Skip to main content
SpringerLink
Log in

CETA: Gold Standard or Greenwashing?

  • Conference paper
  • First Online:
The Evolving Nature of EU External Relations Law

Abstract

The EU Treaties demand that EU trade policy must contribute to the sustainable development of the EU and its trading partners. It is investigated whether CETA is in conformity with this requirement and thus can form a gold standard for future trade agreements. The investor-state dispute settlement (ISDS) part of CETA, the Trade and Sustainable Development (TSD) chapters and the statements attached to the agreement are concentrated on. These aspects are investigated against the background of the manner in which EU trade agreements are negotiated, the role of the Trade Sustainability Impact Assessment (TSIA) system and public participation aspects. Under CETA’s Investment Court System (ICS, a form of ISDS), the national judiciary is bypassed, and states can be ordered to pay compensation for adopting non-discriminatory measures aimed at the protection of legitimate public welfare objectives, such as health, safety and the environment. This can cause a regulatory chill and hinder the ‘right to regulate’ in practice at a time where the adoption of climate changes measures already poses formidable challenges. Neither the TSD chapters nor the statements take away these concerns, notably because the chapters lack an enforcement mechanism with sanctions and because the statements lack clear explanations that could be of legal value. The manner in which the precautionary principle is dealt with in the TSD chapters and the statements is used as a case in point. CETA forms no gold standard, it is concluded, and should definitely not be mirrored in other EU FTAs like the EU-Mercosur agreement.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 169.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 219.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 219.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Notes

  1. 1.

    http://consilium.europa.eu/en/documents-publications/treaties-agreements/agreement/?id=2016017&DocLanguage=en. Accessed 1 April 2020.

  2. 2.

    Italy also indicated that it was unwilling to ratify CETA because Canada’s commitments under the agreement do not provide sufficient coverage of Italian products in terms of Designation of Origin or Geographical Indication protections. See Landini 2018 Italy won’t ratify EU free-trade deal with Canada: farm minister www.reuters.com/article/us-italy-minister-canada-trade/italy-wont-ratify-eu-free-trade-deal-with-canada-farm-minister-idUSKBN1JA0TR. Accessed 20 May 2020.

  3. 3.

    Court of Justice, Comprehensive Economic and Trade Agreement between Canada, of the one part, and the European Union and its Member States, of the other part (CETA), Opinion of the Court of 30 April 2019, Opinion 1/17, ECLI:EU:C:2019:341.

  4. 4.

    Schöllmann 2016.

  5. 5.

    https://europa.eu/rapid/press-release_IP-16-2371_en.htm. Accessed 5 April 2020.

  6. 6.

    Court of Justice, Free Trade Agreement between the European Union and the Republic of Singapore, Opinion of the Court, 16 May 2017, Opinion 2/15, ECLI:EU:C:2017:376, paras 285-293. The German Constitutional Court (Bundesverfassungsgericht, BVerfG) had also ruled that ICS concerned a shared power and forbade Germany from agreeing to the provisional application of this part of CETA (BVerfG cases 2 BvR 1368/16, 2 BvE 3/16, 2 BvR 1823/16, 2 BvR 1482/16 and 2 BvR 1444/16, 13 October 2016).

  7. 7.

    Hosuk Lee-Makiyama, director of trade think-tank ECIPE, argued that the EU could continue to apply all parts of the agreement aside from investment dispute settlement. See Sisto A and Jones G 2018 Italy says it won’t ratify EU-Canada trade deal; Canada plays down threat. www.reuters.com/article/us-italy-canada-trade/italy-says-it-wont-ratify-eu-canada-trade-deal-canada-plays-down-threat-idUSKBN1K318Q. Accessed 20 May 2020. A partner at Tereposky & Derose LLP (International Trade and Investment Lawyers) stated that the elements of the CETA that are being applied provisionally will remain in force regardless of the decisions taken by individual EU member states concerning ratification. Hohnstein 2018 Italy’s decision on CETA ratification—what does it really mean? https://www.lexology.com/library/detail.aspx?g=cd0a9158-ba06-4451-9922-1dd31bfda6c6. Accessed 15 December 2020.

  8. 8.

    See Van der Loo and Wessel 2017, pp. 735–770 on this question. Further, according to Suse and Wouters 2018, an argument can be made that where a Member State permanently and definitively fails to ratify a mixed agreement, the EU is under an obligation, as a matter of EU law, to terminate the provisional application of that agreement.

  9. 9.

    See for a more detailed account Douma 2017, pp. 193–212.

  10. 10.

