Ref. Ares(2021)1553659 - 01/03/2021
NOTE
Ref. :
25 June 2020
Contact :
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FROM:
SUBJECT: BusinessEurope feedback to European Commission’s inception impact assessment on an
investment protection and facilitation framework
Feedback We welcome the initiative of the European Commission to clarify the rules related to the
protection of investments in the EU and to take appropriate action to ensure consistency
in their application and enforcement. We believe that facilitating cross-border investment
within the EU contributes to the creation of jobs, economic growth, as well as to the
promotion of research and innovation, thus enabling the EU to lead in key areas of the
economy. This becomes particularly important at a time when the EU focuses its efforts
on the recovery from the COVID-19 pandemic and on achieving the Green Deal and the
digitalisation of the economy.
As we prepare our more detailed contribution to the European Commission’s public
consultation on an intra-EU investment protection and facilitation initiative, we would like
to already share a few thoughts.
1) Looking at the regulatory and non-regulatory policy options to address divergencies
in the level of investment protection within the EU:
The provisions that allow the protection of investments are scattered in the large pool of
primary and secondary EU law. The recent European Commission Communication on
the protection of EU investments is helpful in clarifying the rights of investors.
Nevertheless, it does not codify them in one, single legal source. It is our view that this
is necessary as it would significantly facilitate investors and authorities alike to better
understand the legal framework for the protection of investments in the EU as well as
implement it and enforce it more effectively and efficiently.
2) Looking at the regulatory and non-regulatory policy options to address concerns
about the enforcement of investors’ rights:
It is our understanding that once intra-EU BITs are terminated, the enforcement of
investors’ rights wil be guaranteed by national courts with the Court of Justice of the EU
(CJEU) as the final arbiter. However, due to the lack of a unified framework, in practice
we see that EU Member States tend to interpret and implement investment protection
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provisions in different ways. This often leads to differentiated treatment of investors and
to different levels of protection within the Single Market. At this point, we would also like
to mention the well-known and documented rule of law problems in some EU Member
States.
Following the CJEU ruling on the Achmea case, it has been our view that the termination
of the intra-EU Bilateral Investment Treaties (BITs) should not take place before an
alternative mechanism is established to settle disputes between investors and states,
replacing the traditional Investor-to-State Dispute Settlement (ISDS) mechanism. This is
crucial in order to maintain the competitiveness as well as attractiveness of the EU Single
Market for investments and to avoid the discrimination of EU-investors vis-à-vis those
from third countries. Now that 23 EU Member States have signed an agreement on the
termination of intra-EU BITs, it is pertinent to ensure that this takes place in a coordinated
manner and that the discussion on creating the right framework for the resolution of
disputes is accelerated.
We understand that developing such a mechanism can be developed in accordance with
EU law and that it should respect a number of principles:
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Impartiality – to ensure the legitimacy of the mechanism
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Effectiveness – in terms of the application of law and the delivery of rulings and /
or awards that can be implemented and / or collected
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Efficiency and accessibility – to ensure that disputes are settled in a timely
manner and that costs are manageable for users, including SMEs
-
Transparency – to ensure that information on the disputes is publicly available
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