{"id":5996,"date":"2019-04-23T06:46:31","date_gmt":"2019-04-23T11:46:31","guid":{"rendered":"https:\/\/www.iisd.org\/itn\/?p=5996"},"modified":"2024-08-09T18:29:42","modified_gmt":"2024-08-09T16:29:42","slug":"cjeu-advocate-general-finds-ics-in-line-with-eu-law-final-court-ruling-pending","status":"publish","type":"post","link":"https:\/\/www.iisd.org\/itn\/2019\/04\/23\/cjeu-advocate-general-finds-ics-in-line-with-eu-law-final-court-ruling-pending\/","title":{"rendered":"CJEU Advocate General finds ICS in line with EU law, final court ruling pending"},"content":{"rendered":"

CJEU<\/span> Advocate General Yves Bot issued a non-binding opinion<\/a> on January 29, 2019, deeming that the ICS<\/span> included in the Canada\u2013EU CETA<\/span> is compatible with EU<\/span> law. Bot assessed the ICS against the EU Treaty, the TFEU<\/span> and the EU Charter of Fundamental Rights.<\/p>\n

The Advocate General\u2019s opinion came following a request from Belgium for the EU\u2019s highest court to give its opinion on the ICS\u2019s compatibility with EU law. Belgium made the request<\/a> on September 7, 2017, a few weeks before CETA began its provisional application in Canada and the EU. The subject of ISDS<\/span>, either through the ICS or through another mechanism, has been especially contentious in Belgium, where the region of Wallonia was able to delay CETA\u2019s signature<\/a> over several concerns with the original version, ultimately leading to further negotiations and the adoption of a joint interpretative instrument<\/a>.<\/p>\n

Bot\u2019s opinion finds that the ICS mechanism \u201cdoes not undermine the autonomy of EU law and . . . does not affect the principle that the Court of Justice has exclusive jurisdiction over the definitive interpretation of EU law.\u201d Bot also says that the built-in safeguards for the ICS allow for enough access to an independent, impartial tribunal, which was one of the concerns raised by Belgium.<\/p>\n

Bot makes various other comments in relation to how CETA establishes the proposed tribunal\u2019s jurisdiction, stating that this is \u201cnarrowly circumscribed\u201d and is \u201cbound by the interpretation\u201d of the ECJ<\/span>. He also makes other findings related to the tribunal\u2019s interactions with EU legal systems at the EU-wide and national levels. For instance, he says that the joint interpretative instrument agreed by the EU and Canada encourages investors to exhaust local remedies before proceeding to cases under the ICS.<\/p>\n

Bot also says that, under CETA, there is no \u201calteration of the essential character of the powers which the Treaties confer on the institutions of the EU and on the Member States.\u201d Additionally, the Advocate General finds that the provisions of CETA \u201cdo not infringe the general principle of equal treatment\u201d in respect of access to the dispute settlement mechanism.<\/p>\n

The CJEU must still render its final opinion on CETA\u2019s ICS, which will be binding, though the date has not yet been confirmed. The ICS, as well as the provisions on investment protection and investment market access for portfolio investment, are not yet being applied in CETA. Their application is pending CETA\u2019s ratification<\/a> in EU member state legislatures.<\/p>\n

The European Commission has decided to pursue trade and investment<\/a> in separate agreements during upcoming negotiations with non-EU countries, due to the legal challenges seen in ratifying accords that incorporate both. That change in approach received the approval of the European Council in May 2018.<\/p>\n