    The first treaty was EU-CARIFORUM; see Council Decision of 15 July 2008 on the signature and provisional application of the Economic Partnership Agreement between the CARIFORUM States, of the one part, and the European Community and its Member States, of the other part, OJ L289, 30 October 2008; followed by the treaties with Korea (Council Decision of 16 September 2010 on the signing, on behalf of the European Union, and provisional application of the Free Trade Agreement between the European Union and its Member States, of the one part, and the Republic of Korea, of the other part, OJ L127, 14 May 2011), Colombia, Peru, Ecuador (Council Decision of 31 May 2012 on the signing, on behalf of the Union, and provisional application of the Trade Agreement between the European Union and its Member States, of the one part, and Colombia and Peru, of the other part, OJ L354, 21 December 2012 and Council Decision (EU) 2016/2369 of 11 November 2016 on the signing, on behalf of the Union, and provisional application of the Protocol of Accession to the Trade Agreement between the European Union and its Member States, of the one part, and Colombia and Peru, of the other part, to take account of the accession of Ecuador, OJ L356, 24 December 2016); Central America, which encompasses Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama Central America (encompassing Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama) Council Decision of 25 June 2012 on the signing, on behalf of the European Union, of the Agreement establishing an Association between the European Union and its Member States, on the one hand, and Central America on the other, and the provisional application of Part IV thereof concerning trade matters, OJ L346, 15 December 2012; and Moldova, Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and the Republic of Moldova, of the other part, opened for signature 27 June 2014, OJ L260/4 (entered into force 1 July 2016). The EU-Japan Economic Partnership Agreement came into force on 1 February 2019. Discussions on a separate Investment Protection Agreement (IPA) were fruitful regarding substantive aspects, yet procedural aspects regarding ICS were not accepted by Japan. For the time being, no further discussions are foreseen; see https://trade.ec.europa.eu/doclib/docs/2006/december/tradoc_118238.pdf. Accessed 29 February 2020. The EU-Singapore Agreement entered into force on 21 November 2019, while the IPA awaits ratification by all EU Member States before it can enter into force. The CJEU issued Opinion 2/15 (Singapore FTA), above n. 6, on this agreement, making it clear that it falls within the Union’s exclusive competence except for the provisions dealing notably with investment protection and ISD that fall within the competences shared with the Member States. The parts dedicated to the environment, labour and sustainable development formed a part of the Union’s exclusive competences.

  11. 11.

    FTA negotiations are currently taking place with Australia, Chile, India, Indonesia, Mexico (political agreement was reached, New Zealand and the USA (on the elimination of tariffs for industrial goods and on conformity assessment); political agreement was reached, see https://trade.ec.europa.eu/doclib/press/index.cfm?id=1830. Accessed 7 July 2020.

  12. 12.

    Preamble, 9th point CETA.

  13. 13.

    Malmström and Freeland 2016.

  14. 14.

    Venezuela’s membership has been suspended since 1 December 2016 due to the political situation in the country.

  15. 15.

    According to Brazil’s National Institute for Space Research (INPE), since president Bolsonaro was elected in October 2018, deforestation increased by 30%, partially by dismantling the institutions responsible for the protection of the environment. See Londoño and Casado 2019 Amazon deforestation in Brazil rose sharply on Bolsonaro’s watch. http://nytimes.com/2019/11/18/world/americas/brazil-amazon-deforestation.html. Accessed 20 May 2020.

  16. 16.

    It stipulates that the Parties to the WTO Agreement recognise that their relations in the field of trade and economic endeavour should be conducted “with a view to raising standards of living, ensuring full employment and a large and steadily growing volume of real income and effective demand, and expanding the production of and trade in goods and services, while allowing for the optimal use of the world’s resources in accordance with the objective of sustainable development, seeking both to protect and preserve the environment and to enhance the means for doing so in a manner consistent with their respective needs and concerns at different levels of economic development”.

  17. 17.

    The provision did play a role in the US—Shrimp dispute. See WTO Appellate Body, United States—Import Prohibition of Certain Shrimp and Shrimp Products, Report, 12 October 1998, DSR 1998:VII, 2755, WT/DS58/AB/R, paras 129 and 153. See also Schurmans 2015, pp. 28–34.

  18. 18.

    For example, the Dominican Republic-Central America-United States Free Trade Agreement, opened for signature 05 August 2004, 19 USC 4001(entered into force 01 March 2006) (CAFTA-DR).

  19. 19.

    Investment Treaty News 2020 Trump signs USMCA, bringing NAFTA’s replacement closer to entry into force https://cf.iisd.net/itn/2020/03/10/trump-signs-usmca-bringing-naftas-replacement-closer-to-entry-into-force/. Accessed 20 May 2020.

  20. 20.

    Office of the United States Trade Representative 2020 Ambassador Lighthizer statement on Canada’s approval of the USMCA https://ustr.gov/about-us/policy-offices/press-office/press-releases/2020/march/ambassador-lighthizer-statement-canadas-approval-usmca. Accessed 20 May 2020.

  21. 21.

    EC Trade 2018.

  22. 22.

    In contravention of (in particular) Comprehensive Economic and Trade Agreement between Canada, of the one part, and the European Union and its Member States, of the other part, opened for signature 30 October 2016, OJ L 11/23 (entered into force (provisionally) 21 September 2017) (CETA), article 8(9).

  23. 23.

    EU Trade Commissioner Cecilia Malmström, Speech at the Center for Strategic and International Studies Stateman’s Forum, Washington, 4 May 2015. See Palmer 2015 ‘Malmström to unveil investment dispute plan for TTIP’ http://politico.eu/article/eu-malmstrom-unveils-ttip-investment-dispute-settlement-plan/. Accessed 20 May 2020.

  24. 24.

    For instance, Koeth 2016; Corporate Europe Observatory 2016.

  25. 25.

    In all these cases, Canada accused the EU and its Member States of introducing trade barriers that were incompatible with WTO law.

  26. 26.

