Abstract
Following the entry into force of the Treaty of Lisbon on 1 November 2009 the European Union (EU) has been able to extend its competence for the Common Commercial Policy (CCP) into the field of Foreign Direct Investment (FDI) (Art. 207 Paragraph 1 of the Treaty on the Functioning of the European Union; TFEU). While this volume is generally dedicated to the many challenges and open questions relating to this new activity, the present Chapter shall focus on the consequences for third countries, in particular other OECD countries that compete with the European Union and its members for FDI inflows and investment opportunities worldwide. In particular, the view of European neighbours, i.e. members of the European Economic Area (EEA) and the European Free Trade Association (EFTA) shall be analysed more thoroughly. While they do share many of the regulations within the internal market, they are autonomous when it comes to their foreign economic policy although they certainly have a keen interest to obtain at least similar concessions as the EU from their trading partners and to be attractive for foreign investment. But also the perspective of major trading powers (USA, Japan, Canada etc.) and emerging economies like Brazil, China or India shall be discussed as they are competing within the framework of multilateral agreements like the WTO. This Chapter shall not provide a detailed analysis of the various theoretical questions as this seems not necessary in view of the excellent contributions to this book but rather complement them. The main focus is rather to have a look at possible scenarios in view of the future of the EU’s FDI policy.
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Notes
- 1.
For a detailed analysis see Burgstaller, European Law and Investment Treaties, Journal of International Arbitration 26 (2009) 2, p. 181; Podestà, Bilateral Investment Treaties and the European Union. Recent Developments in Arbitration and Before the ECJ, The Law and Practice of International Courts and Tribunals 8 (2009) 2, p. 225; Herrmann, Die Zukunft der mitgliedstaatlichen Investitionspolitik nach dem Vertrag von Lissabon, Europäische Zeitschrift für Wirtschaftsrecht 21 (2010) 6, p. 207 and Tietje, EU-Investitionsschutz und -förderung zwischen Übergangsregelungen und umfassender europäischer Auslandsinvestitionspolitik, Europäische Zeitschrift für Wirtschaftsrecht 21 (2010) 17, p. 647.
- 2.
See Herrmann, Grundzüge des europäischen Außenwirtschaftsrechts, Zeitschrift für europarechtliche Studien 11 (2008) 1, p. 81.
- 3.
See also Bungenberg, Going global?, in: Herrmann/Terhechte (eds.), European Yearbook of International Economic Law, 2010 , p. 123.
- 4.
See the Agreement on Investment of the Framework Agreement on Comprehensive Economic Cooperation between the People’s Republic of China and the Association of Southeast Asian Nations of 15 August 2009.
- 5.
The so-called Cross-Strait Investment Agreement signed on 9 August 2012.
- 6.
In particular, Art. 63 et seqq. TFEU (ex-Art. 56 et seqq. ECT). With regard to their significance for capital inflows from third States see: ECJ, Case C-452/04, Fidium Finanz AG v Bundesanstalt für Finanzdienstleistungsaufsicht, [2006] ECR I, 09521.
- 7.
Economic Partnership, Political Coordination and Cooperation Agreement between the European Community and its Member States, of the one part, and the United Mexican States, of the other part, 8 December 1997, OJ L 276 of 28 October 2000, Art. 8 and 9.
- 8.
See below note 23 for the description of the EU-Mexico Agreement.
- 9.
See Ziegler, Multilateraler Investitionsschutz im Wirtschaftsrecht, in: Ehlers / Wolffgang (eds.), Rechtsfragen internationaler Investitionen, 2009, p. 63.
- 10.
See de Mestral, Is a model EU BIT possible — or even desirable? Columbia FDI (2010) 21, available at: http://www.vcc.columbia.edu/.
- 11.
Agreements with Hungary of 5 October 1988, with Poland of 8 November 1989, with the Slovak Republic and the Czech Republic (at the time still as Czechoslovakia) of 5 October 1990, with Romania of 25 October 1993, with Bulgaria of 28 October 1991, with Estonia of 21 December 1992, with Latvia of 22 December 1992, with Lithuania of 23 December 1992, with Slovenia of 9 November 1995. Malta had concluded an agreement with Switzerland as early as 1965, but this agreement was terminated by Malta in preparation for EU membership in 2005. The termination by Malta took effect on 23 February 2005, published in: Amtliche Sammlung des Bundesrechts der Schweiz (AS) 2005, 1163. Cyprus never had negotiated a BIT with Switzerland.
- 12.
This process is not yet entirely terminated; e.g. there exist BITs between Switzerland and Croatia (30 October 1996), Macedonia (26 September 1996), Montenegro and Serbia (originally as Serbia-Montenegro, 7 December 2005) and Turkey (3 March 1998).
- 13.
