TTIP and CETA vs. NAFTA: Reflections on Treaty Negotiations under Public Scrutiny - WAMR 2015 Vol. 9, No. 1

Author(s):

Michael P. Daly

Page Count:

14 pages

Media Description:

1 PDF Download

Published:

July, 2015

Jurisdictions:

International

Practice Areas:

NAFTA,

Other International Institutions and Rules,

Sources of Arbitration Law

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Description:

Originally From World Arbitration and Mediation Review (WAMR)

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I. INTRODUCTION

As the investment-treaty arbitration community responds to

the current crisis of legitimacy,1 the broader international

community is growing increasingly skeptical of the need for

investor-State dispute settlement (ISDS) provisions in massive

new free trade agreements such as the Transatlantic Trade and

Investment Partnership (TTIP) and the Comprehensive Economic

Trade Agreement (CETA). Some lament that intense public

scrutiny over investment protections has transformed the

traditionally diplomatic affair of treaty negotiations into a

political circus. Speculation and fear mongering aside, are we

experiencing a paradigm shift in how international investment

law is created and applied?

Following the motto that past behavior is the best indicator of

future behavior, this article examines the current setting by way

of comparison to the NAFTA.2 The NAFTA, now in force for more

than 20 years, provides historical insight suggesting that some

recent developments are not just revolutionary, but also

evolutionary. That being said, it is undeniable that investment-

treaty arbitration is at a critical crossroads right now, and the

resolution of the ongoing treaty negotiations will serve as a litmus

test for the future of the field.

II. TTIP AND CETA: WHERE ARE WE NOW?

TTIP, the agreement currently under consideration between

the U.S. and the European Union (EU), would create the world’s

largest free-trade zone. Given these high stakes, the media have

followed its negotiations closely, including the discussions

relating to ISDS. In June 2013, the EU Member States endorsed

investment protections, including “investor-to-state dispute

settlement,” for TTIP in a negotiating directive to the EU trade

delegation.3 Yet the former EU Trade Commissioner, Karel De

Gucht, paused all TTIP negotiations concerning ISDS in January

2014 in an attempt to “improv[e] ISDS to prevent abuse.”4 He

provided the general public with a 90-day period to comment on

the transparency and accountability of the ISDS system, after

which the results were published online and presented to the
European Parliament.5