    Canada produces a lot of oil from tar sands, which causes 23% more greenhouse gas emissions than regular oil and poses a risk to local biodiversity. The European Parliament reiterated its concern to this issue, noting under point 13 that CETA should not affect the EU’s right to legislate in the fuel quality directive, see European Parliament resolution of 8 June 2011 on EU-Canada trade relations (P7TA(2011)0267). These concerns disappeared in the end, as shows from the 2014 support in parliament to stop labelling oil from tar sands as dirty. See also Guibert 2017 EU opens door to Canada’s dirty oil, www.euractiv.com/section/ceta/news/eu-opens-door-to-canadas-dirty-oil/. Accessed 20 May 2020. Berke 2017 ‘No country would find 173 billion barrels of oil in the ground and just leave them’: Justin Trudeau gets a standing ovation at an energy conference in Texas https://markets.businessinsider.com/commodities/news/trudeau-gets-a-standing-ovation-at-energy-industry-conference-oil-gas-2017-3-1001825435. Accessed 20 May 2020; EurActiv and Reuters 2014 Activist MEPs put tar sands ‘dirty label’ back on the agenda www.euractiv.com/section/energy/news/activist-meps-put-tar-sands-dirty-label-back-on-the-agenda/. Accessed 20 May 2020. And Trew 2014 Another big winner from CETA: the tar sands https://canadians.org/analysis/another-big-winner-ceta-tar-sands. Accessed 20 May 2020.

  27. 27.

    Kikou 2016, p. 54.

  28. 28.

    Marx et al. 2017a, pp. 78–88 wonder whether the inclusion of social sustainability requirements is primarily intended to favour interest groups, rather than to actually have any significant impact.

  29. 29.

    The Transatlantic Trade and Investment Partnership (TTIP) negotiations were launched in 2013 and ended without conclusion at the end of 2016. Instead, the conclusion of a limited agreement that would notably encompass mutual acceptance of conformity assessment is being discussed.

  30. 30.

    For a more detailed account of that topic, see Douma 2021.

  31. 31.

    https://investmentpolicy.unctad.org/investment-dispute-settlement. Accessed 20 March 2020.

  32. 32.

    PCA, Bilcon of Delaware et al. v. Government of Canada, Award on Damages, 10 January 2019, Case No. 2009-04.

  33. 33.

    See Ahuja 2019; Baltzan B 2020 NAFTA’s Replacement Gives Labor Some Shelter From Globalization’s Storms. https://foreignpolicy.com/2020/01/16/usmca-mexico-canada-trump-workers-democrats-naftas-replacement-gives-labor-some-shelter-from-globalizations-storms/. Accessed 20 May 2020. Also see Sect. 4.2.2.

  34. 34.

    Compare the German company Uniper that is contemplating bringing a claim of reportedly € 850 million against the Dutch law phasing out the generation of coal-fired power plants after 2030. See Niemelä et al. 2020. At the start of April 2020, it became clear that owners of coal-fired power plants in the Netherlands are negotiating compensation for the phase out (NOS 2020 Kabinet neemt toch nu klimaatmaatregelen; productie kolencentrales omlaag [Government adopts climate measures after all; decrease in production of coal fires power plants] nos.nl/artikel/2329160-kabinet-neemt-toch-nu-klimaatmaatregelen-productie-kolencentrales-omlaag.html Accessed 20 May 2020).

  35. 35.

    ICSID, Vattenfall v Germany II, Case No. ARB/12/12.

  36. 36.

    ICSID, Gabriel Resources Ltd. and Gabriel Resources (Jersey) v. Romania, Case No. ARB/15/31.

  37. 37.

    Phillip Morris’s claim was brought under the 1993 Hong Kong-Australia investment agreement. The claim was launched in 2012 at the Permanent Court of Arbitration (PCA), after an unsuccessful attempt to have the measure overturned by the Australian high court. On 17 December 2015, the PCA dismissed the claim as it constituted an abuse of rights. See PCA, Philipp Morris Asia Limited v Commonwealth of Australia, Award on Jurisdiction and Admissibility, 17 December 2015, Case No. 2012-12. Shortly before the claim was issued, the US company had moved ownership of its Australian operations to Hong Kong for the principal, or even sole, purpose of taking advantage of the ISDS provisions in the agreement. The final award regarding costs ordered Philip Morris to pay half of Australia’s legal costs, while not disclosing the amount. The full amount turned out to be almost $A24 million (around US$ 16 million). Hence Australia might feel like it won when in reality it lost some $12 million (or US$ 8 million) in legal fees plus €333,059.91 in arbitrator’s fees. See PCA, Philipp Morris Asia Limited v Commonwealth of Australia, Final Award Regarding Costs, 8 March 2017, Case No. 2012-12. See also Hepburn J 2019 Final costs details are released in Philip Morris v. Australia following request by IAReporter. www.iareporter.com/articles/final-costs-details-are-released-in-philip-morris-v-australia-following-request-by-iareporter/. Accessed 20 May 2020. Together with a WTO case on the same issue and the high court case, Australia’s legal costs were about $39 million (Hutchens and Knaus 2018) Revealed: $39 m cost of defending Australia’s tobacco plain packaging laws. www.theguardian.com/business/2018/jul/02/revealed-39m-cost-of-defending-australias-tobacco-plain-packaging-laws. Accessed 20 May 2020.