See the « amicus curiae briefs » by the European Commission and the reaction of the arbitrators in the cases: SCC No. 088/2004, Eastern Sugar v. Czech Republic (Partial Award), ICSID Case No. ARB /07/22, AES v. Hungary (Award), ICSID Case No. ARB/07/19, Electrabel v. Hungary (Award n.y.p.), PCA Case No 2008-13, Eureko v. Slovakia (Award n.y.p.) – to mention but a few.
- 14.
See: « Italy, Slovenia and Malta concur with Czech Republic on lack of necessity for intra-EU BITs; Italy-Czech treaty has been terminated », Investment Arbitration Reporter, 6 August 2009.
- 15.
See de Mestral, Is a model EU BIT possible — or even desirable? Columbia FDI (2010) 21, available at: http://www.vcc.columbia.edu/, and especially the letter addressed by the Economic and Finance Committee to the Council of the EU of 2009 (‘[m]ost member states did not share the Commission’s concern regarding arbitration risks and discriminatory treatment of investors and a clear majority of member states preferred to maintain the existing agreements’). See also ‘EU Member States Reject the Call to Terminate Intra-EU Bilateral Investment Treaties,’ Investment Treaty News, 10 February 2009 and Antell / Carlson / Haworth McCandless , The European Commission and Investment Treaties, The European & Middle Eastern Arbitration Review 2010, online at: http://www.globalarbitrationreview.com.
- 16.
See, ECJ, Case C-205/06, Commission v Austria, [2009] ECR I, 1301, ECJ, Case C-249/06, Commission v Sweden, [2009] ECR I, 1335 and EJC, Case C-118/07 Commission v Finland, [2009] ECR I, 10889.
- 17.
The termination by Malta took effect on 23 February 2005, published in: Amtliche Sammlung des Bundesrechts der Schweiz (AS) 2005, 1163.
- 18.
“Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions towards a Comprehensive European International Investment Policy”, 7 July 2010, final As well as “Proposal for a Regulation of the European Parliament and of the Council Establishing Transitional Arrangements for Bilateral Investment Agreements between Member States and Third Countries”, 7 July 2010, COM(2010)344 final.
- 19.
See de Mestral, The Lisbon Treaty and the expansion of EU competence over foreign direct investment and the implications for investor-state arbitration, in: Sauvant (ed.), Yearbook on International Investment Law & Policy 2009–2010, 2010, Ch. 10.
- 20.
Of particular relevance will certainly be the inclusion of the public interest, namely democracy, human rights, rule of law, the environment in BITs; see, for example, Maes, Reclaiming the public interest in Europe’s international investment policy: Will the future EU BITs be any better than the 1’200 existing BITs of EU member states? Investment Treaty News, September 23, 2010, available at: http://www.iisd.org. The new role of the European Parliament in the area of the common commercial policy will enhance this debate, see Kerremans / Orbie, The Social Dimension of European Union Trade Policies, European Foreign Affairs Review 14 (2009) 5, p. 629.
- 21.
Agreement between the EFTA States and Singapore of 26 June 2002, Articles 37-49. See Ziegler, Dispute Settlement in Bilateral Trade Agreements: the EFTA Experience, in: Bartels / Ortino (eds.), Regional Trade Agreements and the WTO, 2007, p. 407.
- 22.
Essentially using the model developed by the EU with this country, see above. See in general on the EFTA Third Country Agreements: Ziegler, Wirtschaftsvölkerrecht der Schweiz – (eine Einführung unter Einschluss des Aussenwirtschaftsrechts), 2010.
- 23.
Free Trade Agreement between the EFTA States and the Republic of Korea of 15 December 2005, Article 1.4 Investment: « Regarding investment, reference is made to the agreement on investment separately concluded between Korea, on the one hand, and Iceland, Liechtenstein and Switzerland, on the other. This agreement shall for these Parties form part of the instruments establishing the free trade area ».
- 24.
See the Rules contained in the Agreements with Mexico as concluded by the EU and the EFTA-States (see above) and the parallel BITs of certain EFTA- and EU-States with Mexico.
- 25.
See the tensions that exist between Switzerland and the EU when it comes to the specific tax privileges for so-called holding companies; see “Antwort des schweizerischen Bundesrates vom 18.2.2009 auf die Interpellation Felix Müri (Steuerstreit. Haltung des Bundesrates)”, available at: http://www.parlament.ch/d/suche/seiten/geschaefte.aspx?gesch_id=20083954.
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Ziegler, A.R. (2013). The New Competence of the European Union in the Area of Foreign Direct Investment (FDI): A Third Country Perspective. In: Bungenberg, M., Herrmann, C. (eds) Common Commercial Policy after Lisbon. European Yearbook of International Economic Law(). Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-34255-4_14
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