Belgium had doubts whether the Investment Court System ICS, which is part of CETA, would be compatible with Union law and therefore contacted the ECJ as early as 7th September 2017. The Advocate General now states in his Opinion from 29th January 2019 that “Contrary to what is sometimes claimed, establishing a dispute settlement mechanism such as that under examination does not, in my view, mean calling into question the judicial system of the European Union and of its Member States or the ability of that system to deal effectively, independently and impartially with actions brought by foreign investors. By establishing such a mechanism in its bilateral relations in the field of investment, the European Union intends to satisfy a demand for neutrality and speciality in the resolution of disputes between investors and States, bearing in mind that it will also benefit European investors when they invest in a third State.” Hence, Advocate General Bot’s Opinion comes to the conclusion that the treaty does not impact the autonomy of Union law. Thus, CETA shall not affect the ECJ’s principle of exclusive jurisdiction to render binding interpretation of Union law. Hence, privileged investor protection was therefore in conformity with EU law.

However, the Opinions of the Advocates General are not binding. Even though the judges frequently follow the thrust, there are exceptions. For example, in the Achmea case, the Advocate General gave an Opinion, which the ECJ decision did not follow. As a result, the almost 200 investment protection agreements between EU Member States were declared as not being in conformity with EU law and only last week, in the so-called “Achmea declaration” by the EU Member States, they were declared as annulled. Hence, one also has to wait for the decision of the ECJ judges in respect of CETA. It has been scheduled for the end of May.

Privileged arbitration courts for private investors are also highly controversial in Austria. For example, President Alexander van der Bellen has postponed his signing of CETA until the ECJ has delivered its decision.

Together with many other stakeholders from trade union and civil society, AK President Renate Anderl has also been very critical: “The Chamber of Labour maintains: We do not want a separate legal system for investors, who would then be able to bring an action at the expense of workers, consumers and citizens.”

Rights for people, rules for corporations

How much people are concerned about the investor-state dispute settlement ISDS, which they perceive as parallel justice, is demonstrated by the Campaign „Rights for People, Rules for Corporations – Stop ISDS!“, which is supported by AK EUROPA. Within in just one week, more than 273,000 EU citizens have signed the petition. Apart from putting an end to investor-state dispute settlements, the Campaign also supports a strong “UN Binding Treaty”: Often it is not possible to prosecute corporations for the violation of labour standards und human rights. A binding treaty of the United Nations, namely the UN Binding Treaty Process, shall remedy the situation.  

Further information:

AK EUROPA: International campaign demands new rules for Corporations

Opinion of the Advocate General