  38. 38.

    European Commission 2015; In March 2020, this document was not available in the Eurlex databases, but could be accessed at https://ec.europa.eu/transparency/regdoc/rep/10102/2015/EN/10102-2015-3-EN-F1-1.Pdf. Note that since the public consultation was held between 27 March and 13 July 2014, it took over half a year to prepare the report.

  39. 39.

    Ibid., p. 3.

  40. 40.

    The same argument had already been used in response to critical questions from the European Parliament, as set out below in Sect. 4.2.2.

  41. 41.

    The original negotiating mandate from 2009 was amended in 2011. The latter adjustment prompted the Commission to provide a state-of-the-art investor-state dispute settlement mechanism in the agreement. According to Council Press Release 920/15, these decisions were not made public until 15 December 2015. https://www.consilium.europa.eu/en/press/press-releases/2015/12/15/eu-canada-trade-negotiating-mandate-made-public/. Accessed 7 July 2020.

  42. 42.

    Legal scrubbing is the final process in which legal specialists comb through an agreement word by word, basically to make sure there are no typos or out-and-out errors.

  43. 43.

    See Edward et al. 2017.

  44. 44.

    CETA, above n. 22, annex 8-a, article 3.

  45. 45.

    See European Commission Press release IP/16/399 (2016b) CETA:EU and Canada agree on new approach on investment in trade agreement. https://europa.eu/rapid/press-release_IP-16-399_en.htm. Accessed 7 July 2020.

  46. 46.

    De la Baume 2018 Walloon parliament rejects CETA deal www.politico.eu/article/walloon-parliament-rejects-ceta-deal/. Accessed 20 May 2020.

  47. 47.

    Council Decision (EU) 2017/37 of 28 October 2016 on the signing on behalf of the European Union of the Broad Economic and Trade Agreement (CETA) between Canada, of the one part, and the European Union and its Member States, of the other part, OJ L11, 14 January 2017, p. 1; see also https://www.consilium.europa.eu/en/meetings/international-summit/2016/10/30/. Accessed 7 July 2020.

  48. 48.

    See Sect. 4.2.4.

  49. 49.

    For example, European Parliament’s Res P8_TA-PROV called for the enforceability of application and compliance with environmental and labour law provisions through regular dispute resolution mechanisms, including the positive experience with this in the US trade agreements. See European Parliament resolution of 8 July 2015 containing the European Parliament’s recommendations to the European Commission on the negotiations for the Transatlantic Trade and Investment Partnership (TTIP) [2014/2228(INI)]; This aspect is returned to in Sect. 4.3.3. An overview of the many aspects of CETA that did not live up to Parliament’s demands can be found in de Ville 2016.

  50. 50.

    The EP vetoed the Anti-Counterfeiting Trade Agreement (ACTA) in 2012, for instance.

  51. 51.

    Consolidated Version of the Treaty on the Functioning of the European Union, 2012, OJ C 326 (TFEU), article 11: “The environmental protection requirements should be integrated into the definition and implementation of the Union’s policies and actions, in particular with a view to promoting sustainable development”.

  52. 52.

    The fierce protests of ‘anti-globalists’ around the WTO summit became known as the ‘battle of Seattle’ and led to planned decisions being pushed to a new summit in Doha (Qatar), a place with significantly fewer opportunities for protests.

  53. 53.

    For an up-to-date overview, see https://ec.europa.eu/trade/policy/policy-making/analysis/policy-evaluation/sustainability-impact-assessments/index_en.htm#study-3. Accessed 7 July 2020.

  54. 54.

    European Commission 2017a.

  55. 55.

    Inter alia meetings with civil society (in Brussels and Ottawa with a wide range of interest groups and trade unions), a stakeholder workshop (in Ottawa with trade associations, labour organisations, trade unions and environmental organisations) and a website with a discussion forum.

  56. 56.

    Development Solutions 2011.

  57. 57.

    Answer given by Mr. De Gucht on behalf of the Commission on 5 February 2013. https://www.europarl.europa.eu/sides/getAllAnswers.do?reference=E-2012-011275&language=EN. Accessed 7 July 2020; see also https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:C:2013:321E:TOC. Accessed 7 July 2020. Also compare the comments above in Sect. 4.2.1 on the ISDS consultation.

  58. 58.

    Answer by Mr. De Gucht on behalf of the Commission on 29 January 2013. https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:C:2013:321E:TOC. Accessed 7 July 2020.

  59. 59.

    EC Trade 2017a.

  60. 60.

    European Commission 2016a. This was the first version of the handbook.

  61. 61.

    Bilcon of Delaware et al. v. Government of Canada, above n. 32.

  62. 62.

    Aldin 2019; Doelle 2019; Quinn 2018; Canadian opposition to Nafta’s Chapter 11 gives Trudeau leeway, http://bloomberg.com/news/articles/2018-04-17/canadian-opposition-to-nafta-s-chapter-11-gives-trudeau-leeway. Accessed 20 May 2020.

  63. 63.

    Prime Minister Trudeau and Minister Freeland speaking notes for the United States-Mexico-Canada Agreement press conference (2018). https://pm.gc.ca/en/news/speeches/2018/10/01/prime-minister-trudeau-and-minister-freeland-speaking-notes-united-states. Accessed 7 July 2020.

