). The Contributor rejects the idea that the compatibility of the measures taken by the respondent State with the TTIP be adjudicated by the Financial Services Committee or the equivalent to the CETA Trade Committee under Article 15(1) (Prudential Carve-Out/Exceptions), rather than by the arbitral tribunal. On the one hand, the Financial Services Committee or the equivalent to the CETA Trade Committee would lack sufficient independence from the respondent State. The latter would most probably try to influence any of them improperly, aggravating the pain of the aggrieved investor. On the other hand, it is important to note that regulatory measures must also be passed according to administrative due process. Let’s take the following example:  The Financial Services Committee may decide that the disputed measure is justified by the Article 15.1 defense.  According to point 4 of the text developed in the draft EU-Canada agreement (CETA), if it is a valid defense of all parts of the claim in their entirety, “the investor shall be deemed to have withdrawn its claim and proceedings shall be discontinued in accordance with Article X-32,” while if it is a valid defense of only parts of the claim, the determination “shall be binding on the Tribunal with respect to those parts of the claim.”  The problem is that the powers of the arbitral tribunal would be superseded by those of the Financial Services Committee, to determine whether the way in which the measure was taken by the State nonetheless constituted a breach of the TTIP for breach of due process (under the fair and equitable treatment standard), which would in any case oblige the State to repair damage caused to the aggrieved investor. Finally, the Contributor recalls that in recent years the European Court of Human Rights has followed a procedural practice to avoid the analysis of certain measures taken by States in the context of financial crises. Following the entry into force of Protocol No. 14 in 2010, and relying on previous jurisprudence on the ‘wide margin of appreciation’ the States enjoy in dealing with public policy objectives, the Court has dismissed many claims on a fast-track basis as “inadmissible”, undermining the rights of individuals who complained and seized the Court with legitimate claims against European States. The European Commission should not endorse that path in the TTIP.

Explanation of the Issue

When countries negotiate an agreement, they have a common understanding of what they want the agreement to mean. However, there is a risk that any tribunal, including ISDS tribunals interprets the agreement in a different way, upsetting the balance that the countries in question had achieved in negotiations – for example, between investment protection and the right to regulate. This is the case if the agreement leaves room for interpretation. It is therefore necessary to have mechanisms which will allow the Parties (the EU and the US) to clarify their intentions on how the agreement should be interpreted.

Approach in existing investment agreements

Most existing investment agreements do not permit the countries who signed the agreement in question to take part in proceedings nor to give directions to the ISDS tribunal on issues of interpretation.

The EU’s objectives and approach 

The EU will make it possible for the non-disputing Party (i.e. the EU or the US) to intervene in ISDS proceedings between an investor and the other Party. This means that in each case, the Parties can explain to the arbitrators and to the Appellate Body how they would want the relevant provisions to be interpreted.  Where both Parties agree on the interpretation, such interpretation is a very powerful statement, which ISDS tribunals would have to respect.

The EU would also provide for the Parties (i.e. the EU and the US) to adopt binding interpretations on issues of law, so as to correct or avoid interpretations by tribunals which might be considered to be against the common intentions of the EU and the US. Given the EU’s intention to give clarity and precision to the investment protection obligations of the agreement, the scope for undesirable interpretations by ISDS tribunals is very limited. However, this provision is an additional safety-valve for the Parties.

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Taking into account the above explanation and the text provided in annex as a reference, please provide your views on this approach to ensure uniformity and predictability in the interpretation of the agreement to correct the balance? Are these elements desirable, and if so, do you consider them to be sufficient?

Question 11 again encompasses two different things that should not be confused. a) Interpretation of the TTIP by agreement of the Parties The inclusion of mechanisms to assist arbitral tribunals in the interpretation of the true meaning of the TTIP provisions is positive. The TTIP as an international treaty would be subject to the rules of interpretation that were codified in the Vienna Convention on the Law of Treaties of May 23, 1969. In fact, Article 31(3)(a) of the Vienna Convention expressly provides for the purposes of interpreting an international treaty that “There shall be taken into account, together with the context: (a) Any subsequent agreement between the parties regarding the interpretation of the treaty or the application of its provisions.” However, any interpretation by the Parties must be made “in good faith”, as indicated in Article 31(1) of the Vienna Convention, avoiding opportunistic situations against the protection of foreign investors such as: - The agreement reached by Spain and Chile regarding the interpretation of their BIT during the pendency of the arbitration proceeding in Víctor Pey Casado and Fundación Presidente Allende v. Chile, which was openly disregarded by the arbitral tribunal; or, - The Notes of Interpretation of Certain Chapter Eleven Provisions adopted by the Free Trade Commission of the North America Free Trade Agreement (NAFTA) on July 31, 2001, which were ultimately applied retroactively to pending cases. The Contributor considers that Parties to the TTIP should not exercise too much control over the arbitral proceedings through the issuance of binding interpretations of the treaty, as they would be undermining the independence of the arbitral tribunal in charge of adjudicating the dispute. The Contributor recalls that Parties to the TTIP would not need to issue notes of interpretation of the treaty should the travaux préparatoires of the TTIP, as supplementary means of interpretation of treaties pursuant to Article 32 of the Vienna Convention, be publicly available for being consulted by any interested person, including claiming investors and arbitral tribunals. Finally, the Contributor recalls that any legal text is subject to interpretation. The European Commission’s argument that “This is the case if the agreement leaves room for interpretation” is contrary to the reality of legal practice around the world. b) Intervention by a non-disputing Party The principle of intervention by a non-disputing Party to the treaty at stake has a long tradition in international law (for example, in Article 62 of the Statute of the Permanent Court of International Justice, later reproduced in Article 62 of the Statute of the International Court of Justice). In recent times, intervention of non-disputing Parties has been expressly acknowledged in Article 5 of the UNCITRAL Rules on Transparency in Treaty-based Investor-State Arbitration. The inclusion of the principle of intervention in the TTIP is in line with international practice, but should be exercised by the non-disputing Party with care and, in any event, in good faith. Articles 5(3) to 5(5) of the UNCITRAL Rules on Transparency may provide guidance for the implementation of a request for intervention by a non-disputing Party to the TTIP, in particular - that the arbitral tribunal shall ensure that any submission does not disrupt or unduly burden the arbitral proceedings, or unfairly prejudice any disputing party (Article 5(4)); and, - that the arbitral tribunal shall ensure that the disputing parties are given a reasonable opportunity to present their observations on any submission by a non-disputing Party to the treaty (Article 5(5)).

