ECJ confirms legality of unfair corporate tribunals in EU trade deals
The European Court of Justice (ECJ) today ruled that provisions for investor-state dispute settlement (ISDS, rebranded as ICS - Investment Court System) in the EU-Canada trade deal CETA are compatible with EU law.
This decision dangerously legitimises a mechanism that enables companies to claim multi-billion sum damages from governments that dare to stand up to their power. The ruling also comes as a blow to millions of citizens who have spoken out against this parallel justice system for corporations, most recently, more than 555,000 petitioners from all over Europe demanded an end to the ISDS system in all its forms.
Reacting to the decision, Corporate Europe Observatory’s trade campaigner Pia Eberhardt said:
“It’s a sad day for citizens when the European Court of Justice effectively approves VIP rights for corporations which can thwart government efforts to protect people and the environment, and provide access to billions of taxpayer money.
“After today’s ruling, the ball is back in the political arena. We call on all Parliaments in EU member states which still have to ratify CETA to reject this one-sided deal - it caters for big business needs but works against the interests of the majority of people in Europe.”
Notes to editors:
The ECJ ruling: The 30 April 2019 ruling follows a September 2017 request by Belgium, which had asked for the court’s opinion on CETA’s investor rights after unprecedented public controversy had led to a government crisis over the CETA ratification in autumn 2016 (an ECJ summary of the case is available here). It is the court’s second landmark ruling on the issue after it declared ISDS between EU member states illegal in its Achmea ruling from March 2018.
Germany’s Constitutional Court is also assessing CETA, particularly its controversial regulatory cooperation provisions.
CETA and its investment protection rules:
From ISDS to ICS: In an attempt to get around the enormous opposition generated by ISDS, the European Commission has rebranded it as ICS (Investment Court System) in CETA and other trade deals, for example, with Singapore and Vietnam. But analyses show that, like ISDS, the supposedly ‘new’ ICS empowers companies to circumvent national and European legal systems and sue governments in parallel tribunals when they regulate to protect the public interest and the environment.
A recent campaign to end ISDS in all its forms and push for a new system for holding corporations to account has so far gathered over 555,000 signatures from all over Europe.
Pia Eberhard, firstname.lastname@example.org, +49 (0) 152 5630 9102