  64. 64.

    At the time of completion of this contribution (April 2020), work on the TSIA on the EU-Mercosur Treaty still has not finished (in February 2020 an interim report was published), while negotiations are already nearing completion. While negotiations with Mexico were completed in April 2018, only an inception report had been presented at that moment in time (LSE Enterprise 2017). At the presentation of the report complaints were raised regarding these violations of the TSIA handbook; see European Commission 2017b.

  65. 65.

    For a more detailed discussion of the EU’s TSIA system, see Douma 2017, pp. 193–212.

  66. 66.

    See n. 6 above.

  67. 67.

    BVerfG Cases 2 BvR 1368/16, 2 BvE 3/16, 2 BvR 1823/16, 2 BvR 1482/16 and 2 BvR 1444/16, above n. 6 As explained above, ICS is a form of ISDS.

  68. 68.

    Statement no. 20 from the Council. See https://data.consilium.europa.eu/doc/document/ST-13463-2016-REV-1/en/pdf. Accessed 7 July 2020.

  69. 69.

    www.consilium.europa.eu/en/documents-publications/treaties-agreements/agreement/?id=2016017. Accessed 20 May 2020.

  70. 70.

    Letter of Dutch Minister Kaag of Foreign Trade and Development Cooperation to the House of Representatives of 26 April 2018, www.rijksoverheid.nl/binaries/rijksoverheid/documenten/kamerstukken/2018/04/26/kamerbrief-over-investeringsakkoorden-met-andere-eu-lidstaten/kamerbrief-over-investeringsakkoorden-met-andere-eu-lidstaten.pdf. Accessed 7 July 2020.

  71. 71.

    On 6 April 2016, a majority of 61% of the participants in a referendum voted against the law on the approval of the EU-Ukraine Association agreement. Merely 32% of the voters turned up to cast their votes. As the referendum was not binding, the Dutch government was able to vote in favour of the agreement after adding a declaration in which it was underlined inter alia that the agreement would not automatically lead to Ukraine’s EU membership. See Lambie and Koole 2016 Reconstructie Oekraïne-referendum: Hoe de nee-stem een ja wordt [Reconstruction Ukraine-referendum; How a no-vote becomes a yes] https://www.rtlnieuws.nl/nederland/politiek/artikel/346556/reconstructie-oekraine-referendum-hoe-de-nee-stem-een-ja-wordt. Accessed 7 July 2020; Aalberts 2016 Wat deed Rutte met de uitslag van het Oekraïne-referendum [What did Rutte do with the result of the Ukraine-referendum] https://www.ftm.nl/artikelen/wat-deed-rutte-met-uitslag-oekraine-referendum. Accessed 7 July 2020.

  72. 72.

    Council of the European Union 2016, Statement No. 37.

  73. 73.

    Council of the European Union 2016, Statement No. 23.

  74. 74.

    Rios 2018 Italy threatens to block CETA ratification www.euractiv.com/section/ceta/news/italy-threatens-to-block-ceta-ratification/. Accessed 20 May 2020.

  75. 75.

    More specifically Chapter 8 (“Investments”) and Section F (“Investor-State Investment Dispute Resolution”). See CETA, above n. 22.

  76. 76.

    Opinion 1/17: Request for an opinion submitted by the Kingdom of Belgium pursuant to Article 218(11) TFEU, OJ C 369, 30 October 2017. In concrete terms, Belgium asked the Court on ICS’ compatibility with the exclusive jurisdiction of the EU Court to give a definitive interpretation of EU law; the general principle of equality and the requirement for the useful functioning of EU law; the right to access the courts and the right to an independent and impartial justice system. On the latter point, Belgium seeks advice on the conditions relating to remuneration, appointments and release of the judges, the Guidelines of the International Bar Association on conflicts of interest in international arbitration and the introduction of a code of conduct, and external professional activities relating to the judges’ investment disputes. See further https://diplomatie.belgium.be/sites/default/files/downloads/ceta_summary.pdf. Accessed 20 May 2020.

  77. 77.

    Court of Justice, Slowakische Republik (Slovak Republic) v Achmea, Judgment, 6 March 2018, Case C-284/16, ECLI:EU:C:2018:158 (Achmea). The Luxembourg judges did not follow the conclusion of Advocate General Wathelet of 19 September 2017 (ECLI:EU:C:2017:699) in this case. As a result of this ruling, Achmea is unlikely to be entitled to compensation of more than €22 million from Slovakia awarded by ISDS arbitrators.

  78. 78.

    Schepel 2018. See also Ankersmit and Hughes 2018.

  79. 79.

    Eckes 2018 Teken het handelsverdrag tussen EU en Canada nu nog niet [Don’t sign the EU-Canada trade treaty yet] http://volkskrant.nl/columns-opinie/teken-het-handelsverdrag-tussen-eu-en-canada-nu-nog-niet~bc5b971a/. Accessed 7 July 2020; Krajewski 2018.

  80. 80.

    See for instance Ankersmit 2016, pp. 46–63; Kokott and Sobotta 2016, p. 1; Krajewski and Hoffmann 2016; Govaere 2016. Legal Service of the European Parliament 2016, arriving at a different conclusion on the compatibility with the Treaties of investment dispute settlement provisions in EU trade agreements.