Explanation of the issue

In existing investment agreements, the decision by an ISDS tribunal is final. There is no possibility for the responding state, for example, to appeal to a higher instance to challenge the level of compensation or other aspects of the ISDS decision except on very limited procedural grounds. There are concerns that this can lead to different or even contradictory interpretations of the provisions of international investment agreements. There have been calls by stakeholders for a mechanism to allow for appeal to increase legitimacy of the system and to ensure uniformity of interpretation.


Approach in most existing investment agreements

No existing international investment agreements provide for an appeal on legal issues. International arbitration rules allow for annulment of ISDS rulings under certain very restrictive conditions relating to procedural issues. 

The EU’s objectives and approach 

The EU aims to establish an appellate mechanism in TTIP so as to allow for review of ISDS rulings. It will help ensure consistency in the interpretation of TTIP and provide both the government and the investor with the opportunity to appeal against awards and to correct errors. This legal review is an additional check on the work of the arbitrators who have examined the case in the first place.

In agreements under negotiation by the EU, the possibility of creating an appellate mechanism in the future is envisaged. However, in TTIP the EU intends to go further and create a bilateral appellate mechanism immediately through the agreement.

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Question 12. Taking into account the above explanation and the text provided in annex as a reference, please provide your views on the creation of an appellate mechanism in TTIP as a means to ensure uniformity and predictability in the interpretation of the agreement.

The Contributor would like to clarify at the outset that ISDS mechanisms put the claiming investor and the responding State on an equal footing throughout the proceeding. As a result, and contrary to the reflection made by the European Commission in the Consultation document (“there is no possibility for the responding state, for example, to appeal to a higher instance to challenge the level of compensation…”), a potential appellate mechanism must be seen, in case it is finally included in the TTIP, as a right for either disputing party (i.e., investors and States). Notwithstanding the above, the Contributor is against the creation of an appellate mechanism of ISDS awards. It must be recalled that in 2006 ICSID rejected the establishment of an appellate mechanism for awards rendered under the ICSID Convention. What the Contributor proposes instead is that the European Commission explores the possibility to allow to consolidate arbitral cases “that have a question of law or fact in common” into a single arbitration. In this regard, NAFTA Article 1126 (“Consolidation”) may be followed as a guide, taking into account that: - consolidation of claims is not automatic but has to be requested by a disputing party, i.e., either an investor or the respondent State (NAFTA Article 1126(3)); and, - the consolidation tribunal must take the decision to consolidate claims “in the interests of fair and efficient resolution of the claims, and after hearing the disputing parties” (NAFTA Article 1126(2)). The text should clarify, inter alia, the authority in charge of the constitution of the consolidation tribunal. In NAFTA Article 1126 such authority is ICSID’s Secretary-General.

C. General assessment

General assessment
  • What is your overall assessment of the proposed approach on substantive standards of protection and ISDS as a basis for investment negotiations between the EU and US?
  • Do you see other ways for the EU to improve the investment system?
  • Are there any other issues related to the topics covered by the questionnaire that you would like to address?

The Contributor rejects the European Commission’s biased approach towards investment protection as reflected in the Consultation. First, investment protection standards and ISDS are relevant not only for multinational corporations (“MNCs”), but also for individuals whose claims may amount to relatively small sums of money although the facts of their cases may be qualified as very serious breaches of standards of protection of international investment law. Second, an ISDS proceeding is a means of settling disputes. It supplements the investor’s fundamental right to access to justice and, as such, it may be also seen as a fundamental right. In fact, in many cases ISDS proceedings have truly been the only means for a foreign investor to obtain redress from actions and omissions of host States. Although the European Commission seems to deny it, there is no guarantee that a Party to the TTIP will not act contrary to international investment law. The Contributor hereby requests the European Commission to defend and protect investments and access by investors (whether natural or juridical, MNCs, small- or medium-sized companies) to ISDS proceedings.