MERCOSUR AND THE EUROPEAN UNION AGREE HISTORIC AND AMBITIOUS TRADE AGREEMENT

22 July, 2019

On June 28, 2019, the European Union and the Common Market of the South (“Mercosur”), announced they had reached a trade deal after twenty years of negotiations (the “EU-Mercosur Agreement”).  While the agreement in principle is still subject to ratification by the national parliaments of the member states of both blocs, the European Parliament and the European Union Council – a process that could take between one and two years – it lays the ground for an “ambitious and comprehensive trade agreement”,[1] said to be the largest the European Union has ever concluded.

The historic deal creates a market covering a population of 800 million people that represents nearly a fourth of the world’s GDP.  In addition to removing tariffs, the new agreement aims to enhance the economic and political integration of both regions by creating employment and developing a more transparent and predictable regulatory framework.

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The European Parliament’s study on arbitration legal instruments and practice in the EU and Switzerland: a step towards a uniform European regime on arbitration?

20 February, 2015

Two weeks ago the European Parliament’s Policy Department for Citizens’ Rights and Constitutional Affairs published a broad study on the legal instruments and practice of arbitration across the European Union and Switzerland.  This study was undertaken over the past year at the Brunel Centre for the Study of Arbitration and Cross-Border Investment and is based on academic research and the results of a large-scale survey of arbitration practitioners across the EU and Switzerland.

The primary goal of this study is “to portray accurately the actual diversity of arbitration law and practice across the European Union and Switzerland” in order to “discuss the strengths and weaknesses of the law and practice observed” in each European jurisdiction.  In doing so, it first examines the legal framework and practice of arbitration in each Member State.  It then analyses specialised topics of arbitration such as commercial, consumer and online arbitration and finally it evaluates the involvement of EU Member States and the EU in investor-state arbitration.

The study also provides insights into and recommendations for potential future actions and reforms mainly to improve the interaction between arbitration and EU law. Whilst the purpose of this contribution is to guide the European Parliament in its future decisions regarding arbitration, it remains uncertain whether potential reforms on this topic are part of Europe’s broader agenda. Continue reading →

Repaving the Southeast Asian Silk Road: EU-Singapore Free Trade Agreement negotiations concluded

13 November, 2014

In the wake of the recent agreement of the EU-Canada Comprehensive Economic and Trade Agreement (EU-Canada CETA) and after just over a year of negotiations, the EU and Singapore have released their free trade Agreement (EUSFTA) to the public.  (See our recent blog post on CETA here). According to a statement released by the European Commission, the EUSFTA aims to ensure a high level of investment protection, whilst preserving the EU and Singapore’s right to regulate.  It will replace the 12 existing Bilateral Investment Agreements (BITs) between Singapore and European Member States.  The text of the EUSFTA can be found here.

Whilst the conclusion of this agreement is highly significant, the reference to the European Court of Justice to which it has given rise could perhaps be even more so.  Please see our recent blog post here, explaining the European Commission’s request for an ECJ Opinion on the EU’s competence to enter into EUSFTA.

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Long-awaited EU-Canada trade agreement agreed – a blueprint to set the standard for future investment protection?

2 October, 2014

On Friday 26 September, after five years of negotiations, the EU and Canada agreed in principle to a text for the Comprehensive Economic Trade Agreement (CETA). It is certainly comprehensive, running to 1,500 pages. It is the first such agreement signed by the EU as part of its policy (since the Lisbon Treaty) of assuming competence for trade and investment from the individual Member States. Its contents have therefore been keenly anticipated as an indication of the tone of future agreements, particularly as regards investment protection and investor-state dispute resolution (ISDS) contained in Chapter X.

CETA’s provisions are comprehensive as regards both of these areas, but with significant caveats, largely mirroring the drafts that have so far been made public in the EU-US forthcoming agreement in the Transatlantic Trade and Investment Partnership (TTIP) (see our earlier post on the TTIP consultation here).

As its Preamble sets out, the agreement expressly recognizes “that the protection of investments… stimulates mutually beneficial business activity“. At the same time, it stresses principles of governmental autonomy (including enforcement of labour and environmental laws) which can in some circumstances limit the rights of the investor. It also points out the responsibility of businesses to respect “internationally recognized standards of corporate social responsibility“, bringing these soft law norms into the ambit of the agreement.

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New regulation sets out financial responsibility for investor-state disputes between the European Union and third countries

17 September, 2014

Today (17 September 2014) a new European Regulation enters into force (EU No 912/2014) with wide-ranging implications for the global investment community. The Regulation allocates financial responsibility going forward, for claims brought by non-EU investors for harm done to their investment within the European Union. Depending on who was involved in the treatment in question – a Member State or a body, institution or agency of the EU itself, responsibility is allocated accordingly.

The rules will only be applied to investor-state disputes brought under agreements to which the EU is itself a party and which incorporate an Investor State Dispute Settlement (ISDS) mechanism. The Energy Charter Treaty (ECT) is one such treaty already in existence and several bilateral investment treaties (BITs) between the EU and third states are in the process of being negotiated, in some cases with a view to replacing the current BITs between EU Member States and third states. This forms part of a wider re-evaluation of investment issues and the relative competences of individual Member States and the EU.

EU Trade Commissioner Karel De Gucht has described the Regulation as “another building block in our efforts to develop a transparent, accountable and balanced investor-to state dispute settlement mechanism as part of EU trade and investment policy.”

