Friday

24th May 2019

EU top court backs Canada trade deal in ruling

  • Wallonia's then leader, Paul Magnette, here pictured on an anti-CETA poster, triggered the question put to the EU top court (Photo: Campact)

The EU-Canada free-trade agreement's rules on protecting investors in case of a dispute with states do not breach EU law, the EU's top court ruled on Tuesday (30 April).

The judges of the European Court of Justice (ECJ) said in their ruling that the mechanism to resolve disputes between investors and states, which critics say unfairly favour multinationals, is in line with EU law.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

The binding ruling of the Luxembourg-based ECJ means a sigh of relief for supporters of the deal.

It also means, the court backed the system agreed by Canada and the EUon protecting the rights of foreign investors, for situations where investors from either side claim they have been unfairly treated.

The judges said that the tribunals set up by the agreement cannot have the power to interpret or to apply EU law, other than those in the deal, in a way that could hinder the power of EU institutions.

The court also said the deal contains provisions which deprive the tribunals of questioning the choices of states when those states curb an investor's rights due to the protection of public order, public safety, food safety, the protection of public morals, consumer protection, protection of fundamental rights and human life and health.

The court said that while the deal offers remedy for foreign investors, their situation "is not comparable to that of investors of member states who invest within the EU".

The free trade deal was seven years in the making when in 2016 Belgium's Wallonia refused to give its blessing to the agreement due to concerns over the dispute settlement, and environmental standards.

In the end, Belgium struck a deal - attaching clarifications to the trade agreement, and taking the court system to the European Court of Justice to check if it was now in line with EU law.

A negative ruling could have derailed the use of such tribunal systems, which the EU had used in other trade negotiations.

The Canada deal entered into force on a provisional basis in September 2017, and full implementation requires the ratification of all EU national parliaments, and some regional assemblies, like in Belgium.

Belgium's foreign minister Didier Reynders welcomed Tuesday's court's ruling.

"With its opinion, the court dismisses the remaining legal concerns," he said in a statement, pointing out that due to the Canada trade deal Belgium's exports to Canada grew strongly in the first year, with an average increase of more than 30 percent compared to a European average of 6 percent.

Reynders said the court system is the first step towards establishing a multilateral court system that "will eventually become the competent legal forum for resolving the investor-state disputes".

The EU commission has been pushing since 2015 for the establishment of a permanent body to decide on investment disputes, to move away from the ad hoc arbitration.

The commission's ambitions have now been given a boost by the court's ruling.

Both the EU-Canada deal and the EU-Vietnam free trade agreement foresee setting up a permanent multilateral mechanism.

The EU has been working to convince Japan on setting up of an investment court system, but Japan favours the old-style investor-state dispute settlement (ISDS) system.

MEPs approve Canada trade deal amid protest

Amid protests in front of the European Parliament's Strasbourg building and after heated debate among MEPs, the landmark trade deal with Canada was approved with a comfortable majority.

EU and Japan in delicate trade talks

The Japanese PM comes to Brussels to discuss the first results of the new EU-Japan free trade deal, plus WTO reform - a sensitive topic before he moves onto Washington to face Donald Trump.

News in Brief

  1. UK's May announces June 7 resignation date
  2. Ireland votes for EU election and divorce referendum
  3. Report: May to announce resignation plan on Friday
  4. Leading politicians: time for EU to have female leaders
  5. Poll: Finland's Green party to surge in EU elections
  6. High demand for postal voting in Denmark
  7. Some EU citizens turned away at UK polling stations
  8. Switzerland unlikely to sign draft EU deal

Feature

Romania enlists priests to promote euro switchover plan

Romania is due to join the single currency in 2024 - despite currently only meeting one of the four criteria. Now the government in Bucharest is enlisting an unlikely ally to promote the euro to the public: the clergy.

Trump and Kurz: not best friends, after all

The visit of Austrian chancellor Sebastian Kurz to the White House on Wednesday showed that the current rift in transatlantic relations is deepening by the day.

Stakeholders' Highlights

  1. Vote for the EU Sutainable Energy AwardsCast your vote for your favourite EUSEW Award finalist. You choose the winner of 2019 Citizen’s Award.
  2. Nordic Council of MinistersEducation gets refugees into work
  3. Counter BalanceSign the petition to help reform the EU’s Bank
  4. UNICEFChild rights organisations encourage candidates for EU elections to become Child Rights Champions
  5. UNESDAUNESDA Outlines 2019-2024 Aspirations: Sustainability, Responsibility, Competitiveness
  6. Counter BalanceRecord citizens’ input to EU bank’s consultation calls on EIB to abandon fossil fuels
  7. International Partnership for Human RightsAnnual EU-Turkmenistan Human Rights Dialogue takes place in Ashgabat
  8. Nordic Council of MinistersNew campaign: spot, capture and share Traces of North
  9. Nordic Council of MinistersLeading Nordic candidates go head-to-head in EU election debate
  10. Nordic Council of MinistersNew Secretary General: Nordic co-operation must benefit everybody
  11. Platform for Peace and JusticeMEP Kati Piri: “Our red line on Turkey has been crossed”
  12. UNICEF2018 deadliest year yet for children in Syria as war enters 9th year

Latest News

  1. EU election results to trigger top jobs scramble This WEEK
  2. Don't tell the Dutch - but Timmermans 'won'
  3. EU says goodbye to May with 'respect'
  4. Strache scandal: how big a hit will Austrian far-right take?
  5. Italy train row exposes competing views of EU
  6. Dutch socialists on top in first EP election exit poll
  7. No usage data kept for EU parliament's 'Citizens' App'
  8. EU sanctions regime cannot be an 'EU Magnitsky Act'

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic commitment to driving global gender equality
  2. International Partnership for Human RightsMeet your defender: Rasul Jafarov leading human rights defender from Azerbaijan
  3. UNICEFUNICEF Hosts MEPs in Jordan Ahead of Brussels Conference on the Future of Syria
  4. Nordic Council of MinistersNordic talks on parental leave at the UN
  5. International Partnership for Human RightsTrial of Chechen prisoner of conscience and human rights activist Oyub Titiev continues.
  6. Nordic Council of MinistersNordic food policy inspires India to be a sustainable superpower
  7. Nordic Council of MinistersMilestone for Nordic-Baltic e-ID
  8. Counter BalanceEU bank urged to free itself from fossil fuels and take climate leadership
  9. Intercultural Dialogue PlatformRoundtable: Muslim Heresy and the Politics of Human Rights, Dr. Matthew J. Nelson
  10. Platform for Peace and JusticeTurkey suffering from the lack of the rule of law
  11. UNESDASoft Drinks Europe welcomes Tim Brett as its new president
  12. Nordic Council of MinistersNordic ministers take the lead in combatting climate change

Join EUobserver

Support quality EU news

Join us