The negotiations for ECT modernization are now underway, with the first such meetings held in December 2019 and at least four other sessions planned over 2020.
The talks between China and the EU for a Comprehensive Agreement on Investment saw an important milestone in December 2019, as the two sides exchanged new market access offers. They had exchanged market access offers once previously, in July 2018.
The United States–Mexico–Canada Agreement (USMCA) has been ratified and signed into law in the United States, bringing the trade and investment deal one step closer to entry into force. Of the three countries involved, the only one that has not completed its ratification processes is Canada.
The United Kingdom’s exit from the EU formally took place on January 31, 2020, following years of talks and repeated extensions in the Brexit deadline. With the United Kingdom now in an 11-month transition period, questions remain over the shape of the country’s future trade and investment relationship with the EU and other partners, though some further indications of what this may entail are beginning to emerge.
The new year saw the entry into force of two new trade deals involving Australia, namely those involving Peru and Hong Kong. The two agreements both feature investment chapters and were ratified in the Australian legislature in late December, together with a separate accord involving Indonesia.
The European Parliament has given the green light to the 27-nation bloc’s trade and investment agreements with Vietnam, over seven years after those negotiations formally began.
A group of 20 civil society organizations and trade unions from the African continent have circulated a letter questioning the EU’s multilateral investment court (MIC) proposal in the context of the UNCITRAL Working Group III talks on multilateral ISDS reform and urging for a set of alternative proposals to advance instead.
From November 25 to 27, 2019, the Office of the UN High Commissioner for Human Rights hosted this year’s United Nations Forum on Business and Human Rights in Geneva, Switzerland.
The UNCTAD High-Level IIA Conference, held in Geneva, Switzerland, in November 2019 featured a session dedicated to investment facilitation and promotion.
On November 6, 2019, the Energy Charter Conference confirmed that it would hold the first session of its “Modernization Group” on December 12, 2019, kicking off the process to revise the decades-old ECT.
Leaders from 15 of the countries negotiating the Regional Comprehensive Economic Partnership (RCEP) announced on November 4, 2019, that they had clinched a deal that would govern trade and investment across a wide swath of the Asia–Pacific region.
The joint initiative being pursued by 92 WTO members on developing a multilateral framework on investment facilitation has reached a new phase, with various new participants involved and a push for significant progress ahead of a December stocktaking meeting.
A long-simmering row over plans for two new pipelines that would carry natural gas from Russia into Germany has advanced quickly in recent months, after gas company Nord Stream 2 submitted a notice of arbitration against the EU under the ECT on September 26, 2019.
A set of documents purporting to capture the discussions of the United States–United Kingdom Trade and Investment Working Group from 2018 has recently been released into the public domain.
Delegates to the UNCITRAL Working Group III process on multilateral ISDS reform will meet again in Vienna during the week of October 14–18, 2019.
On August 16, 2019, the ICSID secretariat released the third working paper featuring proposed rule amendments, based on inputs from member states and the public.
Negotiations for the RCEP trade and investment deal should be finalized by the end of 2019 and have seen notable progress on market access negotiations and services-related annexes, according to a statement issued in August by ministers from the 16 countries involved in the process.
Talks for an EU–China BIT have made some progress in the areas of financial services and national treatment, according to a report circulated by the European Commission in July, with another negotiating round planned for the week of September 23.
The 70 WTO members participating in the structured discussions on a possible multilateral framework on investment facilitation concluded their current phase of work in late July and are reportedly looking to “intensify” their efforts after the organization’s annual August hiatus.
The African Union formally kicked off the operational phase of the African Continental Free Trade Agreement (AfCFTA) during a high-level summit in Niger in early July 2019 that brought together heads of state and government from across the continent.
The European Council has approved negotiating directives for the EU’s participation in talks to modernize the ECT, confirming its decision during a meeting on July 2, 2019.
Delegates involved in the UNCITRAL Working Group III process on multilateral ISDS reform have until July 15, 2019 to submit to the UNCITRAL Secretariat their reform proposals and the timing for when such items may be considered in an overarching project schedule. That schedule would help guide the working group under Phase 3 of its mandate, which is devoted to crafting solutions to ISDS-related concerns.
The EC released on May 14 a set of draft negotiating directives setting out its proposed approach in “modernizing” the Energy Charter Treaty (ECT).
The African Continental Free Trade Area (AfCFTA) entered into force on May 30, 2019, with the first phase of the deal taking effect for 24 countries. An extraordinary summit on the trade agreement is planned for July 7, 2019 in Niamey, Niger, while Phase II negotiations on intellectual property rights (IPRs), investment and competition policy are expected to take at least another year.
The CJEU has deemed that the ICS included in the Canada–EU CETA is consistent with EU law, issuing its final opinion on April 30, 2019.
The Mexican Senate approved the implementing legislation for the United States–Mexico–Canada Agreement (USMCA) on June 19, 2019, by an overwhelming majority of 114 votes in favour, with less than a dozen against or abstaining.
