The European Commission decided (21 January) that it would be postponing negotiations on an investor-state dispute settlement mechanism in the context of the EU-US trade and investment partnership (TTIP), with a view to launching a public consultation.
“I know some people in Europe have genuine concerns about this part of the EU-US deal,” said EU Trade Commissioner Karel de Gucht, adding that the decision reflected the EU executive’s determination to secure the right balance between protecting European investment interests and upholding governments’ right to regulate in the public interest.
The TTIP negotiations launched last June included the so-called “investor-state” dispute clauses empowering EU and US-based corporations to lodge private legal cases directly against governments.
The European Commission’s proposal initially would have enabled US companies investing in Europe to by-pass European courts and directly challenge governments at international tribunals, whenever they find that laws in the area of public health, environmental or social protection infringe their right to do business. EU companies investing abroad would have had the same rights in the United States.
“Governments must always be free to regulate so they can protect people and the environment. But they must also find the right balance and treat investors fairly, so they can attract investment,” De Gucht said.