  81. 81.

    Joint Interpretative Instrument on the Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union and its Member States, OJ L11/3, 14 January 2017.

  82. 82.

    Vienna Convention on the Law of Treaties, opened for signature 23 May 1969, 1155 UNTS 331 (entered into force 27 January 1980) (VCLT), article 31, which provides among other things, that a treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose, and that this context shall comprise, in addition to the text: … any instrument which was made by one or more parties in connexion with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty.

  83. 83.

    Joint Interpretative Instrument on CETA, above n. 81, point 1(d).

  84. 84.

    Ibid., point 7.

  85. 85.

    Ibid.

  86. 86.

    Ibid., point 10.

  87. 87.

    CETA, above n. 22, article 24.25.

  88. 88.

    Ibid. Note that the French, Portuguese, Spanish and Swedish versions more accurately talk about effective applicability rather than about enforceability, given the absence of sanction that could force a party violating the sustainability provisions to change its behaviour.

  89. 89.

    Joint Interpretative Instrument on CETA, above n. 81, preamble, sub. (e).

  90. 90.

    Council of the European Union 2016, Statement No. 38.

  91. 91.

    Tweede Kamer, Brief van de Minister voor Buitenlandse Handel en Ontwikkelingssamenwerking [Letter from the Minister of Foreign Trade and Development Cooperation] 31985 No. 54, 25 September 2017, 44.

  92. 92.

    ILC 2011, para 1.2.

  93. 93.

    UN 2012, para 3.6.1.

  94. 94.

    ILC 2011, para 1.6.3.

  95. 95.

    Joint Interpretative Instrument on CETA, above n. 81, preamble, sub (d).

  96. 96.

    See, for example, Free trade Agreement between the European Union and its Member States, of the one part, and the Republic of Korea, of the other part, opened for signature 6 October 2010, OJ L127 (entered into force 13 December 2015), articles 45 and 46, regarding the common interpretative declaration.

  97. 97.

    Compare Shyrbman 2016; Griller et al. 2017; and Lester 2016.

  98. 98.

    Joint Interpretative Instrument on CETA, above n. 81, preamble, sub. (d).

  99. 99.

    See for further details Douma 2019.

  100. 100.

    ILC 2006.

  101. 101.

    Ibid.

  102. 102.

    Compare UK Attorney’s General Office 2019, who on the one hand submits that “[a] unilateral declaration by one party to a bilateral agreement constitutes an authentic interpretation of the treaty if it is accepted by the other party” while adding that he understands that the EU has agreed it will not object to the Unilateral Declaration, and that this confirms that the UK can rely on the declaration.

  103. 103.

    Directive 96/22/EC concerning the prohibition on the use in stockfarming of certain substances having a hormonal or thyrostatic action and of ß-agonists, OJ L125, 23 May 1996, pp. 3–9, as amended by Directive 2003/74/EC, OJ L262, 14 October 2003, pp. 17–21, and Directive 2008/97, OJ L318, 28 November 2008, pp. 9–11.

  104. 104.

    Council of the European Union 2016, Declaration No. 26.

  105. 105.

    Ibid., Declaration 30.

  106. 106.

    Ibid., Declaration 7.

  107. 107.

    Ibid., Statement 36.

  108. 108.

    As explained in the introduction this forms a constitutional obligation enshrined notably in TFEU, above n. 51, articles 3(5) and 11. See also Consolidated Version of the Treaty on the European Union, 2012, OJ C326 (TEU), article 21.

  109. 109.

    The definition that was introduced by the World Commission on Environment and Development 1987.

  110. 110.

    CETA, above n. 22, article 22(1) lid 1.

  111. 111.

    Ibid., article 22.1(3)(a).

  112. 112.

    Ibid., article 22.1(3)(b).

  113. 113.

    Ibid., article 22.3(2)(b).

  114. 114.

    Ibid., article 24.4 lid 2.

  115. 115.

    Ibid., articles 23.2 and 24.3.

  116. 116.

    Ibid., articles 23.4(1) and 24.5(1).

  117. 117.

    Ibid., articles 23.4(3) and 24.5(3).

  118. 118.

    Ibid., articles 23.5(1)(a) and 24.6(1)(a).

  119. 119.

    Ibid., articles 23.5(1)(b) and 24.6(1)(b).

  120. 120.

    Ibid., articles 23.5(2) and 24.6(2).

  121. 121.

    Ibid., articles 23.6 and 24.7.

  122. 122.

    Ibid., article 24.9. Environmental goods and services are designed to protect the environment, such as windmills and processes to save energy. Within the WTO, for years there have been attempts to agree on reducing tariffs and non-tariff barriers to these goods and services.

  123. 123.

    Ibid., arts, 24.10 and 24.11, respectively.

  124. 124.

    Ibid., article 24.12.

  125. 125.

    The USMCA sets out that a panel “shall presume that a failure is in a manner affecting trade or investment between the Parties, unless the responding Party demonstrates otherwise”.

  126. 126.

    CETA, above n. 22, article 24.8.

  127. 127.

    Ibid., article 23.3(3).

  128. 128.

    Stoll et al. 2016, For further arguments, see Foodwatch and the Council of Canadians 2020.

