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TTIP AND ISDS: NOT IRRECONCILABLE ACRONYMS
Nevertheless, the wide majority of civil society, that is, more than three thousand
individual citizens, business organizations, trade unions, consumer organizations,
law firms etc., expressed their opinions.44 Analyses of the high number of submissions
took more than a half year before a 140-page detailed report on consultation’s results
was published on 13 January 2015.45
On the basis of the collected replies, the European Commission divided their
statements into three categories. The first category rejects the TTIP in general. The
second group of replies particularly opposes investment protection and ISDS. The final
category contains specific observations on the posed questions. Mostly, according to
these replies the European Commission concluded that “views are divided with regard
to almost every question” and identified “four areas where further improvements should
be explored”: the protection of the right to regulate; the establishment and functioning
of arbitral tribunals; the relationship between domestic judicial systems and ISDS; and,
last but not least, the review of ISDS decision through an appellate mechanism.46 The
author acknowledges the rationale behind the four issues. The highlighted topics are
long-lasting notorious subjects of investment lawyers’ debates; yet, still without clear
and fitting answers (if they exist at all).
In the words of Commissioner Malmström, “the consultation clearly shows that
there is a huge scepticism against the ISDS instrument.”47 Therefore, the publication
was only a first step. The European Commission intended to continue, after publication
of the report, in consultations with the Member States, the European Parliament
and the interested stakeholders, such as NGOs, businesses associations or academia,
particularly on the above identified areas. This wider debate on investment protection
and ISDS in theTTIP should, in the view of the European Commission, aim to develop
proposals taking into account the presented scepticism and articulated concerns.
During her May visit in the European Parliament, Commissioner Malmström
set out the Commission’s preliminary ideas on further improvements. Malmström
wants to reinforce the right of governments to regulate in the public interest in an
operational provision. Further, the European Commission proposes a selection of
arbitrators from a pre-established roster and a widening of required qualifications
of the arbitrators. In order to ensure consistency of interpretation and review of
decisions, the proposal should include an appellate mechanism for ISDS modelled
largely on the WTO Appellate Body. Finally, the European Commission believes it
should address the question of the relationship between domestic legal systems and
ISDS to exclude a possibility that investors will have a second chance to overrule
the decision of a national court. In order to prevent parallel claims, the European
44 Supra note 43.
45 European Commission, Report presented today: Consultation on investment protection in EU-US
trade talks (13 January 2015), see
46 Supra note 43.
47 Ibid.