Leaders from China and the EU have pledged to finalize negotiations for their Comprehensive Investment Agreement next year, announcing their target date and further details about the process during a summit in Brussels, Belgium, on April 9, 2019.
Australia has signed a new BIT with Uruguay and an investment deal with Hong Kong. The agreements feature some changes or clarifications to past deals’ provisions on ISDS and on government regulations designed to fulfill public policy objectives, such as health.
Twenty-two EU member states endorsed a political declaration on January 15, 2019, where they announced a series of actions involving existing intra-EU BITs and upcoming or ongoing investment arbitration.
The European Economic and Social Committee (EESC) has weighed in on the European Commission’s recommendation for a European Council decision to launch negotiations on the proposed MIC, supporting discussions on ISDS reform while noting areas for improvement.
CJEU Advocate General Yves Bot issued a non-binding opinion on January 29, 2019, deeming that the ICS included in the Canada–EU CETA is compatible with EU law. Bot assessed the ICS against the EU Treaty, the TFEU and the EU Charter of Fundamental Rights.
On December 21, 2018, the United Nations General Assembly has given its approval to a new “Convention on International Settlement Agreements Resulting from Mediation,” which aims to answer past concerns by many countries over how to enforce mediation settlement agreements involving multiple countries.
The European Union’s new framework for screening FDI is due to take effect in April 2019, with the text now published in the EU’s Official Journal. The framework allows both EU member states and the European Commission until October 2020 to enact the changes required.
Ministers from the 16 countries negotiating RCEP gathered in Siem Reap, Cambodia, on March 2 for an intersessional meeting to take stock of negotiations and reaffirm their revised goal of concluding the talks this year.
The CPTPP entered into force on December 30, 2018, when it took effect for Australia, Canada, Japan, Mexico, New Zealand and Singapore. Vietnam followed suit on January 14, 2019.
ASEAN economic ministers are due to meet in Thailand this month, where they will sign a new protocol that would revise their existing, ASEAN-wide investment agreement, as well as their new ASEAN Trade in Services Agreement (ATISA). Negotiations to update both agreements concluded in late 2018.
Australia and Indonesia have now signed their Comprehensive Economic Partnership Agreement (IA-CEPA), bringing to a close a negotiating process that began in November 2010. The two countries signed the agreement on March 4, 2019. The IA-CEPA also includes an investment chapter and four related annexes, which cover an arbitrators’ code of conduct; expropriation and compensation; foreign investment policy; and public debt.
Delegates had a new round of deliberations for multilateral reform of ISDS at UNCITRAL from April 1 to 5. The meeting of Working Group III, which is tasked with this process, was held in New York.
“Structured discussions” on a possible multilateral facilitation framework resumed in Geneva this past month. The meeting, held in early March, marked the first session of the new year, and begins a new phase in the structured discussions process. The WTO members involved previously met seven times during 2018, examining a series of overarching objectives that this framework could address.
On November 20, 2018, the European Parliament, Council and Commission reached political agreement on an EU framework for screening FDI, and on December 11, 2018, the International Trade Committee of the European Parliament endorsed the political agreement.
On October 31, 2018, Australia became the sixth state to formally ratify the CPTPP, along with Canada, Japan, Mexico, New Zealand and Singapore.
On October 19, 2018, Singapore and the European Union signed political and trade agreements as well as the EU–Singapore Investment Protection Agreement (IPA).
UNCITRAL Working Group III continued discussions on possible reform of investor–state dispute settlement (ISDS) at its 36th session, held October 28–November 2, 2018 in Vienna.
In a speech to the United Nations General Assembly on October 25, 2018, Judge Abdulqawi Yusuf, President of the International Court of Justice (ICJ), mentioned that the court has decided to restrict the practice of allowing members to serve in arbitral tribunals.
During the week of October 15–19, 2018, the fourth session of the Open-Ended Intergovernmental Working Group on Transnational Corporations and Other Business Enterprises with Respect to Human Rights took place in Geneva.
On September 30, 2018, U.S. Trade Representative (USTR) Robert Lighthizer and Canadian Foreign Affairs Minister Chrystia Freeland announced that the two countries had reached an agreement, alongside Mexico, on a modernized trade deal.
UNCITRAL Working Group III is scheduled to continue discussions on possible reform of ISDS at its 36th session, to be held October 29–November 2, 2018 in Vienna.
Canadian Minister of International Trade Diversification Jim Carr announced on August 14, 2018 the launch of a public consultation on Canada’s BITs, known as foreign investment promotion and protection agreements (FIPAs).
The fourth session of the Intergovernmental Working Group on Transnational Corporations and Other Business Enterprises with Respect to Human Rights will take place October 15–19, 2018 in Room XX of the Palais des Nations in Geneva.
In a September 12, 2018 letter, 312 legislators—including Democrats as well as Republicans—from all 50 U.S. states wrote that they “strongly support” U.S. Trade Representative (USTR) Robert Lighthizer’s efforts to remove ISDS from NAFTA.