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TTIP: EU Commission publishes statistical report on responses to the public consultation on ISDS and investment protection

6 August, 2014

On 18 July, the EU Commission published its Preliminary Report (statistical overview) on the responses to its consultation on investment protection and ISDS in the TTIP (for discussion of the consultation, see our previous blog post).

The Preliminary Report demonstrates that there was considerable interest in the consultation, with a total of 149,399 online replies. The greatest number of replies came from the UK at 34.8%, with 22.59% from Austria and 21.76% from Germany. The high proportion of responses from Germany in particular is unsurprising, given that the German Government’s approach to ISDS has received considerable coverage in both the legal and mainstream press.

Significantly, over 99% of responses were submitted by individuals (with only 569 by organisations, many of which were NGOs). 42% of the respondents agreed that their contribution can be made public and the Commission will publish those responses in due course.

The Commission will now analyse the responses, a task which it says is unlikely to be completed before November. It remains to be seen how the response analysis will influence the EU’s approach to negotiations of these issues with the US.

For further information, please contact Christian Leathley, Partner, Hannah Ambrose, Professional Support Lawyer, or your usual Herbert Smith Freehills contact.

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Sanctions Update: EU and US introduce further sanctions in response to the situation in Ukraine; EU amends sanctions against Libya, Central African Republic and Syria

27 June, 2014

Herbert Smith Freehills has published its latest Sanctions Update e-bulletin, on the latest developments in sanctions regimes in Ukraine, Libya, Central African Republic and Syria.

Both the EU and US have introduced limited additional sanctions in light of the current situation in Ukraine, and Australia has announced its list of Ukraine-related designated persons.  The EU has also announced amendments to its sanctions against Libya, the Central African Republic and Syria.  Of these developments, the most significant is a ban on the import into the EU of goods from Crimea and Sevastopol, and any associated financing or re/insurance by EU persons.

For further information, please contact Susannah Cogman, Partner, Elizabeth Head, Associate, or your usual Herbert Smith Freehills contact.

Susannah Cogman
Susannah Cogman
Partner
+44 20 7466 2580
Elizabeth Head
Elizabeth Head
Associate
+44 20 7466 7555

Europe consults on investment protection and ISDS in the TTIP

19 May, 2014

The European Commission has launched a public consultation on its proposed approach to investment protection and investor-state dispute settlement (ISDS) provisions in the Transatlantic Trade and Investment Partnership (the TTIP).  The TTIP is a free trade agreement currently in negotiation between the United States and the European Union. Negotiations for the TTIP began in July 2013.

The Commission has described its approach as containing “a series of innovative elements that the EU proposes using as the basis for the TTIP negotiations” and stated that the key issue on which it is consulting is “whether the EU’s proposed approach for TTIP achieves the right balance between protecting investors and safeguarding the EU’s right and ability to regulate in the public interest”.

Whilst the EU is not consulting on a draft text of the TTIP, it has included as a reference text the investment protection and ISDS provisions in the Comprehensive Economic and Trade Agreement (the CETA), between the EU and Canada. 

Whilst we are currently a long way from a signed agreement including investment protection and ISDS provisions, stakeholders may nonetheless want to take this opportunity to consider the ways in which the EU’s approach and the negotiations could impact upon them.  The European Commission’s Consultation can be found here and closes on 6 July 2014.

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Ukraine – EU imposes asset freeze and travel ban on 21 Russian individuals; US introduces additional Executive Order and imposes asset freeze and visa ban on 11 Ukrainian and Russian individuals

20 March, 2014

Herbert Smith Freehills has published its latest Sanctions Update e-bulletin, on the imposition targeted sanctions by the EU and US in response to the recent Crimea referendum.

On 17 March 2014, the EU introduced an asset freeze and travel ban applying to 21 Russian individuals. On the same day, the US introduced a second Executive Order, allowing it to sanction Russian individuals and released a list of 11 Russian and Ukrainian individuals subject to an asset freeze and visa ban under its Executive Orders.

For further information, please contact Rod Fletcher, Partner, Susannah Cogman, Partner, Daniel Hudson, Partner, or your usual Herbert Smith Freehills contact.

Rod Fletcher
Rod Fletcher
Partner
+44 20 7466 2411
Susannah Cogman
Susannah Cogman
Partner
+44 20 7466 2580
Daniel Hudson
Daniel Hudson
Partner
+44 20 7466 2470

Ukraine – EU imposes asset freeze on members of former government and issues a statement in relation to Russia; US introduces Executive Order permitting the blocking of assets

17 March, 2014

Herbert Smith Freehills has issued its latest Sanctions Update e-bulletin, concerning the EU and US response to recent events in Ukraine.

On 5 March 2014, the EU introduced an asset freeze applying to former President Yanukovych and other former government officials and persons associated with the former government. The UK has introduced domestic legislation criminalising breaches of this asset freeze. The EU also held an emergency Heads of State meeting on 6 March. The conclusions from that meeting indicate that there is a possibility of EU sanctions being imposed on Russia in the absence of negotiations between Russia and Ukraine which produce results within a limited timeframe. Also on 6 March the US introduced an Executive Order which would permit the imposition of an asset freeze and visa bans although no companies or individuals have yet been designated.

For further information, please contact Rod Fletcher, Partner, Susannah Cogman, Partner, Daniel Hudson, Partner, or your usual Herbert Smith Freehills contact.

Rod Fletcher
Rod Fletcher
Partner
+44 20 7466 2411
Susannah Cogman
Susannah Cogman
Partner
+44 20 7466 2580
Daniel Hudson
Daniel Hudson
Partner
+44 20 7466 2470