  129. 129.

    See Douma 2016 for a comprehensive discussion of the arguments that EU Trade Commissioner Malmström and Dutch Minister Ploumen put forward.

  130. 130.

    Stoll 2019; Douma 2003.

  131. 131.

    The European precautionary ban on beef hormones was approved by the Court in Case C-331/88, while the WTO dispute resolution body found the same ban contrary to WTO law in EC—Hormones (United States). See, respectively, Court of Justice, The Queen v Minister of Agriculture, Fisheries and Food and Secretary of State for Health, ex parte: Fedesa and others, Judgment, 13 November 1990, Case C-331/88, ECLI:EU:C:1990:391; WTO Appellate Body, European Communities—Hormones (United States), Report, 13 February 1998. WT/DS26/AB/R, WT/DS48/AB/R.

  132. 132.

    WTO Panel Body, European Communities—Biotech (Canada), Report, 29 September 2009, WT/DS291/R; WT/DS292/R; WT/DS293/R. See also Arcuri 2017, pp. 35–58 finding that CETA offers ample margin to apply the agreement in a way respectful of stringent regulatory standards and of the precautionary principle, while warning that it remains to be seen whether this path will be followed in practice.

  133. 133.

    Douma 2019, pp. 163–200.

  134. 134.

    This happened in the following disputes: WTO Appellate Body, Japan—Agricultural products II, Report, 22 February 1999, WT/DS76/AB/R; WTO Appellate Body, Japan—Measures Affecting the Importation of Apples, Report, 23 June 2005, WT/DS245/AB/R; WTO Appellate Body, Korea—Import Bans, and Testing and Certification Requirements for Radionuclides, Report, 26 April 2019, WT/DS495/AB/R.

  135. 135.

    E.g. Japan—Agricultural products II, Ibid.

  136. 136.

    Dutch Minister Ploumen’s assertion (letter dated 17 August 2016, copy in the possession of author) that article 24.8 of CETA allows for precautionary measures fails to address the wider scope of the principle in the EU. She also argued that the CJEU’s rulings on precautionary measures will keep their validity under CETA. However, the fact that the CJEU allows for EU precautionary measures does not mean that international dispute settling bodies will do the same. In fact, such situations have already arisen where it concerns the EU’s beef hormones ban.

  137. 137.

    Japan—Measures Affecting the Importation of Apples, above n. 134. Japan had argued that there was no certainty as to how diseases spread (they did) and therefore claimed to be entitled to take the certain uncertainty (but this was not allowed).

  138. 138.

    European Commission 2000, pp. 14–15.

  139. 139.

    EU Commissioner Malmström, letter of 16 November 2016, copy in the possession of author. She referred to articles 168(1), 169(1) and (2) and 191 TFEU that deal with the protection of public health, consumers and the environment respectively. It can be noted that EU directives and regulations are not mentioned in unilateral declaration nr 7 (see Sect. 4.2.4.2 above).

  140. 140.

    Commission Indépendante 2017.

  141. 141.

    The Russian and Spanish versions encompass “принятия экономически эффективных мер по предупреждению ухудшения состояния окружающей среды”[taking cost-effective measures to prevent environmental degradation] and “la adopción de medidas eficaces en función de los costos para impedir la degradación del medio ambiente“ [the adoption of cost-effective measures to prevent environmental degradation] respectively.

  142. 142.

    Article 5 Environment Charter (Charte de l’Environnement de 2004, NOR:JUSX0300069L, 02 March 2005) states: “When the occurrence of any damage, albeit unpredictable in the current state of scientific knowledge, may seriously and irreversibly harm the environment, public authorities shall, with due respect for the principle of precaution and the areas within their jurisdiction, ensure the implementation of procedures for risk assessment and the adoption of temporary measures commensurate with the risk involved in order to preclude the occurrence of such damage”.

  143. 143.

    Conseil Constitutionnel [Constitutional Council of France], Comprehensive Economic and Trade Agreement between Canada, on the one hand, and the European Union and its Member States, on the other, Decision No. 2017-749 DC of 31 July 2017.

  144. 144.

    Established under CETA, above n. 22, article 26.1.

  145. 145.

    Ibid, article 9(a), which states: “CETA commits the European Union and its Member States and Canada to establish and promote high levels of environmental protection, and to seek to continually improve their legislation and policies in this area as well as the underlying levels of protection”.

  146. 146.

    Ibid., article 4.2(1), incorporating and making part of the agreement article 2 TBT.

  147. 147.

    See Douma 2020.

  148. 148.

    Opinion 2/15 (Singapore FTA), above n. 6, para 161.

  149. 149.

    CETA, above n. 22, articles 23.11(1) and 24.16(1).

  150. 150.

    Ibid, articles 23.9 and 24. 14.

  151. 151.

    Ibid, articles 23.10 and 24.15.

  152. 152.

    See for example Gruni 2017; De Ville 2016.

  153. 153.

    The term used in point 10(a) of the Joint Interpretative Instrument on CETA, above n. 81; see Sect. 4.2.4.1 above.

  154. 154.

    Alexovicová and Prévost 2018.

  155. 155.

