TTIP
tlement process and ensure the opportunity for public participation. The 2012 model BIT also introduces the concept of a multilateral appellate mechanism to review investor-state arbitral awards. The leaked Ceta draft also contains a strong investor-state arbitration provision, which reportedly was insisted on by both Canada and the EU. The Ceta also apparently suggests the creation of a committee to review the possibility of an appellate mechanism.
agreement between developed countries can be controversial. Australia, for example, insisted that its FTA with the US not include such a provision. This has led to debate over the pros and cons of investor-state arbitration as a means of settling disputes under investment treaties. The inclusion of an investor-state arbitration clause in the TTIP investment agreement, there- fore, may be more controversial than the Shared Principles would suggest, given the possibility that certain European countries may not be comfortable with binding dispute settlement.
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Robust transparency and public participation rules As noted, the US and the EU generally appear to be on the same page re- garding the desirability of transparency in dispute settlement. Despite the platitudes, however, the extent to which each side actually will incorporate
Stephen A Jones Partner, King & Spalding
Washington D.C., US W:
www.kslaw.com
EXPERT ANALYSIS
notions of transparency into other aspects of investment policy, such as per- mitting public involvement in the development of domestic laws imple- menting the investment agreement or otherwise relating to investment, remains to be seen.
US and EU investment policies overlap in many critical respects
The inclusion of an investor-state arbitration clause in an investment
Responsible business conduct The US and the EU agreed that governments “should urge that multina- tional enterprises operate in a socially responsible manner”. Thus, they agreed to promote adherence to the OECD Guidelines for Multinational Enterprises. Such a provision likely would not be controversial in the TTIP investment negotiations.
Narrowly tailored reviews of national security considerations The Shared Principles state that review of the national security implications of foreign investments “should focus exclusively on genuine national security risks”. The US has an established practice for reviewing investments that implicate national security considerations under the Committee on Foreign Investment in the United States (Cfius). An issue to watch will be whether the EU tries to incorporate safeguards against Cfius overreach into the TTIP investment agreement.
It remains to be seen how many of the Shared Principles actually will be
shared by the US and EU once negotiations become serious and the horse- trading begins. In addition, the public and private stakeholder responses to the Ceta investment agreement, which likely will be finalised and revealed to the public in detail during the early stages of the TTIP negotiations, could prompt changes in the dynamics of the negotiations. Although it is certainly too soon to tell, the available evidence suggests that the US and EU are largely on the same page with respect to investment policy. There is certainly reason for optimism that an agreement providing effective protections for investors throughout the largest potential trading bloc in the world is within reach.
About the author Stephen Jones is a partner in King & Spalding’s Washington D.C. office. The former chair of the firm’s international trade practice (2005- 2013), he represents companies and industries in trade remedy proceedings, particularly anti-dumping and countervailing duty investigations, administrative reviews, and appellate litigation. Jones appears regularly before the US Department of Commerce, the US International Trade Commission, the Office of the US Trade Representative, the US Court of International Trade, the US Court of Appeals for the Federal Circuit, and Nafta dispute settlement panels. He also advises clients on investment issues and dispute settlement under the WTO and other international agreements.
In addition to trade remedies, Jones also counsels US importers on compliance with US customs laws, including internal investigations, audits, compliance programs and penalty proceedings. He also advises on the customs provisions of Nafta and other free trade agreements, and conducts international trade due diligence in connection with corporate transactions and public disclosures.
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