    European Parliament resolution of 25 November 2010 on human rights and social and environmental standards in international trade agreements (2009/2219(INI)), point 22(c); European Parliament resolution of 5 July 2016 on implementation of the 2010 recommendations of Parliament on social and environmental standards, human rights and corporate responsibility (2015/2038(INI)), points 21 (c) and (d).

  156. 156.

    Joint Interpretative Instrument on CETA, above n. 81, point 10(a).

  157. 157.

    Tweede Kamer, Brief van de Staatssecretaris van Economische Zaken [Letter from the State Secretary for Economic Affairs],11 October 2016, 31985 No. 44.

  158. 158.

    Marx 2017b.

  159. 159.

    Dominican Republic—Central America—United States Free Trade Agreement, Arbitral Panel Established pursuant to Chapter XX, Guatemala—Issues Relating to the Obligations Under Article 16.2.1(a) of the CAFTA-DR, Final Report, 14 June 2017.

  160. 160.

    CAFTA-DR, above n. 18, article 16.2.1(a).

  161. 161.

    Guatemala—Issues Relating to the Obligations Under Article 16.2.1(a) of the CAFTA-DR, above n. 159, points 465 and 496.

  162. 162.

    Ibid., point 491.

  163. 163.

    Ibid, point 496.

  164. 164.

    Ibid, point 505.

  165. 165.

    EC Trade 2017b.

  166. 166.

    Ibid, p. 3.

  167. 167.

    EC Trade 2018.

  168. 168.

    EC Trade 2017a, point 6.4 at p. 28.

  169. 169.

    EC Trade 2018, p. 2.

  170. 170.

    As Gruni 2017 demonstrates regarding the rights of workers in Korea under the EU-Korea Free Trade Agreement, above n. 96, which came into force (provisionally) on 1 July 2011.

  171. 171.

    Barbu et al. 2017; Marx 2016; Ebert 2016.

  172. 172.

    This is also argued in The Netherlands at International Organisations 2020. Also see Brunsden and Mallet 2020 France and Netherlands call for tougher EU trade conditions. Bloc urged to enforce environmental and labour standards through tariffs www.ft.com/content/e14f082c-42e1-4bd8-ad68-54714b995dff. Accessed 20 May 2020.

  173. 173.

    According to the Canadian ambassador to the Netherlands during the expert meeting in the Dutch Senate on 19 May 2020, Canadians invested 25 billion Euro in The Netherlands in 2018. http://youtube.com/watch?v=TvCqFhO98. Accessed 20 May 2020.

  174. 174.

    See http://tweedekamer.nl/kamerstukken/plenaire_verslagen/detail/b85c005d-1215-4151-89f9-4ec67b88a658. Accessed 8 July 2020; and UNCTAD 2019.

  175. 175.

    Croatia, the Czech Republic, Latvia, Malta, Poland, Romania and the Slovak Republic. See CETA, above n. 22, Annex 30-A.

  176. 176.

    In theory investors could bring their claims to national courts, but this forms “merely a possibility in the discretion of the claimant investor” as the latter can decide “to submit the dispute to arbitration, without that Member State being able to oppose this”. Opinion 2/15 (Singapore FTA), above n. 6, paras 290–292.

References

Download references

Author information

Authors and Affiliations

  1. EU Legal—Centre for European and International Law, Van Loostraat 32, 2582 XD, The Hague, The Netherlands

    W. Th. Douma

  2. European Environmental Law Consultancy, The Hague, The Netherlands

    W. Th. Douma

  3. Ghent University, Ghent, Belgium

    W. Th. Douma

  4. Dutch Ministry of Social Affairs and Employment, The Hague, The Netherlands

    W. Th. Douma

Authors
  1. W. Th. Douma
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to W. Th. Douma .

Editor information

Editors and Affiliations

  1. EU Legal—Centre for European and International Law, The Hague, The Netherlands

    W. Th. Douma

  2. Amsterdam Centre for European Law and Governance, University of Amsterdam, Amsterdam, The Netherlands

    C. Eckes

  3. Ghent European Law Institute (GELI), Ghent University, Ghent, Belgium

    P. Van Elsuwege

  4. T.M.C. Asser Institute, The Hague, The Netherlands

    E. Kassoti

  5. Faculty of Law, Maastricht University, Maastricht, The Netherlands

    A. Ott

  6. Faculty of Law, Groningen University, Groningen, The Netherlands

    R. A. Wessel

Rights and permissions

Reprints and permissions

Copyright information

© 2021 T.M.C. Asser Press and the authors

About this paper

Check for updates. Verify currency and authenticity via CrossMark

Cite this paper

Douma, W.T. (2021). CETA: Gold Standard or Greenwashing?. In: Douma, W.T., Eckes, C., Van Elsuwege, P., Kassoti, E., Ott, A., Wessel, R.A. (eds) The Evolving Nature of EU External Relations Law. T.M.C. Asser Press, The Hague. https://doi.org/10.1007/978-94-6265-423-5_4

Download citation

  • DOI: https://doi.org/10.1007/978-94-6265-423-5_4

  • Published:

  • Publisher Name: T.M.C. Asser Press, The Hague

  • Print ISBN: 978-94-6265-422-8

  • Online ISBN: 978-94-6265-423-5

  • eBook Packages: Law and CriminologyLaw and Criminology (R0)

Publish with us

Policies and ethics

Search

Navigation